• Sparrow

    Shhhh... the Secondary Market!

    Let's talk about the Secondary Market.*

    WAIT, why on earth have I chosen a picture of a dog? Hmmm. I guess that question will be answered at some point. Let's carry on.

    So, let's talk about breeding and selling. There are many types of breeders. There are the vast majority who breed for pleasure, sell their dragons here and there and rarely go to auctions. Then there are those who are 'big breeders' who breed to make a profit, regularly go to auctions and have a big market presence. And there is a whole spectrum within that, of those that dabble with markets, those that infrequently try out auctions, those that never sell an egg but see breeding as a hobby that costs less than skiing or golf in the real world.

    Few things in life are certain, apart from taxes, more MCU films or death. But one thing is certain; if an egg or dragon is sitting in your inventory, it's not making any money for you. Does that matter? Well, it's a fabulous hobby, but wouldn't it be nice if you got some return on your investment?

    I've been in Dragons since the beginning. I wouldn't count myself as a 'big' breeder but I have a fair few breeding at the moment. This is my hobby, one that takes me away from my RL job and lets me solve puzzles, market my goods and meet some amazing people. Sure, there's a bit of drama here and there, but that's SL for you. Most importantly, I have fun and I love the dragons I have created or have seen others create.

    And I haven't uploaded Lindens for months.

    I use a range of strategies to run my little dragon breeding enterprise. I see my breeding as a hobby business - I factor in costs of food, tier, rent at markets and advertising. From that model I tend to make a little more than it costs me to breed. Those of you that know me will know that I am an auctioneer as well as a breeder. But the 10% I get in tips represents about 10% of my income in dragons. I am a breeder first and an auctioneer second. Let me tell you how I do it.

    All breedables operate as a 'trickle-down' economy. Something new comes out, it sells for big money. Then the person who buys it sells some more of that commodity at a lower rate and the rate slowly reduces over time. That's normal market economics, a powerful demonstration of supply and demand. When there's only ONE of a thing, it is in OOAK - one of a kind. And that's worth a lot. When everyone has one, then it's not worth as much. Buying at the right time to maximise returns is important. I don't tend to wait for the price to hit rock-bottom as everyone has it by then. Getting in early and buying from a reputable breeder is key.

    When I came back into Dragons a few months back, I did have a small pot of money that I'd made from other breedables. I spent the first few days walking around markets, going to auctions and working out what was selling and what was not. I also had hundreds of eggs from before. I spent a few days sorting the eggs, then hatching some 'clean' dragons, like perfect Tolraes or Zemraidus to act as a palette on which to daub my new dragon designs. I certainly hatched my favourite Datentuds with Ukeinth eyes - they are great at taking any trait. I then started buying up some of the new markings and skins. At that point, Flarenacht and Molten Soul were still going for decent prices, so I concentrated on those. I built up pods, sometimes double pods of 8 to speed up the breeding process, then slowly built up my stock. So there is some initial investment - and the more you invest (wisely!) the more you make back over time.

    As I up-traited my dragons, I sold off the ones I no longer needed. I do that very quickly, to ensure that I don't waste precious market time. Sometimes, I have managed to sell a dragon for what I bought it for 10 days previously (and once or twice for a little more!).

    I also rented market stalls and started selling some of my old stock - it seems there is always a market for clean dragons.

    With regards to that initial investment - sometimes it is daunting forking out 30K for a marking or trait - especially as you will see that price drop over the next few days (like buying a new car - it loses 20% of a its value as you drive it off the forecourt). But, for example, I paid 30k for a marking, then used it to make some nice designer dragons and have easily recouped my costs, 5 or 6 times over. And when you drop a nice designer dragon onto a market stall, even as the rarity of that marking is fading, you have a decent chance of getting a sale, even months after your initial investment. People buy the marking for the marking at the start. Then they pay for the designs later.

    So there's our first part of the process - the markets.

    There are a number of Official Mystical Creatures Markets. You can get a listing of them off this website. These markets abide by the Ameretto rules on pricing and operating, so you know your precious eggs won't be next to a stall pumping them out for next to nothing. The dragons that sell well on these stalls are often the really striking designs that look fairly unique and of course the dragons that everyone needs for their breeding projects. Not many breeders go to auctions (see below) but most breeders will visit a market from time to time. All markets do a good job of advertising what is going on in their markets and do various things to drive traffic - which brings me to the next part of the marketing process. Advertising.

    You could spend all day sending out notices in groups (and generally annoying people if you spam it too much!), but the most effective way I have found of marketing my dragons directly to the buyers is the marketing system that I use called Petrades. There are other products available, but I use that one; it's a kiosk system that you buy into, then pay fees each time you sell your dragons. You can also 'boost' your listings (rather like Google AdWords) and make sure your babies are prominent when people search. If it costs me 80L to sell a 5k dragon, I see that as money well spent.

    And people do search. Sometimes I list a dragon and within a few minutes it is gone. If the price is right, or it is super rare, you will see those hawks that regularly flick through the listings, see what's just been listed and then TP direct to it.

    I can't tell you the number of times I've seen a juicy listing and TP'd there, to see the person who got there before me TPing out, with my intended goal in their dragon robbery sack.

    It does cost. But if you use it well, you can get your dragons seen by the people that are actually searching for exactly what you have. That is very powerful direct advertising, reaching the consumer precisely.  I use it all the time to find specific traits I am looking for in a project. Sometimes there is literally only one of that trait available - and more than likely, that seller will get my business.

    Think of it as an ongoing cost, like food and tier. It's a part of any business strategy and without good advertising, a business will struggle to stand out. I know for a fact that the money I've spent on advertising is dwarfed by the returns in the long run.

    And here's a sneaky tip: if you've got a lot of Sterling Steel dragons, you don't have to pay to list every single one. Get a 'headline stealer' dragon out, then put eggs around it. Once they've committed to TPing to your wares, they are in buying mode. Make the system work for you - you need to get every bang you can for your buck.

    So what about Auctions?

    Auctions can be scary. How do I price my dragon? What is it worth? Do I want to actually sell it? What if I price it too low and am ambushed by a mob of angry villagers with pitchforks, flaming torches and a desire to marry a close relative?

    Well, best advice is don't price too low - look at the prices in the market, work out a price that is tempting but not ridiculously cheap and start there. Don't open bid a 20K dragon, you'll not get 20K  because of consumer perception. If you start at an open bid (usually 500L) you are sending a clear message to the punters; you don't value your dragon at 20K, so they won't either.

    If you've spent months building an amazing line of designer dragons, value the time, love and effort that has gone into that. Think about those 'luxury' items in the store. They are boxed up all fancy, with gold and ribbons, in a sleek shiny box and the price tag reflects that.

    You've done the boxing up, you've added the ribbons, you've shoved in the love - now give that dragon a price tag to match. Don't just slap a yellow sticker on it and wait for the bargain hunters to arrive.

    If you don't value your dragon, neither will the crowd. And if you get a reputation as a 'market crasher' then people will be wary of buying off you. After all, if you sell someone something for 40k then offer it out at 20k the next day, the person who bought off you has instantly lost 50% of their margins. Believe me, they won't thank you for that....


    Don't be. It's nerve-wracking waiting for your turn to come up, but auctions are fun with some wonderfully zany, friendly people. They're not cliquey at all and you can make some lovely new friends.

    Dragons bite. People don't. Well most don't. And some may give a little nibble, but a little nibble between friends can be fun.

    The almost-final part of your little hobby business is your image. I like to make a striking logo, then dress my stall to make it look attractive. If you just scatter your eggs across a barren platform, as if you've chucked a handful of sand across a crowded beach, people will cam past it.

    And finally.... Don't send out weekly 'leaving dragons' sales or 'all prices slashed' or 'RL has eaten my toes and I need new socks' messages. Think about that all important consumer perception - if you sell fire-damaged stock, your reputation will be commensurate with that perception. People tend to buy off the breeders that value their stock and the market's opinion of them. You wouldn't buy a dog from a disreputable puppy farm, would you? Virtual pets are just as valued as the lovely dog called Barney sitting at my feet as I type this.

    Oh, so that's what the picture was for!


    * Please note that the views presented in this article are the personal opinions of the author and do not represent an endorsement by Amaretto Mystical Creatures of any market, third party product or service.


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