Thursday, September 3, 2009

Monopolists - The Other Pest.

Sorry about the delay in the post. I was having internet troubles and passed out about 6 hours earlier then normal.

So I've received a handful of suggestions to go back to the white text on black instead of the green and as you all are the ones reading it I'd be more then happy to change it hehe. (haters)

Briefly, the new arena season has been awesome so far. Sales are way up for your average weekday and it's making me glad that I spent the past week turning all my profit into backstock. I have enough mats to last quite a while so I'm really enjoying the increase in sales.

I don't feel we've seen the "worst" to be honest. A new arena season + a holiday weekend coming up should mean it's most likely going to get pretty hectic this weekend.

I'm going to go ahead and write the other part of last nights blog about what to do if you have more monopolist competition rather then a bunch of smaller competitors.

This is all based off my personal experience where on my server I have both a handful of smaller competitors and 2-3 monopolists in both glyphs and gems. Yesterday I told you about how I dealt with smaller competition by inflating mat prices to try to drive them away. The reason this isn't as successful with larger competition is because if they were smart they would have enough backstock to last awhile and ride out the high prices.

Now my approach to larger competition is generally the goblin method. When I first got into the gem market on my server there were 2 large competitors in which 1 of them had pretty much had a domination on the market since wrath launched. I know he has a large backstock of ore and gems because I used to supply ore to him when I was addicted to mining.

The rare gem market on my server is decent. Average scarlet ruby sells for 40-70g and the others sell for 20-40g. The only exception would be the forest emeralds which generally sell for 10-15 often lower.

Now before I got into the cut gem market I was simply selling uncuts. But soon enough I had way more backstock then I could ever push out as uncuts and decided to give the cut market a go simply so I could burn through my backstock quicker to afford more ore. (at that time I was only sitting on 3-5k) .

Since I had been used to selling uncut gems for under 10g each and making money off it selling the cut gems for 10-15g was profit for me still and the gems sold relatively quicker then the uncuts. They sold quicker because my competition made the mistake of buying out my gems and relisting them thus funding my growth to what it is today.

That screenshot is of one of the monopolist thats had control of the market since the start of wrath.

My main goal was to pretty much take the market from him and from the looks of it that's pretty much what I've been doing.

As of lately I've stopped my goblin tactics and became more greedy and started selling gems at normal competitive prices. However, my competition doesn't undercut me nearly as much anymore and they don't harass me about my ways of selling gems.

If you take this approach and then later raise the prices be careful of revenge seeking competition such as the ones on my server who pulled the same tactics I used on them against me when I tried resetting certain gem markets. I'd buy all the low gems and relist them at 40g and I noticed my competition would keep listing at the 15-20g range. This really pissed me off as I thought I was doing them a favor and in turn they pretty much gave me the finger.

So what did I do? I went back to my goblin ways to show them how much of a force I really was. I cut 10-15 of every gem cut I had and listed everything at 8-10g. Within an hour everything had sold (to my competition) and they backed prices back up to the 40-50g mark. Since then they havent bothered me when I reset markets. They still undercut me but never more then 1g which is fine with me.

Hopefully you can still get the point of that story as I don't think it was very economic based but at least it gives you a scenario that is possible to compete with heavy competition. I'm technically a nobody when it comes to auctioneering and playing in the AH. I'm sitting on 30-35k liquid while my competition is sitting in the 70-100k liquid range and yet here I am playing hardball with them.

Be a strong presence and show them that your not going anywhere. Let them buy out your cheap gems / auctions and just post up more. It really aggervates them when they can hear you cutting more of the same gem as they just bought 15-20 of your gems. As long as your making profit it doesn't matter who is buying your stuff because really all they are doing is funding you to be an even stronger competitor.

Now if you don't have competition that's willing to buy out your auctions and just undercut you then the only suggestion I can really give is to post smartly. Add them to friends and post when they log off or leave a city. Post during peak hours and during raid times because your surely not going to win against brute strength. Never post more then 2-3 gems and never longer then 12 hours. If your getting undercut alot it's better to sell 2 gems and lose the sale of another gem then it is to post 10 gems and sell 2 and get undercut. That's another reason my competition was buying out my gems. I'd only post 1-2 of the gem at a time instead of flooding the market. Take advantage of their errors and eventually you'll show them your not going anywhere. :)

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