WOW Trader Segment #4

Welcome to wow trader your source of wow auction house epic knowledge. Miy here and recently I received an email with an auction house question, allow me to read a section from it.

Dear Miy,
One aspect of WoW commerce that I'd like to hear your views on is how to deal with demand shifts and how to handle them when the demand price is relatively inelastic. For instance, I always found Cobra Scales to be frustrating. They sold for 45-50g each pre-WotLK and I found them very easy to farm as a BM hunter. I could produce a full stack of 20 in 2-3 hours when I was on a roll.

The problem was that demand would shift frequently. Some weeks I'd have to repost them 10 times, other weeks they'd sell before I closed the AH window. However, the price didn't vary significantly from week to week. How do you handle these changes in demand which are not apparent from Auctioneer data alone?
From Miy admirer.

Well Miy Admirer, I am glad you asked because this is a wonderful topic to base today’s discussion on. So for today’s wow trader we will discuss the shifts within the auction house.

Well first lets talk about the different types of shifts. There are two types of shifts and they are shifts in demand and shifts in supply

Generally speaking the shifts in demand and supply affect the price, however there is often a delay between action and result, so that a singles days shortage in supply is not enough to affect the long term price of an item. This explains why those cobra scales did not change in price even with shortages or an excess of product. Sellers were used to selling them at that price and buyers were used to buying them at that price so the market stayed relatively stable.

As for the shifts in demand, to some extent this is predictable, days when more people log on, there will be more activity on the auction house. Weekdays will generally see less activity. However there is also a random element to all of this, some days will just have more activity then others as a result of the random choices of players. This occurs often because players spend a week or two farming, and then when they start running low on gold they try to unload all their items at once to get the gold they need.

So how do we deal with these shifts, and how can we be profitable with them?

Well first off shifts in supply and demand are somewhat predictable. They often revolve around gear. Whether it is the purchase of gear, the purchase of items to make gear, the purchase of items to improve gear, or the purchase of items to help go and get gear, it really all comes down to gear.

Gear is the one thing that drives the economy so by tracking gear we can track the shifts in the auction house economy. Some of the following effects will cause shifts. 

 New patch = new gear, demand shifts to the right
 Raiding is hard = people min maxing, demand shifts to the right.
 It is a raiding night = people get new gear, demand shifts to the right.

The lack of these conditions shifts demand to the left, which is actually the current state of our economy.

Supply is a little more fickle, generally we have two types of providers, the career auction house players who are always posting items on the auction house, and those who sell stuff they have accumulated from farming or from leveling their trade skills whenever they need gold, or want to create space in their bank. 

So now we understand why they’re shifts on the auction house, we have to ask how can we make a profit off of this?

For this week I will just say sell when the supply low and demand is high, and buy items when the opposite is true. You also want to become a regular seller, each day, place a few of each item you want to sell on the auction house, this allows you to avoid losses from auction house fees if items don’t sell, and by regularly placing items on the auction house you help to maintain a steady level of supply and demand, and steady profits.

Next week we will go into how to predict shifts in supply and demand and how to use this information to maximize profit.


Thanks for listening to Wowtrader your source for papa hummels biscuits for your wow wealth. This is Miy saying may your gold flow like the blood of your enemies, for the horde!