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| | | Author: | Gaston.La.Brick  | | Posted: | Oct 1, 2018 08:47 | | Subject: | 90-percentile as new average price ? | | Viewed: | 202 times | | Topic: | Suggestions | | Status: | Discarded | |
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| I noticed the highest prices of items sold (or of items that are on sale), have
an out of proportion influence on the average prices.
Example: when 9 people sell (or have sold) an item at €0.10 but 1 person has
sold that item for €10.00, the average price would be €1.09
You may say this example is not realistic, but it's not that unrealistic
either. Check out item 6558. The avg used price of last 6 month sales is €0.023,
while the majority of the sales are for less as €0.02
If you look more closesly, you see a few sales at a high price, but not a lot.
(Note: someone even sold a few of these for €1.00 !)
It's my suggestion to change the calculation of avg price to use the 90-percentile
method. So only the 90 percent (lowest prices) are taken into account. That way,
the top 10-percent highest prices are not taken into account when calculating
the avg price.
To avoid weird behaviours, the rule could be in place only when there are 10
items sold/for sale.
Example would become an avg price of €0.10
Another somewhat more complex method would be the use the median. Not the mathematic
average, but the middle price: 50% of the sellers have a lower price, 50% of
the sellers have a higher price.
What do you guys think?
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| | | | | Author: | Teup | | Posted: | Oct 1, 2018 09:05 | | Subject: | Re: 90-percentile as new average price ? | | Viewed: | 77 times | | Topic: | Suggestions | |
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| In Suggestions, Gaston.La.Brick writes:
| | I noticed the highest prices of items sold (or of items that are on sale), have
an out of proportion influence on the average prices.
Example: when 9 people sell (or have sold) an item at €0.10 but 1 person has
sold that item for €10.00, the average price would be €1.09
You may say this example is not realistic, but it's not that unrealistic
either. Check out item 6558. The avg used price of last 6 month sales is €0.023,
while the majority of the sales are for less as €0.02
If you look more closesly, you see a few sales at a high price, but not a lot.
(Note: someone even sold a few of these for €1.00 !)
It's my suggestion to change the calculation of avg price to use the 90-percentile
method. So only the 90 percent (lowest prices) are taken into account. That way,
the top 10-percent highest prices are not taken into account when calculating
the avg price.
To avoid weird behaviours, the rule could be in place only when there are 10
items sold/for sale.
Example would become an avg price of €0.10
Another somewhat more complex method would be the use the median. Not the mathematic
average, but the middle price: 50% of the sellers have a lower price, 50% of
the sellers have a higher price.
What do you guys think?
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This suggestion comes up now and then, I am not in favour, as it makes the priceguide
less transparent but most of all it promotes the race to the bottom even more.
In a different kind of design, with a different role and usage for the priceguide,
I could be in favour. But the way Bricklink is set up now, I think sellers very
strongly evaluated based on their prices not being above average - at least that's
how I used to use Bricklink when I was a buyer. I think in the current design,
we need those quirky up-effects, not because they make for the most ideal and
scientifically sound kind of priceguide, but to balance things in a context where
down-effect already prevails.
What surprises me though is that you suggest it to include only the lowest. Why
not middle 90%? What you propose seems to me like a race to the bottom on top
of a race to the bottom.. That sounds like you prefer the priceguide showing
just low prices over accurate prices. I really don't think prices on Bricklink
are unfair at all considering all the work that goes into running a store.
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| | | | | | | Author: | Gaston.La.Brick | | Posted: | Oct 1, 2018 09:54 | | Subject: | Re: 90-percentile as new average price ? | | Viewed: | 53 times | | Topic: | Suggestions | |
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| | | I really don't think prices on Bricklink
are unfair at all considering all the work that goes into running a store.
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You are jumping to conclusions. I never said prices are unfair. I'm saying
the average calculation, although mathematically correct, is not a good indication
of what a piece is actually sold for most of the time.
Because that is what the average amount implies: the average price to which an
item is sold for most of the time.
For me, I use the average price to set my pricing. But currently it becomes unreliable,
when you have to verify how many items have been sold at a price that's not
realistic (or at least: that has something strange going on -- $1.00 for
a typicall $0.02 item, seems strange to me).
You are not for, because it would make the calculation less transparant. But
it doesn't have to be clear how it was calculated, as long as it's accurate.
It's like Google search engine: you don't need to know the algorithm
behind it, as long as the results are accurate (which they typically are).
Your remark about why not the middle 90p (so 5p-95p range), is valid but I'm
in doubt about that. It still is a seller/buyer market. So a low price actually
does mean a very solid competition that influences the seller/buyer market. This
in contrary to a very high price, which is not relevant for the seller/buyer
market.
The reason I wouldn't include the lowest 5p, I give you that, is to exclude
the sellers who price very low but add a ridiculously high fee per lot.
In the end, to me, it still feels the average price as a purely mathematical
average, is not very useful. You imply it's good for sellers, since the buyer
gets an (unrealistic) idea about the amount he should spend on the item. Unless
it's a smart seller that looks at other stuff than average amounts... (and
I think most of them do).
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| | | | | | | | | Author: | MidwestBrick | | Posted: | Oct 1, 2018 10:33 | | Subject: | Re: 90-percentile as new average price ? | | Viewed: | 60 times | | Topic: | Suggestions | |
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| In Suggestions, Gaston.La.Brick writes:
| | | | I really don't think prices on Bricklink
are unfair at all considering all the work that goes into running a store.
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You are jumping to conclusions. I never said prices are unfair. I'm saying
the average calculation, although mathematically correct, is not a good indication
of what a piece is actually sold for most of the time.
Because that is what the average amount implies: the average price to which an
item is sold for most of the time.
For me, I use the average price to set my pricing. But currently it becomes unreliable,
when you have to verify how many items have been sold at a price that's not
realistic (or at least: that has something strange going on -- $1.00 for
a typicall $0.02 item, seems strange to me).
You are not for, because it would make the calculation less transparant. But
it doesn't have to be clear how it was calculated, as long as it's accurate.
It's like Google search engine: you don't need to know the algorithm
behind it, as long as the results are accurate (which they typically are).
Your remark about why not the middle 90p (so 5p-95p range), is valid but I'm
in doubt about that. It still is a seller/buyer market. So a low price actually
does mean a very solid competition that influences the seller/buyer market. This
in contrary to a very high price, which is not relevant for the seller/buyer
market.
The reason I wouldn't include the lowest 5p, I give you that, is to exclude
the sellers who price very low but add a ridiculously high fee per lot.
In the end, to me, it still feels the average price as a purely mathematical
average, is not very useful. You imply it's good for sellers, since the buyer
gets an (unrealistic) idea about the amount he should spend on the item. Unless
it's a smart seller that looks at other stuff than average amounts... (and
I think most of them do).
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A low price puts in all those sales where people are "selling out".
Overall, to each their own on pricing. I have my own methods which vary from
color to color, type to type and category to category, and use multiple buckets
to put items into rather than one. If I have a piece and want to sell it for
$1 when the market is $0.05 and it sells. That's a great business decision.
Price is only one factor of many when buyers choose your store.
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| | | | | | | | | Author: | yorbrick | | Posted: | Oct 1, 2018 10:45 | | Subject: | Re: 90-percentile as new average price ? | | Viewed: | 63 times | | Topic: | Suggestions | |
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| | | You are jumping to conclusions. I never said prices are unfair. I'm saying
the average calculation, although mathematically correct, is not a good indication
of what a piece is actually sold for most of the time.
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Throwing away data using some other biasing gives an even worse indication of
what it has sold for.
| | Because that is what the average amount implies: the average price to which an
item is sold for most of the time.
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The average value reports the average (mean) value - it is exactly what it says
it is. The average is not the value an item is sold for most of the time. Although
sellers might want to know a more reasonable price to list their items at, the
average is there as a guide, not a definitive value.
| | For me, I use the average price to set my pricing. But currently it becomes unreliable,
when you have to verify how many items have been sold at a price that's not
realistic (or at least: that has something strange going on -- $1.00 for
a typicall $0.02 item, seems strange to me).
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Why is it unreliable? It is reporting the average of all sold prices. If a $0.02
item frequently sells for $1.00 then it should be included as the sales are frequent.
If it is a one off, then it will hardly affect the average price at all if the
item is commonly sold at $0.02.
| | You are not for, because it would make the calculation less transparant. But
it doesn't have to be clear how it was calculated, as long as it's accurate.
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There is no such thing as an accurate average when data has been removed. You
don't want an accurate average price, you want an accurate average based
on a 90-percentile, so only taking the lowest 90% of the data. What happens if
there are low outliers? Why do you want to include those, but not the high end
of the distribution. If you average over the lowest 90% then base prices on that,
then average over the lowest 90% and base prices on that, then average over
the lowest 90% and base prices on that, and iterate so on, then prices will necessarily
tend towards zero, even if the price distribution is Gaussian each month.
| | In the end, to me, it still feels the average price as a purely mathematical
average, is not very useful.
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Any statistic like this has to be mathematical. Your suggestion is also mathematical.
The algorithm you suggest is to take the lowest 90% of prices and take the mean.
That is no less mathematical than take all the prices and average.
Averages are a bit pointless for distributions that are not Gaussian / bell-shaped,
and on BL many have either long tails left or right, or are bi-modal (or worse).
There are other ways of getting averages, such as fitting a Gaussian distribution
to price regions with dense sales, ignoring others. Or fitting the middle 95%,
or 90% or 60%, etc. You can do this, as BL supplies all the data you need to
choose your own algorithms.
A much bigger problem is that the data you are using to fix your sales prices
are worldwide, yet prices vary by region. Some regions include tax, others do
not. For example, why base your price on an average mainly coming from US sales,
when the EU market might be willing to pay more?
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| | | | | | | Author: | Bricks_NW_UK | | Posted: | Oct 1, 2018 11:10 | | Subject: | Re: 90-percentile as new average price ? | | Viewed: | 40 times | | Topic: | Suggestions | |
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| I agree with the point Teup makes on this.
"The race to the bottom" is something that concerns us as well.
Constant "sales" just harm the overall selling prices. Same goes with
store clearance, liquidation sales, closing shops etc.
Other have commented that the selling price is just going down
The same goes with the stores that overprice and then offer silly discounts.
We have already seen the damage caused to set prices where incomplete sets are
included in the average price and then driving down the set prices.
None of this gives any credibility to Bricklink at all.
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| | | | | Author: | Etown | | Posted: | Oct 1, 2018 15:16 | | Subject: | Re: 90-percentile as new average price ? | | Viewed: | 66 times | | Topic: | Suggestions | |
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| In Suggestions, Gaston.La.Brick writes:
| | I noticed the highest prices of items sold (or of items that are on sale), have
an out of proportion influence on the average prices.
Example: when 9 people sell (or have sold) an item at €0.10 but 1 person has
sold that item for €10.00, the average price would be €1.09
You may say this example is not realistic, but it's not that unrealistic
either. Check out item 6558. The avg used price of last 6 month sales is €0.023,
while the majority of the sales are for less as €0.02
If you look more closesly, you see a few sales at a high price, but not a lot.
(Note: someone even sold a few of these for €1.00 !)
It's my suggestion to change the calculation of avg price to use the 90-percentile
method. So only the 90 percent (lowest prices) are taken into account. That way,
the top 10-percent highest prices are not taken into account when calculating
the avg price.
To avoid weird behaviours, the rule could be in place only when there are 10
items sold/for sale.
Example would become an avg price of €0.10
Another somewhat more complex method would be the use the median. Not the mathematic
average, but the middle price: 50% of the sellers have a lower price, 50% of
the sellers have a higher price.
What do you guys think?
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I voted no because I am hesitant to support anything that would expedite the
race to the bottom. It's getting more and more difficult to find sets with
a large enough margin to make it worth while. Besides, adding something that
makes the calculations even less transparent isn't a good move for Bricklink
in my opinion.
Ron
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| | | | | Author: | jx | | Posted: | Aug 12, 2020 20:15 | | Subject: | Re: 90-percentile as new average price ? | | Viewed: | 42 times | | Topic: | Suggestions | |
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| In Suggestions, Gaston.La.Brick writes:
| | I noticed the highest prices of items sold (or of items that are on sale), have
an out of proportion influence on the average prices.
Example: when 9 people sell (or have sold) an item at €0.10 but 1 person has
sold that item for €10.00, the average price would be €1.09
You may say this example is not realistic, but it's not that unrealistic
either. Check out item 6558. The avg used price of last 6 month sales is €0.023,
while the majority of the sales are for less as €0.02
If you look more closesly, you see a few sales at a high price, but not a lot.
(Note: someone even sold a few of these for €1.00 !)
It's my suggestion to change the calculation of avg price to use the 90-percentile
method. So only the 90 percent (lowest prices) are taken into account. That way,
the top 10-percent highest prices are not taken into account when calculating
the avg price.
To avoid weird behaviours, the rule could be in place only when there are 10
items sold/for sale.
Example would become an avg price of €0.10
Another somewhat more complex method would be the use the median. Not the mathematic
average, but the middle price: 50% of the sellers have a lower price, 50% of
the sellers have a higher price.
What do you guys think?
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(Bump) I'm in favor for including median along with average, which is a commonly
used measure for heavily skewed price measures like housing prices.
I have no idea what "race to the bottom" is supposed to mean, even after reading
all the replies. As a buyer, price is the biggest concern (excluding incomplete
entries or not up to quality standards). It's that way for any marketplace.
When I'm buying, I pick the cheapest option that has all my lots or a good
quantity and ships domestically, if possible.
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Belgium
Netherlands, Utrecht
USA, Wisconsin
United Kingdom, England
Canada, Alberta
