Before I begin, I have to state that I’m a geek. The rare variety of geeks – a female. Personally, I’ve collected a lot more items then I care to speak about, but one effect that I have noticed is what I’m calling “The Bell Curve of Collectibles.” So with the Comic Convention season almost here, this article will explore the demand/supply side of the world of collectibles.
Most major movies formulate their marketing campaigns with a component called merchandising. Merchandising goes into production at the same time as editing is being done so that the products get released before the release of the movie. Timing with fast food franchises also come into play. The movie producers know that the opening weekend box office figures will determine if the film is a success, so all the promotion, hype, media attention, and merchandising has to peak in effect when the movie hits the screens. This works to the advantage of the movie producers but against collectors like me.
If you imagine a bell curve, collectors typically start collecting on the upswing. The upswing is the gradual market awareness of the movie. During this upswing, specialty items are released that are in limited supply. A hand-numbered, limited-edition collectible (1 in 1,000) run of an item is sure to make geeks like me covet. As we move further into the upswing, these items in a collector’s possession achieve a status and an increased value as demand and awareness increase. More merchandising comes out and we are driven to purchase to complete a set or add token items to round out our display shelf. Demand continues to increase. The smart collectors sell their collection right about now instead of adding to it.
Fast forward a few weeks and supply increases to meet the increased demand. The film gets released into theaters shortly thereafter and the market floods. EBay offers for collectors items are at their peak, but as the general audiences are coming to the theater, the sales on EBay decrease. Collectors who try to sell their items now are running into a lack of buyers. This, more often than not, has been my position. Now the collector is stuck with a set of dust-gathering knick-knacks. The only hope to earn an increased appreciation for those items is if the movie gains an additional enthusiasm bump by earning cult status. This very rare phenomenon happens when distance and time are added and the effect explains why some promotional items fetch enormous amounts at auction ten, fifteen, or twenty years after their production.
Much like investing in an IPO, which shares this same pattern of activity, the key to appreciated value is to know when to get in and when to get out.
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