Guild Wars 2

There are two kind of people when it comes to buying and selling on the trading post. He who spends and he who waits. This post is about he who waits.

I want to talk about the anonymous bidding wars the occur over items on the trading post, which happen nearly exclusively when buying. We’ve all done it. We want an item but aren’t willing to pay 2.50g when we can wait an short unknown duration to get it for 2g. What we do is match the highest buying price and add 1 copper. This leads to this kind of history in the Current Buyers table:

1 Ordered 1g 20s 34c
1 Ordered 1g 20s 33c
1 Ordered 1g 20s 32c
1 Ordered 1g 20s 31c
1 Ordered 1g 20s 30c

The idea behind this is not about the money but the person who keeps checking more frequently, and therefore wants the item more, is the most likely person to be sold that item when one comes available. This is fair when it comes to buying but is completely different when selling. When selling, you must pay a listing fee which makes re-listing your items not financially viable.

This led me to think about the algorithms used when determining who’s items are sold when a buyer, willing to pay the higher price, becomes available.

The trading post uses a FCFS (first-come first-served) algorithm when it comes to this. It seems very fair and is remarkably easy to program. It is, however, notoriously inefficient. Suppose you want to sell 100 of item x and you see in the Current Sellers table:

100 Available 1g 00s 12c
100 Available 1g 00s 13c
100 Available 1g 00s 14c

You are inclined to sell your 100 items at 1g 00s 11c, as you are going to sell your items sooner than listing them at 1g 00s 12c. This is because the FCFS algorithm will sell the previous 100 items before yours.

This starts a downward spiral when the cost of them item decreases over time if the supply is greater than the demand. There is no problem with this, as prices should change based on said supply and demand. The problem is the previous sellers will never sell their items and will lose their 5% listing fee. There is starvation.

I would like to propose a couple of other trading post universes and would like to know if you would prefer any of them to the current FCFS method.

1 – Stack rather than Queue

In this universe, we use a LCFS (last-come first-served, aka FIFO) algorithm. This is where the most recent post for buying or selling and item is the post that receives it first. This sounds incredibly unfair but makes remarkable sense. Rather than the nasty Current Buyers table that we have now, we can have a much nicer table:

3 Ordered 1g 50s 00c
2 Ordered 1g 25s 00c
6 Ordered 1g 00s 00c

This is because the price differences are actual genuine different offers and not just a fixing of the table to try and sell your item faster for a negligible setback of 1 copper. If I wanted to buy this item, putting in an offer of 1g 50s 01c would make no sense, as putting in an offer of 1g 50s 00c would achieve the same thing.

“Won’t the price never go up then?” you may ask. The price will go up if nobody will sell the item at that price because it is worth more. The buyer will be forced to offer more or never get the item.

When selling, this algorithm is grossly unfair and does not combat starvation.

2 – Round Robin

The relevance of round robin is apparent when looking at items which are selling for their minimum price. The idea is to use the same method as FCFS but to only sell up to a certain quantity per seller at a time.

Suppose you have an item with an minimum price of 20c, as selling it to a vendor would net more money than selling it for 19c. For this item, we are likely to see an empty Current Buyers table and a Current Sellers table:

90,000 Available 20c
4,000 Available 21c
3,000 Available 22c

Someone selling this item must post it at 20c and wait 6 months to see their listing fee again or sell it to a vendor. This reduces the versatility of the trading post.

Round Robin solves this. Suppose the 90,000 items are sold by 9 different sellers numbered 1-9, each selling 10,000 of the item. If an order for 9 of the item comes in then 1 will be sold from each of the sellers rather than 9 from the most recent seller. They are sold in the order than the sellers posted, so if an order for 5 items came in then sellers 1-5 will have their item sold and seller 6 would be next in line to sell their item.

3 – A combination

An actual better way of implementing the trading post can be seen by merging these two methods together. By using LCFS and Round Robin when selling items we can attempt to eliminate the unfair practice of undercutting other sellers to the extent that their items don’t sell and they lose their listing fee.

Suppose we have a Current Sellers table of:

1000 Available 1g 50s 00c

where there is only 1 person selling this item. A new seller for 100 of the item would be given the incentive of using a LCFS algorithm to post their item at the price of 1g 50s 00c rather than 1g 49s 99c, as their item will be sold before the previous seller. Posting it at either price achieves the same thing, so will post it for the higher price. However, the use of round robin would help to reduce starvation by selling items from both sellers when a new buyer is found.

I dont see the point of combating undercutting by 1c when listing as it brings the prices closer to equilibrium.

If you are listing something you not only have to consider what people are willing to pay for it, you also have to consider for what people are willing to sell it.

The mistake you make here is believing that people will change their behavior even if this were implemented. Many players will continue to do exactly what they have been doing, even if it makes no sense. I am willing to bet that you could try explaining it endlessly, but they won’t get it.

I don’t see the problem with people who undercut by 1 copper. That’s pretty much Wal-Mart’s core business strategy, and it works. They’re even willing to undercut if it means a loss in some cases. In the end, it’s a strategy that benefits the consumer by deflating prices.

I realize it makes TP speculation more difficult, but frankly I don’t have a problem with making life more difficult for professional auctioneers. Maybe they’ll actually play the game for a change instead of sitting around playing Gordon Gekko? Dare to dream! -Sid

This post isn’t about the 1 copper undercut. It’s about investigating alternative algorithms that can help reduce the number of people left out of pocket in listing fees due to the changing prices of items.

The 1 copper undercut is key to the game’s economy in changing prices based on supply and demand.

Sidenti.6035:

I don’t see the problem with people who undercut by 1 copper. That’s pretty much Wal-Mart’s core business strategy, and it works. They’re even willing to undercut if it means a loss in some cases. In the end, it’s a strategy that benefits the consumer by deflating prices.

I realize it makes TP speculation more difficult, but frankly I don’t have a problem with making life more difficult for professional auctioneers. Maybe they’ll actually play the game for a change instead of sitting around playing Gordon Gekko? Dare to dream! -Sid

Sweet late 80s movie reference. Holy crap I feel old.

Wing.8326:

This post isn’t about the 1 copper undercut. It’s about investigating alternative algorithms that can help reduce the number of people left out of pocket in listing fees due to the changing prices of items.

The 1 copper undercut is key to the game’s economy in changing prices based on supply and demand.

But your algorithms dont change supply and demand, nor do they reduce listings on the tp. They just juggle sales around from one seller to the other.

I also dont see a problem with plenty of listings on the trading post for any given item, even at prices way higher than the current lowest one because they act as buffer for price spikes.

Wing.8326:

This post isn’t about the 1 copper undercut. It’s about investigating alternative algorithms that can help reduce the number of people left out of pocket in listing fees due to the changing prices of items.

The 1 copper undercut is key to the game’s economy in changing prices based on supply and demand.

I’m not interested in reducing the sellers’ exposure to bad listing decisions. It’s the sellers’ responsibility to know their markets. It’s not ANet’s place to protect players from making poor decisions.

Know your markets, know your pricing, know your consumers. -Sid

Wanze.8410:

But your algorithms dont change supply and demand, nor do they reduce listings on the tp. They just juggle sales around from one seller to the other.

That’s the beauty of it. The use of some different algorithms doesn’t change the number of sales but it leaves fewer old posts, with people losing their listing fees, and more newer posts at the updated price after a change in the item’s value.

Wing.8326:

Wanze.8410:

But your algorithms dont change supply and demand, nor do they reduce listings on the tp. They just juggle sales around from one seller to the other.

That’s the beauty of it. The use of some different algorithms doesn’t change the number of sales but it leaves fewer old posts, with people losing their listing fees, and more newer posts at the updated price after a change in the item’s value.

MAybe I didnt read your op right but how does your algorithm get rid of listings over lowest listing?

Sidenti.6035:

I’m not interested in reducing the sellers’ exposure to bad listing decisions. It’s the sellers’ responsibility to know their markets. It’s not ANet’s place to protect players from making poor decisions.

You’re right, ANet doesn’t have to protect any sellers from losing their listing fees. It’s probably not in their interests to reduce the gold sink from lost listing fees.

I’m not interesting in that kind of thing though. I just want people to check my logic and help me realise things I wouldn’t be able to by myself.

Wing.8326:

Sidenti.6035:

I’m not interested in reducing the sellers’ exposure to bad listing decisions. It’s the sellers’ responsibility to know their markets. It’s not ANet’s place to protect players from making poor decisions.

You’re right, ANet doesn’t have to protect any sellers from losing their listing fees. It’s probably not in their interests to reduce the gold sink from lost listing fees.

I’m not interesting in that kind of thing though. I just want people to check my logic and help me realise things I wouldn’t be able to by myself.

Technically, they already lost their listing fee, when they listed it. It doesnt matter, how fast or slow it sells.

Wanze.8410:

Technically, they already lost their listing fee, when they listed it. It doesnt matter, how fast or slow it sells.

How fast an item sells does matter as the active buying and selling prices change over time. An item may be worth 1.5g, so you list it at 1.5g. If it doesn’t sell fast enough and the value of the item changes to 1g over a week then you will never sell that item. You would lose your listing fee and have to put up another listing fee if you wanted to sell it again for 1g.

Wing.8326:

Wanze.8410:

Technically, they already lost their listing fee, when they listed it. It doesnt matter, how fast or slow it sells.

How fast an item sells does matter as the active buying and selling prices change over time. An item may be worth 1.5g, so you list it at 1.5g. If it doesn’t sell fast enough and the value of the item changes to 1g over a week then you will never sell that item. You would lose your listing fee and have to put up another listing fee if you wanted to sell it again for 1g.

…and whose fault is that for not knowing their market?

See, this is what I was talking about. Your suggestions all seem to be angled toward improving the lot of a seller beyond reason. ANet’s not in the business of making sure players all maximize their returns on the trading post. That’s on the sellers themselves, and what you mention is a legitimate market risk. Prices change. The smart sellers stay on top of those changes – and the smartest ones, ahead of them. -Sid

Wing.8326:

Wanze.8410:

Technically, they already lost their listing fee, when they listed it. It doesnt matter, how fast or slow it sells.

How fast an item sells does matter as the active buying and selling prices change over time. An item may be worth 1.5g, so you list it at 1.5g. If it doesn’t sell fast enough and the value of the item changes to 1g over a week then you will never sell that item. You would lose your listing fee and have to put up another listing fee if you wanted to sell it again for 1g.

In that case, it never was a 1.5g value in the first place when you listed it and just because the value goes down to 1g temporarily doesnt mean it wont go back up in future.

There only needs to exist at least one case where the implementation of this protocol would improve the situation for users for the whole change to be considered an improvement.

Nearly all items fluctuate in price. What I am talking about is reasonably permanent price changes. For example, I think there is a buy offer on spark for 10g. When the game first came out, that might have been a reasonable price for spark and it may have sold at that price. It is reasonable to say that the price of spark has been permanently increased.

This is just an example. The history of spark is irrelevant. It’s just reasonable to say that someone who is trying to sell and item whose price has been drastically decreased for a long duration will likely never sell that item. They would need to repay the listing fee to be able to sell it.

Wing.8326:

There only needs to exist at least one case where the implementation of this protocol would improve the situation for users for the whole change to be considered an improvement.

Nearly all items fluctuate in price. What I am talking about is reasonably permanent price changes. For example, I think there is a buy offer on spark for 10g. When the game first came out, that might have been a reasonable price for spark and it may have sold at that price. It is reasonable to say that the price of spark has been permanently increased.

This is just an example. The history of spark is irrelevant. It’s just reasonable to say that someone who is trying to sell and item whose price has been drastically decreased for a long duration will likely never sell that item. They would need to repay the listing fee to be able to sell it.

And thats exactly how it should be or people will put up for insane prices to hope to sell it and if they dont they will be auto merged down to what a person is willing to buy with your system.

So someone actualy knowing what people are willing to buy for will get penalized just becouse they put up their item later so the one who put their item up a6 months ago as world first will get its sold?

My suggestion is not to allow people to change how much they’re selling an item for without re-listing it and repaying the listing fee. It is just to change the algorithm so fewer people lose their listing fees from items that will never sell.

Using a LCFS/LIFO algorithm is grossly unfair as people are penalised for putting up their offers earlier than someone else. It’s just that, even though the current system uses FCFS it is practically a LCFS system because of the 1 copper undercut. The suggested system would embrace using a LCFS system to enable an incentive to use the vastly more efficient Round Robin system.

Wing.8326:

My suggestion is not to allow people to change how much they’re selling an item for without re-listing it and repaying the listing fee. It is just to change the algorithm so fewer people lose their listing fees from items that will never sell.

Using a LCFS/LIFO algorithm is grossly unfair as people are penalised for putting up their offers earlier than someone else. It’s just that, even though the current system uses FCFS it is practically a LCFS system because of the 1 copper undercut. The suggested system would embrace using a LCFS system to enable an incentive to use the vastly more efficient Round Robin system.

If I’ve said it once, I’ve said it a thousand times – what you are looking for here is a means of protecting bad sellers from their own bad sales techniques.

If the seller is listing too early, this is the seller’s problem.

If the seller is getting outpriced, this is the seller’s problem.

If the seller loses out on listing fees because they have to relist? Guess what.

I appreciate that you would like to shield people from their own bad decisions. But it doesn’t make for a stronger, smarter, better person in the end. It just makes for a weaker person who depends on a system being geared toward success no matter which choices are made.

There are several HUGE flaws in your logic.

Wing.8326:

By using LCFS and Round Robin when selling items we can attempt to eliminate the unfair practice of undercutting other sellers to the extent that their items don’t sell and they lose their listing fee.

How many people “lose their listing fee” does not depend on how often people will be undercut, but on how many people are willing to buy the items for the listed price! The current system encourages undercutting, and more or less encourages prices to slowly sink and then stabilize around a level, where people listing items and people buying these listed items are in a good balance, thus more items will be sold, and less people will “lose their listing fee”.
Your system encourages sell prices to stay high, thus disencouraging potential buyers to buy these listed items, because they stay at a too expensive level for way too long. More people will pay their listings fees in vain.

Wing.8326:

Suppose we have a Current Sellers table of:

1000 Available 1g 50s 00c

where there is only 1 person selling this item. A new seller for 100 of the item would be given the incentive of using a LCFS algorithm to post their item at the price of 1g 50s 00c rather than 1g 49s 99c, as their item will be sold before the previous seller. Posting it at either price achieves the same thing, so will post it for the higher price. However, the use of round robin would help to reduce starvation by selling items from both sellers when a new buyer is found.

This actually contradicts itself.
The round robing thing means that the 100 items of the new guy will take longer to sell, because the other guys 1000 items are being mixed in between his. One of the other guys items will be sold now and then instead of the new guys items, so he has to wait longer until his stock is sold. He will instead list his items at 1g 49s 99c to sell them faster. This system encourages undercutting as well, because “posting it at either price” does not “achieve the same thing”.

Wing.8326:

It’s just reasonable to say that someone who is trying to sell and item whose price has been drastically decreased for a long duration will likely never sell that item. They would need to repay the listing fee to be able to sell it.

But undercutting is not the reason that the item doesn’t sell, the reason is that there’s not enough demand from people willing to buy the items at that price, so prices will naturally sink.
LCFS will just keep prices at a higher level, so you are even less likely to sell your stuff, because, additionally to the wall of items listed after yours, you now have a price wall blocking your item from being sold: because of the higher prices, buyers will have to pay much more gold to remove the wall of items listed after yours.

Your round robin system though encourages people to undercut to sell faster, as stated above. It won’t have much effect on the current system and it definitely will not counter undercutting.

AzureSky.3175:

But undercutting is not the reason that the item doesn’t sell, the reason is that there’s not enough demand from people willing to buy the items at that price, so prices will naturally sink.

This.

It is amazing how many people do not understand that:

- listing price =/= actual supply/demand
if your item doesn’t sell, the demand was not high enough to cover the entire supply

- there is hourly, daily, weekly, monthly and even yearly changes in the supply and demand function
daily – check what goods are worth in the morning, midday, evening and during the night. you’ll notice strong fluctuations
weekly – every compared weekend prices to mid week prices?
monthly – those skins that were out last month might have changed, or it might take them a couple of weeks more
yearly – helloooo Halloween, Wintersday, etc events.

Undercutting by 1c is absolutely fine. You have no guarantee as seller to have your item sold. You already are in absolute control of said item, you get to:

- own the item (ingame own aka right of use, arenanet are owners of all content actually)
- decide if or if not to sell
- have complete control over your pricing strategy
- have access to multiple ressources as far as pricing history of said item and to a certain extent future scarcity

There is nothing more a seller could or should want.