The Economics of Plot Prizes
The release of the Altador Cup II prizes is imminent, (or has already occurred since this article was written). Now after all your hard work scoring goals, slinging slushies, and making noise, what prizes should you choose to get the most out of your plot points? The answer requires an understanding of two basic economics principles: supply and demand.
Supply refers to the availability of a product. The more of an item that is available, the lower the price of that item will be. Basically, a common item will be cheap while a rare item will be expensive. Simple, right? But now I’m going to complicate everything by dividing items into two categories: continuous and limited.
Items with a continuous supply are always being introduced into the economy. As more and more of these items accumulate, their price will steadily drop. These items have to be removed from the economy to stabilize the price, usually through quests or being consumed. Items with a continuous supply include anything bought in shops or received from the dailies.
Items with a limited supply are more interesting. There are only a specific number of these items available and no more will ever be introduced. The price of these items will continue to grow, though how fast depends on demand (see below). Items with a limited supply include retired items and most prizes from the Advent Calendar, Aaa’s challenges, and the numerous plots. Most Altador Cup II prizes will fall into this category of course.
Demand refers to how greatly an item is wanted. If a lot of people want an item, sellers will be able to charge more for it. If few people want an item, the seller has to lower the price to move it. In other words, greater demand increases prices and less demand drops prices.
Many things can affect demand, but basically the high demand items on Neopets are those that can be put to some use. Armour and weapons can be used in the Battledome and the new customise feature means wearables are in high demand.
It’s worth pointing out a specific type of high demand item: the consumable item. These items, once used, disappear forever. When a consumable item is used, the supply of that item is reduced. Now imagine if that item was already in limited supply. As the limited supply rapidly shrinks, the price of the consumable item will rise just as fast. Consumable items include books, stamps (or other collectibles), paint brushes, and anything else that disappears after being used.
Not every item that is consumable will have a high demand, however. There must be an incentive for the item to be consumed. Books are used for the Book Club and stamps are put in the Stamp Album. The Gourmet Club only counts food with a rarity index between 90 and 100, so only food falling in that range have an incentive to be consumed. Foods with a limited supply never fall within that range. These foods are stashed, collected, sold, and resold, but are seldom consumed. As a result, the supply stays steady and so does the price. If you would like to see this effect yourself, compare the prices of the Chocolate Brucicle and the Year 5 Stamp. Both of these items were given out by the Advent Calendar in 2002 and would have had similar supplies at the time. There is an incentive to use the stamp, though, and its higher price reflects this.
Now that we know about supply and demand, how do we use that information to choose our Altador Cup II prizes? First, we need to determine which items are the consumables, which will probably include books, stamps, and paint brushes. Second, determine which items have the most limited supply. Okay, this is easy, it’s those prizes that require the most points. Note that paint brushes are not in limited supply (you can get them elsewhere), unless TNT released a special Altador Cup paint brush. (Wouldn’t that be cool? Hey TNT!) So the prizes we should consider getting are those consumables with the most limited supply.
Don’t completely disregard all of the non-consumable items, though, specifically those prizes that require the most points to redeem. They will be the most limited of all since fewer people have enough points for them and many that do never put them on the market. These prizes are usually Battledome items and may sell for millions of neopoints. Items like the Ring of the Lost and the Royal Wedding Ring from the Lost Desert Plot, and the Yooyuball Player Sling and the Yooyuball Keepers Chest Guard from the first Altador Cup are among the most valuable plot prizes out there. But beware; this doesn’t always hold true. The two highest prizes from the Haunted Woods Plot, Thumberts Cane and the Rusty Lamppost, turned out to be far too common and not useful enough to command a high price. Before springing for the “best” prize, do some research first and see how many are appearing on the market and at what price. Then compare with the prices of lesser, consumable prizes. You may be surprised at which are the most valuable, especially after a few weeks.
A quick lesson on how prices behave before we try to sell our prizes. When a new item appears on the market, the lucky few that get it first put a very high price on it. The next people try to sell it for a little less, and the next for a little less than that. The item’s price drops very fast in the first few days after it becomes available, then it will gradually become steady at the price where the supply can satisfy the demand. Items with a continuous supply will usually fluctuate around this point. The prices of items with a limited supply will start to increase however. This increase will most likely be gradual with permanent items, and faster with consumable items.
The most important lesson in selling your prizes is to be patient. Don’t price your item to be the cheapest on the shop wizard. Instead, price it higher and let the price come to you. If the low price for a limited book is 20,000 NP, price yours for 40,000 NP and wait a couple weeks. Or price it for 100,000 NP and wait a couple months. The longer you wait to sell your consumable item, the smaller the supply will be, letting you demand a higher price. If you had sat on your Anubis Toxicology Reports (Abridged) from the Lost Desert plot until now, you could sell it for around a million neopoints! If you want to make a fortune from your consumable Advent Calendar prizes, you may have to wait years!
Now that neat plushie or cool new wearable might seem tempting, but if you get the limited consumables and sell them at the right time, you may make enough neopoints to purchase several other prizes through the shop wizard. That’s a lesson I learned the hard way. When the Journey to the Lost Isle prizes came out, I had redeemed points for the Daring Adventurer Hat right away. Afterwards, I discovered that if I had redeemed for one of the books, I could have sold it for enough neopoints to get the hat and the Spectacles of Perception, and still have points left over.
I mentioned waiting before, but timing is also important. Demand for certain items can be higher at certain times of the year than at others. New items are always in demand for a few weeks after they are released. Sell your Advent Calendar prizes during the next Advent Calendar. Keep your Halloween Bags and sell them on Halloween the following year. Have some mushy heart-themed items? Sell them around Valentine’s Day. So when will be the best time to sell your Altador Cup II prizes and souvenirs? During Altador Cup III, of course! Interest in everything Altador Cup will be the highest then and that will drive the demand for the items. If too many people have the same idea, however, the whole scheme backfires. A lot of people trying to sell the same item on the same day will result in the supply exceeding the demand, and the price will plummet.
Supply and demand can be affected by many different factors, some of which may not be readily apparent. Lupes and Scorchios are popular pets, so Lupe- and Scorchio-specific weapons and armour are more expensive than say Lenny-specific weapons and armours. One plot featured a crystal ball that looked similar to the Crystal Ball Table and caused its price to go up. (I bought one!) Some items may be in demand just because they look more impressive, like the Gigantic Decorated Christmas Tree. Even this article may have an effect if enough people read it and follow its advice, resulting in an excess of Altador Cup II stamps and books and a shortage of other items.
Although this article gives a good idea of what to expect, not every item will behave as described. This is why it’s important to use the shop wizard and the trading post to research the prices. Checking the price over a few days or even weeks will tell you whether the price is climbing or dropping. If the price is dropping, the supply is greater than the demand. If the price is increasing, the demand is greater than the supply.
I hope you found this article informative and that it helps you get the most out of your Altador Cup II prizes.