Undercutting

[Rolks]

So I had a conversation today with someone in my hunt party, and he brought up undercutting. When he said that you should undercut by only one gil, I told him that if someone does that to me, I drop my price by 1k. And he didn't like that. He said, that if you do that, the price drops, and all sellers lose money, but if you only undercut by 1 gil, then the price remains high for everyone.

No it doesn't. It remains high for you! Not for me, mine doesn't sell. If you like my price, then match it, don't undercut it. If you undercut by 1 gil, you're saying, "Hey, I like you're price, so I'm going to steal your sale." And I get screwed cause mine doesn't sell.

If you're going to undercut, then I'm going to go to a price war with you because I want mine to sell too. And I'm going to make it painful for you to do it. If the price gets to low, I'm going to pull my item and wait for price to go back up, and only you are screwed with the low price. If you don't want a price war, just match my price. If you undercut by too much, maybe I'll just pull my item and not compete. But you undercut by 1 gil, and it's on. Don't give me some bull garbage about undercutting by only one gil is good for everyone ... undercutting is only good for the you. Matching the price is good for everyone.

And mind you, I'm not against people undercutting. But don't make it some moral argument saying there is a proper way to do it. There is no way in which undercutting benefits everyone. It only benefits you. So don't get upset if you set off a price war by undercutting.

[AmiableApkallu]

If an item hasn't sold by the next time I check on my retainers (which is once, maybe twice a day, at best), and I've been undercut or matched, then I'm dropping the price by way more than 1 gil. There isn't enough demand to justify the price, and I want these things out of my inventory sooner rather than later.

[Rolks]

If an item hasn't sold by the next time I check on my retainers (which is once, maybe twice a day, at best), and I've been undercut or matched, then I'm dropping the price by way more than 1 gil. There isn't enough demand to justify the price, and I want these things out of my inventory sooner rather than later.

And I'm fine with that too. My main point is that people should not get upset that they set off a price war by undercutting, even if it's by only 1 gil. We all want our item to sell. There is no "proper" way to undercut. It's all supply and demand. If I'm willing to supply it at a lower price to get the sale ahead of you, don't get upset that I dropped it by 1k instead of your measly 1 gil.

[NegativeS]

Supply/demand.

If demand is high enough, people will buy the lower listings for an item until they get to the point where they don't think it's worth the price anymore, and boom, you have the value of the item.

If demand is so low that one person undercutting by 1k is enough to tank the price, then the price should have been 10x lower to begin with.

[Exmo]

I'm with OP. If someone undercuts me by an insultingly small amount, I'm happy to sell my crap for 100 gil both to spite them and clear out my inventory.

[Bad_Luck]

It's your money or your product, do what you want. But please, undercut the market board 1k on the stuff I want to buy kthnxbai

[dspguy]

So I had a conversation today with someone in my hunt party, and he brought up undercutting. When he said that you should undercut by only one gil, I told him that if someone does that to me, I drop my price by 1k. And he didn't like that. He said, that if you do that, the price drops, and all sellers lose money, but if you only undercut by 1 gil, then the price remains high for everyone.

The marketboard doesn't work like the real-world economy.

Normal people walk into a store (or go online) and make a decision to purchase a product for various reasons (emotional and financial). Players in FFXIV likely make the decision to purchase the item before they even see the price. Which means, it doesn't matter what the price history is. And it doesn't matter if the offers listed are 99996, 99997,99998, etc. Most players don't shop around.

So by undercutting by 1000 gil, you drop the market for everyone for absolutely no benefit to anyone. It isn't like if I drop the price of an item listed for 100,000 to 50,000 that there's a server wide message that shows up to everyone: "Attention: The Electrope Barding's price on the Marketboard has been reduced by 50,000! Report to the nearest Marketboard to check it out."

The discount you offer by undercutting is done in a vacuum. No one knows about it unless someone just happens to check the marketboard for that item at the time that they made the decision to buy that item and before the next seller comes in 1 gil lower than you.

A few expansions ago, I started completing all my crafting logs. I'd HQ everything I needed to complete the logs, then fill up all of my retainers with this stuff. On Day 1, I'd list it all and undercut by 1 gil. Let's say I had 100 items to sell. Given that ARR/HW stuff isn't the most popular, I wasn't expecting it to sell immediately. There was very little undercutting competition on this stuff, but there was some. I kept on top of it. I was the lowest seller on all of this. I sold about 40 of these items at highly inflated prices. I'm talking stuff like a Yew Longbow HQ for 50k when it costs about 300 gil to make it. By Day 7, I dropped price by 50% on everything left. No sales for another week on almost all of the remaining items.

I then got curious - and I dropped the price to about 10-20 gil over the vendor sale price. I probably sold about 3 of the remaining 50 items at that price. And I left it there for another week. Then I vendored it all.

My conclusion? No one was buying because no one was looking. It didn't matter how much I undercut (by 1 gil, by 1000 gil by 10% or by 99%). The decision to buy is made before the buyer checks the marketboard. It wouldn't matter if I was selling a level 30 craft that takes seconds to craft for 100x more than the cost of materials or whatever I was selling it for 1 gil more than the cost of materials. All that matters is that you have the lowest price at the very moment demand is present - specifically, when someone checks the marketboard to buy it.

Edit: Are they special cases to this? Of course - higher cost items, some players might just "check" to see if there's a deal. You know, like a 15M gil mount that someone listed for 1.5M by accident. But generally speaking, for the vast majority of what's on the marketboard, I'd say the above applies. Undercutting by more than 1 gil is fairly pointless and benefits no one.

[Archeron]

Buy and sell at whatever prices you want. It doesn't matter. The marketboard is PvP, and you are free to do whatever it takes to sell items. If it costs you money, then so be it you do so at your own risk, and other people can snipe it if they think they can do better.

I sell at whatever the going rate is. I do not care about the servers inflated prices. If a server has nothing but inflated items, people will not purchase items on that world. This is the case for most worlds on Dynamis. Are you going to spend 20k+ more gil per item you need out of laziness? Some people will. I wager most won't. I don't sell at inflated rates. If it makes people angry, they're free to buy my items off the market and repost them.

[dspguy]

If a server has nothing but inflated items, people will not purchase items on that world.

Likely incorrect. Play the MB "PvP minigame" more. If you look at the bigger picture, you'll find that most players make the decision to buy something before they see the price. Barring something ridiculous like a level 10 weapon selling for 1M gil, most purchases are decided when they approach the marketboard. And whomever has the lowest price at that moment, "wins."

It isn't like lowering your price 50% creates two sales. It just cuts your profits by 50% IF you even sell your item at all. If it is items that sell fast, like say... Claro Walnut Logs. Undercut the going rate of 500 gil down to 400 gil. The market will follow you down unless your items sells immediately. Cut it further to 200 gil, and maybe you get your sale. But people buy those in stacks of 99. They'd likely buy the lowest price... and the second lowest. And the third lowest, etc. Meaning, you could have NOT undercut by 100+ gil and still sold your item in that case. And if you saturate the market while undercutting by 50%, you might sell your stuff, but the next time you go to list, chances are... the prices will still be BELOW that 50% discount you introduced.

Or - if it is an item that sells 2-3 per day or 2-3 per week... you could undercut, but if someone doesn't check the marketboard to buy it before the next undercutter undercuts you by 1 gil, then all you did was drop the market and produce no sales in the meantime. And if you do eventually sell afterwards, you likely just cost yourself profit by doing so. Unless someone is dropping the price of a 7-8 digit item by a 0, undercutting does not produce sales the way people think it does. However, try explaining that to the entire community.

[Archeron]

Likely incorrect. Play the MB "PvP minigame" more. If you look at the bigger picture, you'll find that most players make the decision to buy something before they see the price. Barring something ridiculous like a level 10 weapon selling for 1M gil, most purchases are decided when they approach the marketboard. And whomever has the lowest price at that moment, "wins."

It isn't like lowering your price 50% creates two sales. It just cuts your profits by 50% IF you even sell your item at all. If it is items that sell fast, like say... Claro Walnut Logs. Undercut the going rate of 500 gil down to 400 gil. The market will follow you down unless your items sells immediately. Cut it further to 200 gil, and maybe you get your sale. But people buy those in stacks of 99. They'd likely buy the lowest price... and the second lowest. And the third lowest, etc. Meaning, you could have NOT undercut by 100+ gil and still sold your item in that case. And if you saturate the market while undercutting by 50%, you might sell your stuff, but the next time you go to list, chances are... the prices will still be BELOW that 50% discount you introduced.

Or - if it is an item that sells 2-3 per day or 2-3 per week... you could undercut, but if someone doesn't check the marketboard to buy it before the next undercutter undercuts you by 1 gil, then all you did was drop the market and produce no sales in the meantime. And if you do eventually sell afterwards, you likely just cost yourself profit by doing so. Unless someone is dropping the price of a 7-8 digit item by a 0, undercutting does not produce sales the way people think it does. However, try explaining that to the entire community.

Citations needed.