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Auction Business Needs To Step Off The Throttle

on September 2nd, 2010 by Tuff Stuff

Are you familiar with Spanish philosopher George Santayana’s famous line: “Those who cannot learn from history are condemned to repeat it”? Well, don’t feel bad because it appears most involved in the sports memorabilia business never heard of it either.

I was really a collector until I took over the editorial reigns of Tuff Stuff’s Sports
Collectors Monthly about five years ago and since then my collecting habits would
be modest at best. So unlike others who have been in the industry, I don’t know all
of the history that has shaped the hobby into what it is today. But one thing I learned
about the sports card industry during
my time here is that too much of a good thing is almost always a bad thing.

When the hobby boom took off in the late 1980s and early 1990s, new card companies
jumped into the fray and the existing card companies cranked out set after set until
the supply far outweighed the demand. Everyone wanted a pie of the pie but when the
smoke cleared, the hobby was left with an over-saturated market and millions of worthless
cards. Collectors eventually figured this out and shifted their collecting focus from
cardboard investments to pretty much anything else, as the heavily populated market
had people leaving the hobby in much the same way a burning building does.

After years of industry experts screaming for brand proliferation and a drastic reduction
in the numbers of card sets they wanted to be produced, the card companies eventually
relented and put the brakes on. In recent years the trend has continued with fewer
card companies being licensed by the leagues which ultimately led to fewer, but in
theory, better products available to consumers.

While all that was going on, many collectors shifted their focus from new cards to
vintage materials and as card shop owners struggled to survive in a lean market, they
shifted their focus as well. In the early days of the sports memorabilia business,
auctions featuring high-quality vintage material was reserved for the elite. It featured
a few lots of big-buck items to bid on and the frequency of the sales and the companies
host them could be easily tracked. But as some of the big auction houses spread their
inventory out to include items that wouldn’t break the bank and afforded the average
collector to jump in and slam down the gavel, the auction business grew as exponentially
as the new card market dried up.

Targeting new auction customers, most of which were collectors looking for more stability
than the basement full of new cards that weren’t worth enough to ship to a potential
trade partner, the auction house boom led by eBay, was born. Record prices for vintage
materials were being realized online and throughout country, as everybody caught auction
fever. With everybody looking to “win” items with the highest bid, everybody and their
brother was starting up their own auction business.

Initially, there was plenty of great memorabilia for everybody to prosper but eventually
many of those businesses who had missed the boat when it initially left the dock were
folding up like beach chairs on a rainy day. And that takes us to today’s market where
many are still looking to cash in on the auction craze but the wealth of materials
available running a little thin as everybody tries to grab a piece of the pie.

If you do a Google search for sports memorabilia auctions you’ll get a whopping 102
million results. It seems that many involved have forgotten a valuable hobby history
lesson and might just be condemned to repeat it if they’re not careful. Sometimes
to much of a good thing is a bad thing and today’s auction market might just
be the perfect example.

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