Northrend Economic Assessment- Part One

Over the past few weeks we’ve been conducting some research and testing in regards to the prices- and more specifically the movement of prices- of Northrend items. Our two-part series on the market for Northrend goods begins with an exploration of our collected data and a discussion of the price fluctuations that we observed. The second part of our series will focus more on what we see as the future direction of prices of Northrend goods based on both our testing and the probable impact of coming patch 3.1 changes. The second part of this series will be published on Tuesday.

Part One of Two-
The Current State of the Economy

Trend analysis is a tool used in finance to determine the probable future movement of financial properties based on the data collected from past movement of the same assets. For two weeks we applied our knowledge and experience of real world trend analysis to five Northrend goods. By analyzing the data collected on the prices of these items we’re are able to more accurately asses the future direction of prices of not just the items we studied but the economy overall.

The five items we studied in this round of analysis were:

Frostweave Cloth-stack
Saronite Ore-stack
Goldclover-stack
Infinite Dust-stack
Frozen Orb-single

We feel that these five items represent a good general cross section of the economy for Northrend goods. The following is our data and analysis of these items. Note that the blue lines on the charts represent Going Rate and the Red ones Fair Value, concepts explained in more detail on our Terms page.

Frostweave Cloth (stack of 20)
two-week-test-frostweave-graph
Frostweave is on the decline. This item is easily collected by all players actively playing the game, many of whom have already made enough bandages to max out their first aid skill. This leaves tailors as the primary buyers of this item and many of them have already crafted the items that they want for their own toons. Further, high-end crafted tailor goods are also declining in price as many players have attained superior items from raiding and other PVE content. Frostweave cloth declined in price approximately 15% in the two weeks we studied it.

Saronite Ore (stack of 20)
two-week-test-saronite-graph
Saronite Ore is also on the decline. The reasons for this are similar to the reasons for the decline we saw in Frostweave in that the demand for goods crafted from this ore is also decreasing as players progress through content. Overall, prices of Saronite ore went down about 10% during our study. The loss in value would have been greater were it not for the gem crafters of Azeroth prospecting this ore.

Goldclover (stack of 20)
two-week-test-goldclover-graph
Goldclover also lost value during our two-week study. Reasons here are similar to those already mentioned for other Northrend items although it should be noted here that Goldclover is a very common ingredient in consumables for which, unlike crafted gear items, there is always some amount of demand. Goldclover retained its value best of all the items assessed during our study, having only gone down approximately 7%.

Infinite Dust (stack of 20)
two-week-test-infinite-dust-graph
Infinite Dust also retained its value comparatively well having only decreased in cost approximately 8% during our analysis. We attribute this to the fact that, in addition to being a key tailoring material, it is foremost an enchanting item. As enchants have the same continuing demand effect as consumables, the lesser level of value loss is not entirely surprising.

Frozen Orb (single item)
two-week-test-frozen-orb-graph
Of all the items we studied, Frozen Orb declined the most having lost some 18% of its sell price. We attribute this again to the reduced demand for high-end crafted items compounded by the fact that more players are now progressing through PVE content (in this case specifically heroic instances) so there is also increased supply.

Overall our analysis did reveal a few trends that we found interesting and wish to bring to your attention. Most notably was the fact that all of the items listed below did not go into a straight decline in value. While by the end of the two week study they did all go down in value, there were days when the items sold for more and days when they sold for less. This is why if you look closely you’ll notice that the lines are not a straight downward slope. Instead they seem to have waves or bumps in them. Closer analysis revealed that on certain days of the week prices across the board were up. This is something we were already aware of and have shared with our readers previously. However, overlooked in our previous analysis, was the fact that there was also a day of the week when prices of all five items were lowest. Specifically, while Saturdays represented a high point in prices, Wednesdays came out to be the day of the week when prices were lowest. Savvy traders will take this into account and time their bids and sales appropriately.

A note on our testing methods:

Testing was conducted over three servers. Two United States PVE servers and a US PVP server were used. The testing servers were selected based on an even (or as close to even) horde vs. alliance auction house balance as reported on Warcraft Realms. The two week period that we used to collect our data started on Saturday, 2/22/09 and ran until Friday, 3/6/09. Both horde and alliance data were recorded and subsequently averaged together to produce a single price point. All listed prices were for buy out prices. Bid prices were not considered at all. Analysis was done by hand; no add-on or scripting tools were used. Note that there are two prices displayed per line item, this is so that we explore both Fair Price as well as Going Rate- concepts that are explained on our Terms page.

Our data and testing is not intended to be a direct representation of your experience with similar items. Rather, we hope that the testing we conduct gives you a general insight into the overall price of these items that you can then use to determine your own approach to buying and selling Northrend goods. As with all financial advice, YMMV.

We hope you found this analysis beneficial. Stop in next Tuesday for part two of our analysis and learn what you should be stocking up on or selling off before the next patch hits.

Edit: The second part of this analysis has been published and can be found here.

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8 Comments

Filed under WoW Economy News, WoW Gold Making Tips, WoW Market Data, WoW Market Index

8 responses to “Northrend Economic Assessment- Part One

  1. Cipri

    I haven’t paid too close attention the past few weeks, but was there any major downtime in the data collected? I’m sure that measurements like this would be influenced by an 8 hour downtime, since that resets a large portion of the auctions on the AH.
    Also, did you look just at full stacks for the stacked items, or also at the various stacks of singles that pop up a lot on the AH?

    • jederus

      An excellent question regarding timing Cipri. All data was collected at the same time of night each evening for two weeks to account for down time and server population increases. All items were compared in full stacks save the Frozen Orb as indicated in the analysis header for each item. Singles were not considered for this evaluation.

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