Analysis of the Post-3.1 Economy

We’ve now had two weeks to assess the impact of patch 3.1 on the WoW economy. The general consensus has been that, while there were a few areas of opportunity, the Northrend economy overall is in a state of continued decline. We are certainly no fans of assumption here at WoWenomics so we chose a few items, specifically those items we based our own pre-patch predictions upon, to track with standard financial analytics. It is this analysis we share with you now.

When looking at the statistics below you may notice that there are three weeks of listed tests. The purpose of conducing three weeks of testing was to establish a baseline in the week prior to the release of the patch. Bear in mind that the day the patch was released to the (US) public was Tuesday, April 14th. The data listed below reflects the week of prices leading up to this date and the two-week period following.

Items we Predicted Would Rise in Value

Borean Man O’ War

3 week high: 40.84 on Sunday, April 19, 2009
3 week low: 18.51 on Monday, April 27, 2009
3 week average price: 23.22

after-3-1_1-borean-man-o-war

Of all the items we predicted an increase in price for, Borean Man O’ War saw the biggest increase in value in terms of percentage increase. This was particularly true if you invested when we initially recommended a buy on this item.

Eternal Earth

3 week high: 7.16 on Saturday, April 25, 2009
3 week low: 4.68 on Wednesday, April 8, 2009
3 week average price: 5.53

after-3-1_1-eternal-earth2

While we initially recommended investing in this item prior to 3.1 we amended our recommendation based on data that was released shortly before the patch was released. Yet, Eternal Earth still managed to increase in value over our testing period. Not a huge increase mind you, but an increase nonetheless. Interestingly, all three of the eternals we tested showed a spike in value on all servers in the days immediately following the release of the patch.

Eternal Fire

3 week high: 28.64 on Wednesday, April 16, 2009
3 week low: 18.97 on Wednesday, April 8, 2009
3 week average price: 21.95

after-3-1_1-eternal-fire

Prices for Eternal Fire have remained mostly stable showing only a modest increase over the three-week examination period.

Eternal Shadow

3 week high: 6.89 on Thursday, April 16, 2009
3 week low: 3.94 on Wednesday, April 8, 2009
3 week average price: 5.19

after-3-1_1-eternal-shadow

Interestingly, all tracked eternals showed their lowest prices on the same date. As the price increased from both the date of our prediction and the week prior to the patch date, we consider this prediction a success.

Gems

Initially gems did not show much promise for profit following 3.1. Recently however, the gem market seems to be showing promise. This reflects the fact that players are now attaining more new gear through both Ulduar and Arena Season 6.

Glyphs

The profits to be made in the initial days following the release of 3.1 were meaningful and well documented. Our resident inscription expert remarks only that “things have cooled” significantly since then.

High-end Cloth- Moonshroud

3 week high: 96.45 on Wednesday, April 8, 2009
3 week low: 81.82 on Tuesday, April 28, 2009
3 week average price: 88.97

after-3-1_1-moonshroud1

We chose to track Moonshroud for several reasons; the most prevalent being that we feel it has the highest potential for increase. That said, the price of Moonshroud has thus far not increased outside of specific price spikes described in our summary below. Further, the decline in price is representative of the decline of the other two types of high-end tailoring cloth. In fact, were you to lay the charts for all three cloth types over one another you’d find that they decline at an almost impossible to differentiate rate although the price points are different.

Icy Dragonscale

We chose not to track Icy Dragonscale statistically due to the fact that it experienced a very modest increase in price. In fact, the only remarkable thing about this leatherworking item, in our opinion, is just how unremarkable the price changes were. The prices of the dragonscales have remained at almost the exact same levels for the past three weeks indicating that, perhaps, the market had ‘bottomed out’ previously and this item has achieved some level of price stability.

Mana Regeneration Items

We did not track a specific item to represent mana regeneration as we feel there are simply too many options available to the player to enhance mana regeneration. We do note, however, that we’ve seen a modest increase in the going rate of +MP5 food and gems.

Popular Enchantments and Enchanting Materials

As we noted recently, we’re doing a brisk and healthy business in already-enchanted vellums. Beyond that, we are seeing server price spikes in specific enchanting materials but nothing consistent. If you’re in the enchanting mats business you’ll have to frequently check the AH so as to determine when best to buy and sell.

Relic of Ulduar

These reputation turn-in items have not yet shown a significant increase in price. They have performed instead in similar manner as the Icy Dragonscale listed above. The only interesting thing about these relics is that it is the single item that seems to have found a consistent price that is very close to being the same on all servers (the Icy Dragonscale, by contrast, is consistently in the same price range day after day but that price point varies from server to server). The Relic of Ulduar price is about 2 gold per item across every server tested. Prices for the past three weeks have varied by less than 5 silver from this standard on any given day and, remarkably, this remains the same price level whether the items are sold in stacks or as singles.

Titansteel Bars

3 week high: 102.39 on Tuesday, April 7, 2009
3 week low: 77.82 on Tuesday, April 28, 2009
3 week average price: 92.66

after-3-1_1-titansteel-bar2

Titansteel Bars have been the biggest loser so far in our pre-3.1 assessment. Prices have continued downwards in steady decline for the past three weeks outside of occasional price spikes unique to each server.

WoTLK Flasks

Flask prices have not been specifically tracked as they are a different beast entirely. The two-for-one flask split further complicated the issue. That said, we made a huge amount of gold off of flasks with the release of patch 3.1 and will, perhaps, explore the potential for flasks in a future post. Suffice it to say, for now anyway, that flasks are one of the best items to apply the bid/ask strategy to as it can prove very profitable.

WoTLK Herbs

There was no significant increase in herb prices outside of the occasional herb spike. We theorize that the majority of the scribes and alchemists intending to profit from patch 3.1 bought their herbs earlier rather than later. Herb prices have remained, for the most part, consistent throughout the patch.

Items we Predicted Would Fall in Value

BoE Valor Bracers

The decline in price that we predicted for these bracers is difficult to quantify as there is no simple way to track all the various bracers available and the items are typically sold ad-hoc rather than pre-bought and resold on the AH. Anecdotal evidence, however, supports our initial prediction for decline in that the messages observed in /trade chat by all WoWenomics team members clearly shows the asking price for the bracers to be dropping.

Dragonfin Angelfish

3 week high: 60.81 on Friday, April 17, 2009
3 week low: 44.16 on Sunday, April 26, 2009
3 week average price: 53.82

after-3-1_1-dragonfin-angelfish

This item is in slight decline although it is not for the reasons listed in our initial assessment. Rather, the decline here is caused by over fishing. We’ve provided a more in-depth analysis of the post-3.1 fish market here.

Frozen Orbs

3 week high: 92.75 on Sunday, April 12, 2009
3 week low: 70.16 on Sunday, April 26, 2009
3 week average price: 88.23

after-3-1_1-frozen-orb

Frozen Orbs continue to decline in value although it is difficult to differentiate whether this is due to the deflationary effect or because of the reasons mentioned in our initial hypothesis.

Mycah’s Botanical Bag

3 week high: 284.77 on Friday, April 10, 2009
3 week low: 159.18 on Monday, April 27, 2009
3 week average price: 225.16

after-3-1_1-mycahs-botanical-bag

This item has declined significantly since the release of patch 3.1. There is a steep drop in price a few days after the release that we attribute to the introduction of the new and improved herbing bag to the general WoW market.

In Summary

It should be said right off the bat that it is much easier to predict a decline in the price of an item in WoW than it is to predict a gain in value. This is mostly due to the previously established deflationary effect occurring within the overall game economy. Unfortunately you can’t short WoW items. So, while we did end up being entirely accurate in our predictions for declining value, this alone is not much to be proud of.

As far as our predictions for price increases go, we still reason that some of these increases may still occur as the new crafting patterns drop from Ulduar but, the fact is, the demand spike for materials will be small and short-lived. We’ve already seen examples of this on all of our test servers actually. Situations occurred on all four servers wherein the prices of a certain item like Ebonweave spiked significantly in a single test but prices were almost always normalized by the next test approximately12 hours later. These price spikes were not shown in the results above because they occurred at different times for each server and were thus normalized when combined with the statistics of other servers. What this does tell us, however, is that there is still opportunity for an individual to profit by timing their sales of specific high-end items with the spikes that occur on their own servers. Whether or not you’re interested or capable of watching your server’s economy that closely is, of course, a different story. We do advise that you check frequently, or otherwise liquidate strategically. We do not advise holding items for the long term as that strategy is counterintuitive to the overall WoWenomics game.

We will be continuing our testing and tracking of the prices of the above listed items (and a few others) over the next few weeks as we continue our analysis. If there is enough interest in these types of posts, we’ll put something together and share our results with you.

A Few Notes on Our Testing Methods

It should be noted that all of the listed prices are in the ‘Fair Price’ format, a price measurement scheme that is explained on our Terms page in detail. The listed value of items is the fair price of the items as listed in the Auction houses of four servers. The prices that we show are the average of the listed prices on all four servers. Prices were measured at two points during the day and on both horde and alliance sides. Thus, the final listed ‘Fair Price’ that we tracked and shared is the average of both day and night prices over four servers on both the horde and alliance sides. Prices were measured at the same time daily on each server for the sake of consistency. A fifth server was also tested but not factored into the above listed prices as a control test for our results.

On the day that patch 3.1 was released to US servers, April 14th, data was not recorded due to server stability issues. Therefore, the data listed for April 14th is an average of the day prior and following day’s data. Similarly, on Tuesdays following the patch, servers were unavailable for AM testing times so only evening data is listed. We don’t feel either of these averaged scores significantly affected the outcome of our tests and only mention it now in the interests of full disclosure and transparency.

On a personal note I’d like to send a big thanks out to the WoWenomics team members for measuring and recording their data and returning it in a clear and timely fashion.

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11 Comments

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

11 responses to “Analysis of the Post-3.1 Economy

  1. Awesome article and blog guys. How did you collect the data used in your charts? Was it a manual process or do you use an addon?

  2. I did not read blogs recently and just catching up. Great work!

    • jederus

      @ Rorik- All manual. We know there are other ways to automate the process but we don’t feel they give an accurate price as to what you can expect someone to actually pay.

      @Gevlon- Thank you sir! Always an honor to have you stop by. Glad to see you found your guild and are ‘back in the game’ as they say.

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  4. I love your detailed (obsessive?) approach 🙂

    Over the past couple of major patches (3.0.8 and 3.1), it seems that the general strategy of stockpiling items that would rise in demand after the patch, then selling quickly for windfall profits, has been blown apart. Dream Shards and Eternal Life at patch 3.0.8… glyphs and Titansteel at patch 3.1 are examples.

    All of a sudden it seems that there are simply far too many players trying to work this method. This actually drives the prices of increased-demand items *down* thanks to the flooding of the auction house (especially by lackwit players who don’t know how to post and price intelligently).

    My own method depends on holding items that have true high demand… as long as necessary in order to realize large profit margins.

    – Jon

    • jederus

      Hi Jon and welcome. We have to agree with you on the buy and hold strategy. The key, as you said, is knowing which items will hold value long term.

      We also have to agree with your usage of the term “obsessive” as this defines our approach quite well. Our goal is to be a resource with this sort of tested and proven data for those within the WoW community who are deeply involved with the economy (such as other WoW finance blogs).

      Speaking of which, to those readers not familiar with Jon’s site http://www.secretwarcraft.com/ we strongly advise you give it a look. He’s got some fantastic videos up, great tips available and a slick design methodology. An excellent resource for all.

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