Playing the Virtual Markets

If there's one thing that has utterly captivated me about WoW, it's the auctioneer add-on.

Before the black hole of Aion sucked me into its addictive grip, figuring out how the add-on worked took me step by baby step towards the theory of amassing lots of profit by selling many many things fast at a small level of gain.

It helped that WoW is a mature market, with max levels looking on 50 gold as just another daily, so few players blink twice at dropping a few gold here and there to twink their next alt out.

This eventually led to a crazy disparity where I had amassed a grand total of 12 gold from questing and killing low level mobs, and 500+ gold in the same space of time (a month) from the auction houses - just by selling unwanted lowbie materials and stuff to fuel professions I wasn't going to level.

I didn't even bother to buy low and sell high, which is one of the well known profiteering ways - to act as a middleman.

Auctioneer helped to automate it all. It scans the auction house, has a average price in its database, adjusts it based on the current state of the market and prices at a 10% undercut to aid fast turnover, while still making a profit over vendoring.

Truth to tell, I was amazed. Gobsmacked. Stunned by its glory.

And I never even explored all its other more cunning, customizable options either which searches out other ways to make profit, eg. disenchanting cheap items and selling the mats for high prices, scanning for badly priced cheap items and repricing them accordingly, etc.

It begins to strike me that the more inconvenient or complicated something is, the fewer people attempt to do it, the more your chances increase of finding a profitable niche to work in.

Subconsciously, I was seeing this in a Tale in the Desert. It's bound to be there in WoW. And I am now dipping my toes into the economic waters of Aion based on what I've picked up re: WoW and ATITD.

And me being such a crummy numbers person and bad at economic theory and what not. :/

I'm taking quite a gamble here, because Aion's economy confuses me and it's still fairly new, so there are some big fluctuations every now and then.

But then, big fluctuations are where the profit is made, wot? :p

It's weird because I have an odd feeling that much of the economy is going to end up built on the backs of grinding bots who are killing two birds with one stone for the gold-sellers (aka grind for gold and PL at the same time.)

There are crafting items known as Fluxes (Armor Flux, Weapon Flux, Accessory Flux) that have a drop rate. A rather crummy one at that. You need these fluxes of a certain tier to make armor, weapons, accessories at that certain tier. And you need a lot of them.

Why? Because everyone only wants the 'proc' items. You see, when you craft, you make a white Durable Steel Sword, fer example. You have a chance of 'proc'ing to turn it into a green Noble Durable Steel Sword with much better stats.

As a result, there is a flood of practically worthless Durable Steel Swords nobody wants to buy, and desirable proc items that sell for quite a lot - the prices can get pretty eyebrow-raising and make you think that ultimately the only people affording these are the ones who buy gold (kinah is Aion's currency) off the gold sellers for RL cash.

(Boy, those gold sellers are profiteering. First they bot stuff 24/7, getting the Flux drops. They sell those Fluxes en masse to crafters, gaining kinah in the process. They then turn around and sell that kinah to players, who spend their kinah buying the proc items from crafters.)

There are a couple spots which do not fit so nicely into this economic theory, of course.

Abyss Points, I believe, get more important past level 25-30, and those are only gained by PvPing. You can buy pretty damn kewl gear for Abyss points, which would lessen the demand for crafted items, which get more exponentially expensive each tier. (Presumably, the ability to grind/find kinah increases, since even vendor items sell for 2 mil kinah at level 40-50.)

I am positive bots and gold sellers are pretty crap at PvP. Of course, there's bound to be people who want an edge who might buy kinah and bring the goldsellers into the equation, but at the moment, and if all keeps going right with Aion, there is the power of the zerg to contend with in PvP. It is the great equalizer. 1 cannot vs 10, or 50, no matter how buffed to high heaven his gear is. (More on this in a later post.)

The other part is that of self-sufficient crafters. Aion has an interesting way of 'encouraging' profession choice based on class, because at the end of the long grind, you get a title that adds a small bonus to your parry, block, or attack, or magic boost, etc. I doubt a sorceror is really all that interested in raising his Block rating, since he doesn't carry a shield anyway. So people tend to fragment into professions based on class, as well as choosing a profession that can craft their own armor as they go.

This has strange effects on the flux market, as when the hardcore folks hit a certain level tier, flux prices of that tier increase as they start buying it up for their gear attempts.

At the same time, prices of the lower tier decrease as they start clearing out their inventories and dumping stock, undercutting each other to get someone to buy up their 'junk.' (Meanwhile, the bots are still farming heaps of the lower tier fluxes and adjusting prices to match the plunging rate.)

It was almost by luck that I stumbled into an interesting niche on my server. The lowbie twink weapon or first gear 'improvement' purchase of the casual player.

A lvl 21 guildie (more of the casual group) was looking to offload some of his weapon fluxes, including Lesser Weapon Fluxes. He mailed 'em over to me free.

I wasn't actually going to bother with the iron/steel weapons anymore because I was already lvl 25 and looking towards titanium weapons for myself. (Except the titanium buggers cost a bomb, and I needed kinah to afford to raise my crafting.)

So what the heck, I had spare crafting mats for the iron tier, enough Lesser Weapon Fluxes from my guildie and me to make a Durable Steel Sword or two and hope for a proc - I needed to clear my inventory too of this iron tier.

I checked the Auction House (Trade Broker, in Aion) to see the materials prices, and was fairly pleased to see that there were a bunch lower than a reasonable price. I bought them up and managed to amass enough mats for 4 tries. (This decimated my already poor wallet to almost nothing, however.)

Some crafting time later, I had proc'ed 2 Noble swords and had 2 worthless pieces of junk. I checked the broker, to find about 15 of the worthless swords selling for 1.5x the vendor rate. Or rather, NOT-selling for 1.5x the vendor rate.

The vendor rate wasn't too horrible though, so I just sold them, wincing at the loss. (I later calculated it at about -7000 kinah each.)

I put up one Noble Sword on the broker, undercutting by 10% the other 3 swords there, but it was still easily 6-7x the vendor rate and about 30k kinah in profit. (Each sword cost about 13k-16k kinah to make, said my back of the envelope scribbling.)

I was planning to offer the other Noble Sword to my guildie as a gift, since he was in the right level range and he did send me those fluxes. Just as I was headed to the mailbox, the Noble Sword sold on the auction house.

WTF. This fast? I was going to be about 40k richer? I froze, with my hand suddenly pulling my last Noble Sword back out of the mailbox slot, figuratively speaking.

Oh, what the heck. Greed took over, and I figured, I'm gonna put this up to see if this one sells. This is now the sword I was planning on getting profit from. The guildie doesn't know about his potential 'loss.'

The 40k from the earlier sword sale, I then used to buy up crafting materials for another SIX tries at the sword. (I actually had to pull out maybe 10-20k more from my wallet, can't recall.)

I proc'ed three.

Gawking, I kept one for the guildie, and ran to put up my other two on the auction. The second sword had already sold, so again I was 40k richer.

Getting into the swing of things, I dug out a bit more money from my broker than broke wallet, and bought mats for EIGHT tries, proc'ing two (or three, I forget.) It took some juggling of kinah as I had to vendor the failed swords to afford crafting supplies for the next one, etc.

Ultimately, it stands at 3 items on auction for over 40k each, 1 item in my stock for later auctioning, and 1 item given away to the guildie at a 'loss' - that's hopefully 120k-160k back in my pocket, which considering I started with less than 60k, isn't too shabby.

I stopped there because I was scared of pushing my luck any further. And I'd bought up everything cheap up to the limit of my profit calculation - I'd noticed there were some entrepreneurs who were busily processing iron for profit. Iron Ore + a vendor item + crafting = 1 Steel Ingot. Presuambly, they bought cheap iron ore and the vendor item, crafted it all, and then sold the steel ingots for a small 50 kinah per ingot profit.

That's about 15k kinah for 300 steel ingots, aka enough for 10 tries of a sword. But it's steady guaranteed profit, as long as the ingots sell.

Aka as long as gambler crafters like me take their chances and buy them up, charging the cost into our final proc products.

As long as someone BUYs the final proc product at the end of it, we are all good.

Hence, I am dabbling at this level 20 tier because the proc price is high, but conceivably affordable even to a normal player, as long as he's willing to spend a bit more and grind a bit more for a nice weapon to help him out in his mob/player killing.

I think for weapons, there will be quite some demand as it directly affects how fast you take something down.

Armor is trickier, because a weapon is a one time purchase per character, but you have to fill up 6 armor slots or more. Someone who will be all right spending 50k for a sword, would not be so cool with spending 300k for an entire armor set - heck, I don't see how he can get that amount of money if he doesn't play the market in some way. Grinding 50k is conceivable. 300k at that level takes economic balls.

Such as a teammate who said he made 300k by buying up some questing materials and parking himself by a questor overnight to set up a private store. "Get your gather quest materials here!"

Damn, but people are lazy. I never knew that so many would do that.

I see all those stores all the time, but I just go out and gather it anyway because I figure if I don't increase my gather skill, I will forever have to keep paying these folks through the nose because the tiers just keep going up and up.

The other thing that I am scared of is another weaponsmith turning up in my niche and turning it into an undercutting price war. I don't have the capital for a protracted fight, and I am really not sure if the demand will last. Judging by my observations of the folks in my guild, the casuals are just cresting the level 20 range right about now, the middle folk like me are in the 25 range, the hardcore wave is 30-35.

This is the first launch wave and the biggest. Subsequent level 20s are going to be people that have started later and are playing catch up (works out for me if they have a highbie friend twinking them out) and the slower folk who may not make it to 20 until quite later on. Really not sure if the demand will be as hot then.

I guess things will stabilize further once people start spreading out through the level ranges, and the too-casuals lose their focus and quit the game and so on. We'll see.