World Of Warcraft, WoW Hand Armor

Saturday, January 29, 2011

Things in Life Aren't Free- But in WoW They Are?


Alot of folks have different optinions on what is actually "profit". We have all heard the "I farmed it so it's free" line, which, in all reality it's true. You did spend the time to farm, and it was "free". We have also heard "well, it procced on the transmute, so it's free", which is also true. But I don't see it either way, and neither should you if you have the same mindset. Let me explain:

"I farmed it so it's free":

How long did it take you? What was your GPH (gold per hour)? Did you stop and take a second to check it out? How did you factor it in?

Ok, so you were in Twilight Highlands farming your Elementium Ore for an hour. You ended with 160 ores. A few green gems, and a blue. Oh yeah, 6 Volatile Earth, 2 Volatile Fire. Was it worth it?

8 stacks of Elementium: 720g
3 Pyrite Ore: 36g
Green uncut gems: 40g
Dream Emerald: 35g
6 Volatile Earth: 75g
2 Volatile Fire: 45g

Total is 940"ish" gold. Alright, not too shabby. But that is just the start. "It's all free". So you mail the ores to your gemmy, and prospect them. You end up with 930g worth of gems (AH price). So is that your GPH now? What about when you take the gems, cut them into Alicite Pendant, Jasper Rings, Carnelian Spikes, and then D/E them? Then you are looking at around 1100g? But is it still "free"? Now you notice that Nightstones are the Jewelcrafter's daily, so you get 80g each for the two that you got from prospecting. Now we are looking at almost 1300g. See where I am going with this? Sure, just from farming you can sell your "mats" straight out, and clear 900g. But spend a bit more time and you get 400g more. I know this is total common sense, but try to get in this mindset on what you can do with your time. This example can work with many different types of farming, so place yourself in your normal farming situation and go from there. Next.....

"Well, it procced on a transmute, so it's free"

So you are doing your daily transmute of Volatile Life to Volatile Air. Or Truegold. Or when you made your Jasper Rings, you procced a Blue one. You procced 3 on your Truegold transmute, and you want to sell them quick, so you hit the AH and toss em in for 100g UNDER the lowest price. You just lost dough buddy. Instead of them being free, you now have to pay for that Potion of Treasure Finding out of your own pocket, instead of using the system to pay. Get it? Got it? Good.

"I can sell it cheap, because I wasn't even expecting it, so it's free"

Wrong. And right. If you sell it cheap, you are losing money. This is once again common sense, but it seems that people don't see it that way. I see that Blue ring selling within a few days for 200'ish gold. But others seem to not do that, D/E it, get a Small Heavenly Shard (worth about 17g), and go on. That, my friends, is a loss. Not a "free" 17g, but a loss of 180g. But once again, it was free (as I am told)......

Ok. Now this is the one that burns me the most. Listening last night to JMTC reminded me of this. To each their own, but you are reading this because you care about my point of view, and here it is....

"Well, when I mill, I make my money back on Inferno Inks, so the Blackfallow Inks are free"

This one for some reason is my biggest pet peeve. Sickening. Now you are probably thinking "this alto's full of shit, why does this bother him so much?". Or you don't care. But tuff, I am gonna tell you anyways. Folks like this piss me off in a few ways. One, they lower the price of Blackfallow on the AH to next to nothing. Which in turn lowers the prices on Mysterious Fortune Cards. Which affects my bottom line.

Now before you say "Alto, you do the same thing, isn't that a contradiction?", Yes, I do "near" the exact opposite. I mill, sell my Inferno Inks, and use my Blackfallow Inks for other uses, unless the Inferno's are full of competition, then I will make Destruction Cards or just sit on them. I don't kill (flood) the market and make the prices lower to zero worth. Bah.

So as usual, I started going off and rambling for a bit. Yes, this is all common sense once again. Things in Life Aren't Free. Ever. Ore are they?


*pic is used from http://www.famousbloggers.net/

7 comments:

Altolycus said... Reply To This Comment

Once again, another common sense post by Alto (for the most part), but my question to you is what category do you fall into? What is your reasoning behind it?

Nev said... Reply To This Comment

I'm of the mind that procs are a nice bonus. I don't factor them in immediatly when I'm calculating profits for that time, they go in my bank or off to an alt that can use them but when I'm deciding a sale price later on a crafted item, I factor them in at market price. Blue rings/necks always go to AH & I always list at sensible prices, even if it takes me a week to sell them.

As for blackfallow/inferno's - I tend to buy herbs at a set price, divided by 5 gives me my minimum for listing MCF's & any inferno's are then stored until I can get enough together for a darkmoon card. I tried selling both inks but they just don't seem to move very quickly.

Not sure that quite answers your question but I guess you get the idea :)

anaalius said... Reply To This Comment

I agree that it can be quite hard to determine how much profit you are earning, here is my opinion.

Just do what you think is good. if your gold is capital is rising your doing something right. kinda simple really but when you analyse to decide what is most profitable I tend to end up wasting time, digging too deep to structure what I should be doing.

If you spend equal amounts of time on various markets and one of them is not bringing in much income, either focus more on the success your having in some markets or spend less time on your less productive areas whilst trying to reap the same rewards.

Its quite hard for me to expain but my value of time changes quite a lot depending on how long I will be playing and the monotany of certain tasks such as farming. This leads me to just try diversify as much as I can between proffesions. restocking when items sell. Tends to work quite well. But ultimatly I just use Gold per hour as a guideline.

xoxo anaalius

Azuriel said... Reply To This Comment

I would never understand the people who think the proc is "free," especially for Alchemy. Isn't the entire reason you are, say, an Xmute master FOR the proc? Did you just pick a specialty at random?

Kammler said... Reply To This Comment

"We have all heard the "I farmed it so it's free" line, which, in all reality it's true. You did spend the time to farm, and it was "free"."

I can't disagree more.

It was not 'free' if you spent time doing it. Also, if you are figuring your downstream GPH for milling, prospecting, cutting, etc. you have to calculate the time it takes to do the milling, prospecting and cutting. 160 ore? How long did it take you to prospect 8 stacks? Then to cut the gems? Did you have mail the gems to another toon?

If 940g was the base and you get another 500g in gems, but it took 20 minutes to get there, now your 1440g is divided by 80 minutes, not 60. So your GPH goes down.

But all this analysis ignores the REAL value of time--opportunity cost. How much could you have earned doing something else INSTEAD OF mining, prospecting and cutting?

If I can buy 20 stacks of ore in the AH for 60g each, I just invested 1,200g. It took me about 1 minute. Now I spend another minute going to my mailbox and getting the ore. I then spend 4 minutes prospecting, 5 minutes crafting and 5 minutes DE'ing the crafted items. I list the resultant blue rings, Hypnotic Dust and Greater Celestials (and the few uncut gems, and the one or two cut ones).

In 15 minutes I turned a 1,200g investment into 2,300g to 2,600g materials in the AH. Even if my time is doubled to 30 minutes the resulting 1,100g to 1,400g profit converts to 2,200g to 2,800 GPH.

The resultant greater GPH from buying the ore is more profitable. Thus the statement "I mined it so its free" is a fallacy. You mined it and it cost you 1,200 GPH in net losses for having done so. You could have spent your time in a different manner and earned more net profit.

This basic principle is key to understanding the best way to invest time in earning gold. Are procs free? To some extent, but when you selected Transmute Master you were counting on some procs, right?

Then the opportunity cost of that proc is compared to what might have proc'd if you selected a different specialty. Are you transmuting enough every day to see a significant number of procs? Then you may be earning more than if you had a different specialty.

I like your column and agree with most of what you have to say, but the value of opportunity cost MUST be calculated. The failure to do so is one of the biggest reasons you see Deep Undercutting as a strategy--people often mistakenly correlate the time they spent gathering as "free materials". It is decidedly NOT free.

Snakeoil said... Reply To This Comment

And in the end we come to bots, would you be able to buy that cheap stacks after stacks of ores in AH if there were not automated bots filling the shelves? No you would not. I so love the outland or vanilla content materials which are not botted (until the idiots realize that the markets have shifted). There's no point to farm manually anymore until the blizzard have some solution to massive bot usage. Until then you can havoc the below 54g Obsidium ore stacks or what not and make profit of that. Or you can shift out and go farm BC ores yourself or even better buy cheaps from AH from people that mine ore while leveling. And sell them in bars and mercurial adamantites.

Currently state of WoW economy is sickening in my opinion. And I do sure believe that it is not my server only, EU-Frostmane.

Altolycus said... Reply To This Comment

You know, I think one of the main reasons I write is to read the comments. Thanks all! Great advice!

You all make me feel warm and fuzzy. And not in a creepy way. Like I am wrapped up in a blanket sipping on a Bud next to the fireplace feeling. Naked. Typing this right now.

Ok, that was a little creepy.....and also a lie. It's a 40oz. In a brown bag. And it isn't a fireplace, it's a burn barrel. And I am not naked, I am wearing a shoe. Yes, that is singular. One. On the wrong foot. Without laces. Ok, you are right, it's velcro.

Alright. I am done. If you didn't laugh there somewhere you need to see the doctor.

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