Lizard's Rant

Ben Henry runs arguably the best card blog on the web - The Baseball Card Blog. If you don’t already read it, you should. The other day he posed an interesting question: in five years will Beckett and Tuff Stuff have price guides that still matter in the hobby?

With its low prices and open-source approach to assigning realistic value to cards and memorabilia, it’s the new face of the hobby. It’s slowly killing independent in-shop dealers. It’s taken the bottom out of the value of game-used, relic, auto and other seemingly hard-to-find cards. That Poley Walnuts insert of the squirrel at Yankee Stadium from last year’s Topps? Tuff Stuff has it at $40. Here are two eBay auctions: one’s at $1.25, the other at $0.99.

I know I’m not the first person to bring this up, but have you really thought about what the hobby will look like in the next five years? I think it’s fair to say that both Beckett Publications and FW have enough money to continue publishing their respective fleets, but what will be in those magazines? Or, more appropriately, what will be on their websites? Will there still be price guides? And if yes, will the prices they hold mean anything?

People get pissed at me/us because our Price Guide isn’t perfect and doesn’t have everything listed or the data suggests that their card is worth less than they thought. They yearn for a nice little Beckett that has every price listed out, even for cards that never sell and there’s no data and the value is just an over-inflated guess. They’re happier with a quick and partially-inaccurate price than they would be taking 15 minutes to use all of the information available to come up with something better. Our FAQ is very clear that we don’t see our tool as the end-all-be-all, but as just one of the ways to improve the way collectors research card values.

I’ve said it before and I’ll say it again: our price guide is a tool (one that I’m willing to admit has a learning curve and can be rough around the edges at times). Beckett and Tuff Stuff are tools, each with some merit. eBay is a tool. If you get enough data points from the various tools out there, you’ll get a good estimate of what something is “worth”. A card is “worth” what someone will pay for it. The variables involved in that - condition, location, time of the year (in season or out of season), the players current performance, grading, etc - are so different for every card that it is impossible to tell exactly how much any one card is worth.

Even a duplicate of the same card, in the same condition, can sell very differently at card shows in the same city on consecutive weekends. As of now, the 6 step process for determining a range of values that I wrote is the most data-driven solution that I know of - it factors in eBay data, price guides, and some common sense. Whenever people complain to us, I always send them a link to that post. I doubt they ever read it. They probably just go to the book store and pick up a Beckett and get on with their day. That’s fine - but then when they go to sell it and get pissed that they get 10% of BV for a card they aren’t exactly happy with the hobby and likely to pour more money into cards in the future. Inflated BVs help “protect” dealers in the short term, but kill the hobby long term (hello, this isn’t new news so why can’t they see it unfolding???).

After receiving a bunch of interesting comments (mostly in agreeance with him) he wrote a follow-up post breaking down a scenario of the future of card shops:

Here’s the situation. The list prices in price guides have been deemed useless on such a massive scale that Beckett and FW have ceased their publication. With no widely available prices, the majority of collectors now consult eBay for accurate card prices.

Dealers do the same. And after they view the umpteenth autographed patch 1/1 card go for less than $20–pulled from a box that dealers paid a premium on to sell–they stop ordering high-end products from the manufacturers. The dealers understand that if they’re seeing these auctions on eBay, their potential customers are winning them.

So many dealers stop ordering these cards that the manufacturers have a difficult decision to make: finally listen to dealers and put more value in each box of product, or dismiss dealers altogether and work exclusively with big box stores like Target, Kmart and Wal-Mart. It comes as no surprise when the manufacturers go with the latter choice.

Because the majority of shops deal primarily in new cards, they start to close. Collectors don’t notice right away, as most of them are tuned to eBay. And besides, the hobby’s gone through this before and survived, so what’s the big deal? Also, everybody’s got a Wal-Mart near them, so who cares if one more shop goes out of business? Shops sell off their inventory and shutter.

Dealers at baseball card shows don’t feel the same pressure right away, though many of them do feel their brethren’s plight. Instead, without book prices to consult on every transaction, desperate, frenetic dealers result to using their best judgment. Collectors, fully aware of the situation dealers are in, refuse to be charged “judgment call prices.” Many dealers, citing lack of meaningful sales at shows, stop booking booths. What few shows remain shrink in attendance until they cease to exist. The National is the lone exception, chugging away, though it’s a magnet for news media to lament the hobby crisis. “Ain’t in the Card$,” is the New York Post headline.

Without dealers, the manufacturers are no longer in the dominant bargaining position. They’re at the whim of the big box stores. Product’s gonna be late? OK, we’re diminishing your shelf space. The manufacturers are not used to their role as ‘just another product.’ What happened to all those dealers they used to push around?

He goes on to admit that it probably won’t play out that way, but at least people are starting to think across these lines. I’ve always maintained that a lot of the hobby’s struggles have come from the wacky fact that it has evolved unlike any other industry and isn’t (completely yet) subject to the same free-market rules as other businesses. It hurts the cards and collectibles industry, it hurts collectors. Todd McFarlane gets it. eBay gets it. NAXCOM seems to get it. Most of the rest still don’t.

Personal example. When my partners and I launched Tastefully Driven, one of the initial “stores” we wanted to have was a high end online card shop. Cool right? Well, we became so thoroughly frustrated with the process of becoming a distributor and the ridiculous requirements that we canned the idea. Why am I going to put up with Upper Deck’s bullshit when in any other industry I can get on the phone directly with the company and start an account with them in a few hours? They think they’re doing the hobby a solid by only allowing card shops to sell their products, but they are preventing it from getting in the hands of the retailers who can truly make a difference. So instead we’ll devote that effort to selling our other products and we’ll be successful because we’re good at online business and Upper Deck and the hobby lose out. Maybe we would have poured resources into innovating the hobby. Now we won’t. Stupid stupid stupid.

So would we be better without Beckett and Tuff Stuff? Maybe. Maybe not. It’s too early to tell, but it sure will be interesting to see if they and the card companies evolve their business models or keep treading along like we’re still in 1990.