Economic state of the Market

Happy New Year Space Freaks!

With the start of the New Year we have an update on the economic state of the hobby discussing some of the trends we’re fortunate enough to be seeing in the hobby overall.  We’ll have a few auctions but the main breadth of this update is more about what’s going in the hobby in generalities then just focusing on some of the highlights seen on eBay and other sites.

So a big question at this point would be, “how do we measure the economic state of our hobby?”

Well there are several factors that can be linked to current and future trends in the hobby, but at the heart of the state of any hobby, industry or business are key growth metrics.  In the world of public companies your stock price is the metric as it’s a key indicator of the general belief of the market in your ability to grow your business.   When forecasting in developing industries you look for product trends and demographic trends as the key metrics to pinpoint growth segments and new potential markets.    The world of collectibles is not too dis-similar in that you are looking at growth metrics to pinpoint the stability of the specific items you collect, a few of these include:

  • Appreciation of items over time
  • Demographic trends
  • Other similar segments of collecting that have consistent demand functions associated with a collectibles hobby, in the case of vintage Star Wars toys we could look at:
    • Other toy lines
    • Star Wars in general (Modern, NeoClassic, etc)
    • General economic trends, specifically disposable income

With this context in mind let’s review the current market in the past years and what type of impact certain trends are having on the hobby.

Drivers – Things that are supporting increased demand for vintage:

–       New Movies – This could be the single biggest driver of demand and appreciation of value of the Vintage line.   Not only are we expecting a new trilogy, but new movies in regular succession once Episode 7 is released.  As movies are the core of the franchise and the ultimate driver of the popularity of the franchise this is the biggest indicator that Vintage collecting will thrive in the coming years.

–       Appreciation in value of vintage items, we’ll get into examples shortly but we continue to see Vintage prices go up and up.

–       New Toys although some have stated that re-releasing the vintage line would cause some detriment to the hobby we really haven’t seen this occur.  Rather value in Star Wars toys started to skyrocket in the mid 90s with the release of the POTF2 line, and with the Star Wars toy line running for 17 years straight it’s hard to argue that mand is faltering and that current items are taking the place of Vintage items on

–       Demographic trends  – the biggest trend that is currently driving the value of vintage is the fact that those who first saw the movies and had the toys as children are currently at an apex in their life when it comes to their discretionary income and interest level, when compared with overall interest and investment into the hobby.

–       TV Shows – Toy Hunters, Collection Intervention (okay maybe not Collection Intervention) and the Clone Wars all have a major impact of the visibility of the toy line to the general public.   This alone would be a major sustainer of interest in the  hobby as I brings in new collectors and shows the franchise.  In the case of Toy Hunters you have general evangelization of the Toy collecting market, which in turn brings new interest to all segments of toy collecting.

On the inverse side there are some trends to be wary of:

–     Barriers to entry – Availability of good examples and price of said Toys. As you’ll see in the general update below, good condition vintage items are really starting to drive premium prices in the market.   The key phrase in that sentence to focus on is “good examples” as this is where we see the most growth and the most demand in the hobby.  There will always be collectors who are content and happy with owning a collection, but owning a high quality collection is becoming more and more difficult.

–     Deterioration of Packaging and Overall condition.   From bubbles turning yellow, to shipping damage, to natural disasters like Hurricane Sandy, numbers of these products that are available on the open market in good condition are deteriorating.   Some of it is due to age, but a lot is just due to improper handling of the items themselves.   Having sealed items in a home that is prone to drastic temperature changes, exposure to smoke and light are key things that are impacting the number of good examples in the market.  And with our mention of Hurricane Sandy we know that in coastal regions entire collections can be swept away or destroyed instantly.   Thus there are continuous factors that deteriorate the availability of good example items in the collecting community.

As mentioned earlier price appreciation is a key driver of the long term viability of the hobby.    And with that let’s review some recent auctions and see how they are performing against historical sales.  I like to use the ROTJ line to showcase a few different points:

  1. It’s the most widely aggregated line in the series with 79 Figures, Dozens of Vehicles, Mini Rigs and Play sets
  2. The series offers some of the most palatable price point for new collectors.
  3. There’s a lot of breadth in the line so there are a number of items to bench mark against.

Thus we have some comparisons below to historical value measured by transaction prices.  All figures are what most would call good condition, being ROTJ items I only focused on clear bubbles and C8 or better condition as measuring sticks.

ROTJ MOC Examples:

  • Biker Scout – $170 – Clear Bubble AFA 85 = 17% increase.
    • 2012 = $145 AFA 85 Clear Bubble = 70% increase.
    • 2011 = $85 AFA80 Clear Bubble 
Biker Scout

Biker Scout

  • Klaatu $290 (Variant) – Clear Bubble – AFA80
Klaatu

Klaatu

  • Klaatu – $200 AFA85 = 60% increase.
    • 2012 = $75-125 C8 or Better Clear Bubble = 15% Low end to 25% high end increase.
    • 2011 = $65-100 C8 or Better Clear Bubble 
  • Cloud Car Pilot $144 – Clear Bubble MOC = 19% Increase
    • 2011 – $121 MOC Clear Bubble
Cloud Car pilot

Cloud Car pilot

Bespin Security Guard

Bespin Security Guard

  • Luke X-Wing $179 –- MOC Clear Bubble = 35% Increase
    • $132 – MOC Clear Bubble
Luke X-Wing Pilot

Luke X-Wing Pilot

  • C-3PO $173 – MOC Clear Bubble = 50% increase.
    • 2011 = $115 MOC Clear Bubble
C-3PO (Removable limbs)

C-3PO (Removable limbs)

  • Luke Hoth $228 – AFA80 – Clear Bubble MOC
    • 2011 = $85 AFA80 Clear Bubble
Luke Skywalker (Hoth outfit)

Luke Skywalker (Hoth outfit)

  • Yoda $289 – AFA80 Clear Bubble MOC = 163%
    • 2011 = $85 AFA80 Clear Bubble
Yoda - Jedi Master

Yoda – The Jedi Master

  • Rebel Commando $224 – AFA85 – Clear Bubble MOC = 65% increase.
    • 2011 – $135 AFA85 – Clear Bubble
Rebel Commando

Rebel Commando

Overall the economic state of the hobby is one of the few things in the world that is looking up and up, we see values increasing, we see interest getting larger and ultimately we see economic factors that support that vintage will not only continue to be relevant; but that it will thrive in the coming years.  With the stock market returning less and less to shareholders and our 401Ks, investing in vintage may be one of the best places to “invest” your money.

Let me finish by saying, I know that the primary focus of most collectors isn’t to invest into Star Wars and get more out of it in the long run.   This is at the core of why this segment continues to grow, as people have an emotional attachment and investment into their collections, the memories, the thoughts and the good feelings we get from our hobby are really at the heart of why, this hobby will continue to thrive in the near and long term future.

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2 thoughts on “Economic state of the Market

  1. Great to see increasing interest and prices in the vintage collecting arena but it makes me regret not picking up the ANH and ESB figures on ROTJ cards when they were cheaper.

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