Saturday Superstar: farming it for free

| Saturday, December 26, 2009
"I farmed it, so it's free"
This is a common mistake. The problem is that it gives no value to the player's time and through that fails to recognize the cost of farming. But maybe it is for the greater good.

Those who make this mistake are failing to fully think through the value and cost of their materials. However this might actually be productive due to diminishing returns and the tendency of markets to trickle benefits around.

All players have a certain 'needed' amount of gold. Some only need very little and can get by with a few dailies a week. Any more gold won't do much for them. They have hit their 'gold cap' and any more would have huge diminishing returns on their additional happiness/fun. To put it in number terms, a player who only goes through 100g a week won't benefit much from getting 200g a week. What would they spend it on? If they are making so little gold it is unlikely that they are active in the player economy. More gold would be spent on NPC purchases, perhaps a few mounts. More gold for them would just vanish, converted into mounts which add little value.

Before I go to the other side of this, I want to make clear that I have nothing against mounts. I'm not going to call people moron socials for buying dozens of mounts and pets. However it is still worth considering that for a player without much gold, mounts have very little value compared to the relative cost.

Let's be more specific about the free herbs. A stack sells for 20g. They sold them for 15g, wanting a quick sale. They effectively lost 5g per stack. But this means that the buyer gained 5g per stack. It is here that we see the benefit.

The buyer is probably a crafter and will make something with the herbs: glyphs, potions, flasks, cards, etc. If he has cheaper herbs he can do a few things with what is for him literally free gold. He can charge less for his product and make the same profit. He can also charge less because he took on less risk. Or he can charge his usual price and make a greater profit.

If he charges less, a consumer gets a cheaper product. The consumer is active in the economy and having gotten something for less than he was prepared to spend, may buy additional goods as well. In other words, the herbalist has helped the consumer to get more for his gold and stimulated additional buying and therefore crafting. The consumer has gained a benefit from the 'free gold' more than the herbalist would have, since the consumer is buying flasks and nobles decks that will help him play better with others; bettering their experiences as well. The herbalist, by cheating himself, has enriched many others.

If the crafter charges his usual amount and makes greater profit, he has more free to buy additional materials and do more crafting. This means other gatherers have more sales. The crafter has more sales as well. Consumers benefit from a greater supply which allows more people to get the benefits of crafted goods.

The crafter and buyer both have higher gold caps. The lower diminishing returns on them having gold benefits the overall economy. They can work with greater amounts of gold, moving it back through the player economy, creating ripples of profit.

See how the herbalist who farms for free works for the benefit of all? But it gets better! If by chance the market price of herbs drops, he isn't going to switch to more profitable activities. Instead he will farm even more to make up the loss. This means that crafters get a double benefit of cheaper mats and greater supplies. Even better is if the herbalist is putting a very small amount of thought into the market, just enough to see that prices are going down, but not enough to switch to more profitable activities. In this situation he will undercut even more, attempting to outrun the drop in prices, but instead furthering their decline.

Is this bad for the other herbalists? Perhaps. But there are two types of herbalists. The first type is like our free farmer and isn't hurt all that much; they'll just farm more to compensate. The second type are more aware. When prices fall they will shift to other markets or possibly withdrawal from the herb market. While this will cut their income and for them it actually matters, they are capable of taking steps to mitigate the damage.

Next time you see someone say they farmed something for free, just smile and move along. If you're feeling nice, say thank you. Don't worry, they won't figure out what you meant.


LarĂ­sa said...

The big question to me is if you enjoy the activity of farming or not. If it's a "necessary evil" that you do just to get gold - then you really should reconsider the "for free" idea. But on the other hand - if it's something you do while waiting for a random daily or whatever and you actually enjoy just flying around in the scenery, relaxing by picking herbs - well then the how-much-gold-do-I-make-from-this-question seems rather irrelevant. It annoys me a bit when gold-making sites keep claiming that gathering is a silly activity. Making quick gold isn't the goal for everyone in the game.

Klepsacovic said...

@Larisa: It's about maximizing fun. Is farming more or less fun than whatever else you'd be doing? If it's less fun, then you'll want to minimize farming, maximizing the profit from it; whereas if farming is more fun, then getting less gold per hour isn't as much of a loss proportionally.

Gold-making sites are fairly stupid in my opinion. Gathering, dailies, crafting; they are all essential and someone must do them. Imagine if we all followed the flipping and crafting guides. We'd have no gold supply and no mats.

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