Friday, January 21, 2011

Shop Smart: Return of Investment

In this week's Shop Smart we are going to be looking at your Return of Investment. RoI is something I don’t think many players think about so I wanted to touch on it and hopefully to bring it to the forefront of your mind.  Let me start with something simple that everyone uses and what really got me to thinking about this, Bags. That’s right Bags, we all use them and we often make a tidy sum selling them. But when we are forced to buy them, or make them for ourselves, when do we reach our Return of Investment. 

For example when Brimbane hit level 30 I treated myself by purchasing 2 Embersilk Bags for 300 gold each. I was happy to find them listed so low on the Auction House.  These 22 slotters replaced my 14 slot Journeyman's Backpacks for a net gain of 16 new slots.  If you do the math you will see that it comes to 37.5 gold per bag slot. Easy to make up with extra stacks of wool, herbs, or any other item that sells well, that you'll loot during your runs. If you look at the per slot cost it becomes easy to rationalize that added slots equal more loot and more loot equals more gold. If you follow this line of thinking, as I do then you are mostly correct. On the other hand if I had 20 slot Frostweave Bags and replace with 22 slot bags then I would have been looking at 150 gold per bag slot. The cost here is much harder to justify. But at some point even 4 extra slots will pay for themselves over time. The amount of time it takes is know as your Return of Investment.

This is a simple example of RoI. When you start looking at things like armor or enchants the picture is not so clear.  I am unsure if I could explain it to the degree needed to fully understand outside of an economics class so I will leave it for your own personal study. But by using my example, I hope you will start to think about how much you really spend on those epic purchases. Because, if at the time of replacement, your RoI is not accomplished then it should be counted as lost gold with no way to recover.

"Making gold is not just about selling; it’s also about spending wisely." -Brimbane

No comments:

Post a Comment