Potent Flex - Farming for good deals

If you feel like this blog is just showing crappier and cheaper items, you're right! Good gear is hard to find, jeez. See how much I sold this for after the jump.

If you think this bow sucks, you would be right.

You don't have to look at the bow long to realize that it sucks. There is no crit damage, no socket. Just a bunch of dex to keep you interested. If you take a look at this post, you'll see that the lack of socket costs the bow about 200 weapon dps. The 155 bonus dex, although high, is only about an 8% gain on dex, which translates to around 80 weapon dps. That means the bow is about as strong as a 1125 - 200 + 80 = ~1000 dps bow with a socket, which is in the "magical bow with socket" territory. Not extremely valuable.

Why did I even write a post for it?

Well, this is the first good item I found in the game. I didn't even look up the value at the time because I was almost certainly going to use it for farming. And you don't sell stuff you farm with; it's equivalent to biting the hand that feeds you. Unless of course you are on vacation and want a good laugh. But anyways, there's not much to say about this bow, so let's jump straight to the selling price. Scroll down to see it.

6 bucks?

Followup:

The sell price may look absurdly low, but it's actually pretty good. It illustrates the gold to $ conversation ratio that I'm going to talk about in this post.

But first let me clarify what 6.80$ actually means. The original sell price was 9$. A flat 1$ fee is then imposed, which turns it into 8$. Finally, Blizzard takes a 15% cut, which leaves me with 6.80$. I'm not going to debate the merits of that 15% cut (quick opinion: Sucks, live with it). What's more important here is knowing what the original selling price was.

There is a implicit relationship between gold and real dollars in this world. A gold farmer may charge 2$ or even less for a million gold. Someone on the forums may be offering gold at 1.40$ per million (and probably attempting to scam you). Whenever you sell an item on the RMAH, that item has a implicit gold value (what you could have gotten if you sold it for gold) and an explicit $ value (what you sold it for).

A good deal, in my mind, is when I maximize the "$:gold" ratio whenever I sell something on the RMAH. If my bow is only worth about 2m on the gold auction house, and the ratio is 2$/million gold, then I should probably list my bow at around 4-5$. Otherwise, a smart RMAH buyer would just buy gold and get the bow from the gold auction house.

My bow was actually worth around 3m at the time I decided to sell it. But I posted it up for 9$. And someone actually paid 9$ for it. I'm sure you can see how I got a pretty good deal. The common ratio is only 2$/million (and some hardasses believe it's even less), so I should have only posted it for 6$. Where do I get the balls to list it at 9$ and attempt to make a 50% profit?

The key concept to understand is that every market for goods has a different "$:gold" ratio. My theory is that items in-demand for beginners are going to have a higher "$:gold" skew than items in-demand for high level players. This is because beginners don't have gold to throw around, and are forced to use $, which drives up the $ cost. On the other hand, high level players have plenty of gold to throw around, and are less forced to use $. This drives down the $ cost on high level items (up to a cap).

Let's give 2 examples.

Example 1:

my bow

Pro: Beginners look at the high damage/stats and feel that it's powerful.
Pro: It's cheap
Con: It's not actually good for a high end player because of the lack of bonus critical damage.

This has a high "$:gold" ratio because beginners look to buy this. Good players will completely steer clear of bows with only dex and no sockets/crit bonus. The market for these types of weapons will be skewed towards $.

Example 2:

30m gloves if I've ever seen it

Pro: These are amazing. It's a perfect 6% crit roll that only shows up on ilvl63 items only.
Con: It's not cheap in gold or $. 
Con: Beginners will steer clear of this because it will cost way too much $.

This will have a relatively low "$:gold" ratio because only a high level player would buy it with gold. A beginner would simply pay less for something with slightly less mods. The difference between a 170dex/6 and a 180dex/6 is in the millions. When an item has a clear and well-defined maximum value, the price scales (I'm gonna just say log-curve in this case, it really depends on how hard it is to roll these) as you reach the max value. For that reason, a smart $ spender will not be buying the best of the best, but rather something cheaper that sits on his value curve.


What is the takeaway here? Sometimes it's not always wise to sell something for $. You might want to trade your item for something else that is in a high "$:gold" market before attempting to sell it. It is also important to identify these markets with experience. And I'll tell you for a fact it's not high dps socketed bows. Those things never fucking sell.