Tuesday, April 26, 2011

A Sprinkler System Approach to Goldmaking

While reflecting on my options for the upcoming 4.1 patch, I finally grasped a concept that has been floating around in my brain undeveloped for a few months now.  I realized that even though our instincts tell us to always make the highest priced item and sell that, that is not the way to maximize your income.

Most of the markets and niches that exist in the WoW economy can be derived from three main sources: herbs, ore, and drops (greens, cloth, etc.). When you buy herbs, you have a large number of options available to you for processing these herbs. You can make potions, flasks, glyphs, darkmoon cards, ink, and other things to list on the auction house. Before I understood that there is not unlimited demand, my goal was to make the most expensive item I could out of them - Darkmoon trinkets. (herb -> pigment -> ink -> dmc -> deck -> trinket)  I spent countless hours milling and making inks, only to realize that I could not move them as quickly as I wanted to.

So, I started selling decks and trinkets. My profits went up, even though I got a smaller ROI on my herbs. I went even further, and started selling cards, decks, and trinkets. Up again went the profits. I continued in this vein until I was selling damn near every thing I could make with herbs via inscription, and my income skyrocketed to over 10k/day net. Sure I was spending more money to make this much, but that's ok - I had the capital to do so.

The point I want to impress on you is that when a goblin tells you to diversify, he isn't necessarily saying that you need to level a new profession or alt. That goblin is simply telling you that you need to find more avenues to use in order to increase the volume of your sales. There is a finite amount of demand in a server, and no matter how many thousands of glyphs you post - there is only going to be a few sold, and that amount isn't going to change very drastically no matter the price. To increase your profit past that point you have to sell something else.

Picture your products as a drip sprinkler system. At each designated point, a little water seeps out (a sale). The more holes you have, the more water gets out. The more water gets out, the happier your lawn (bank account) is.  The water left in the hose is your inventory, and the less there is the better, because you know that all that water went towards a happy lawn.

This is why Blizz is nerfing the shuffle, incidentally - because a sprinkler system with an open hose at the end, on the sidewalk, doesnt make the grass greener at all, it just uses up all the water. =)


  1. I found out the exact same thing. I have been making a fair amount from glyphs and such in cataclysm, but my income just exploded when I decided to spend an hour a day milling and watching Californication.

  2. That is the big question, whether they'll nerf shuffle or not )
    We will find an answer, when US servers will be up.