RINKER ON COLLECTIBLES — Column #1566
Copyright © Harry Rinker, LLC 2017
Top Ten Changes in the Last Five Years (2011-2016) - Part IIIThis is the final column of a three-part series analyzing the Top Ten Changes that occurred in the antiques and collectibles field between 2011 and 2016. I ranked the Top Ten changes in order of importance and am presenting them in reverse order. ROC #1562 and #1564, the two previous columns in this series, covered: No. 10 – Decreasing prestige associated with owning antiques and collectibles; No. 9 – Slow and often painful recovery from the 2008-2009 Great Recession; No. 8 – The end of an era – the passing of the 20th century traditional collector; No. 7 – Shifting importance within sale venues; No. 6 – Growing speculation; No. 5 – Growth sectors: international and regional; No. 4 – Shifting buyer base. This column discusses the top three changes.
3. Increased competition for discretionary income
The financial health of the antiques and collectibles secondary market is highly dependent upon discretionary income. Discretionary income is the amount of money a household or individual has to invest, save, or spend after purchasing necessities and paying debts and taxes. For many members of the lower and middle class, especially Millennials, this number has decreased rather than increased over the past five years.
Antiques and collectibles are not necessities. It is possible to live without them, albeit those who attempt this enjoy a less meaningful life. When creating a monthly or annual budget, setting aside money to purchase, preserve, and display antiques and collectibles is a low priority.
Some argue that an antique’s or collectible’s utilitarian/function aspect, especially when a “used” item is cheaper than new, and/or its decorative/emotional/nostalgia value is sufficient to encourage buyers to use their necessary rather than discretionary income. There are counter arguments. First, there always is a new item that is cheaper than the old. Second, newer items are easier to find and often more fashionable than an older item. Third, the percentage of decorators, amateur or professional, that use antiques and collectibles is small compared to those who prefer new, a view shared by their Millennial clientele.
Even though Millennials have a higher rate of unemployment of any generation and are plagued by debit, they still spend a large portion of their income on discretionary and luxury items. Where do they spend this money? Education, entertainment, eating out (fast food more frequently than family dining), technological gadgets (an Xbox or PlayStation is not a necessity), fashion apparel, travel, jewelry, and more. Antiques and collectibles do not appear on any list encountered. [For more detail, see: https://generationalinsights.com/milliennials-are-big-discretionary-spenders/]
Forget saving for an automobile or home. Long-term investments, including setting aside money for their children’s education, are an afterthought. The Entitled Generation, the generation following the Millennials, carries the “Me” from the Me Generation (the second half of the Baby Boomers) to extremes.
Saving is a critical component in the collecting mindset. Collectors commit to saving objects. The reasons are many. The concept is the key. When saving becomes an alien concept, the antiques and collectibles community suffers.
2. Widening price gap between low-end and top-end pieces
At times, it appears the middle has disappeared from the antiques and collectibles market. Instead of a gradual escalation of quality and value from the most common to the scarcest item in any collecting category, there are now huge pricing gaps. Although low-end (common) items are affordable, no one wants them. No prestige results from owning them. Their bragging rights have disappeared.
Throughout much of the 20th century, the middle value levels of any colleting category began around $75.00 and ranged up to $500.00 per unit. The upper limit was a stretch but obtainable for most individuals.
As 2016 ended, objects priced above $300.00 to $350.00 dollars and below $2,000.00 dollars were difficult sales. The situation arose where new buyers (I hesitate to use collectors) wanted the best or nothing at all. When the low unit price for the best exceeded $5,000.00, individuals sought other areas in which to spend their discretionary income.
With the exception of a few collectors, the social and personal recognition associated with owning a top-end piece faded. Brand name products had more pizzazz than any antique or collectible. It is often possible to count on two hands the number of individuals who are wowed by the fact that a collector owns the ultimate unit (masterpiece) in any collecting category. Does the fact that someone paid $486,100.00 for a J. & E. Stevens Jonah and the Whale mechanical bank impress you? There was a time when it impressed me. It no longer does. In an industry where record prices now register in the millions, what is $486,100.00?
Auction houses have contributed to this price gap differentiation. A regional house willing to accept objects or lots for sale with a potential hammer bid less than $300.00 is rapidly vanishing. Six hundred dollars per object or lot is replacing $300.00. The same is true of national auction houses. A few still have a $2,000.00 per object or lot threshold. The lower limit is now $6,000.00 at some of the top houses. Who has a house full or collection with this level of material? “Not I said the fly, not me said the flea.”
The increasing values at the high-end of the market has led to a new wave of speculation as auction houses and others have convinced high-paid athletes, entertainers, and money moguls to buy antiques and collectibles as tangible assets. Once again, hype is value in 2017 and will remain so until there is another recession, bubble burst or a mystical revelation that speculative purchases are speculative, exactly what the word implies.
1. Digital Age’s impact
The Digital Age is reality. It was in 2011, but it is even more so in 2017. The 2016 holiday shopping season confirmed the prediction of many retail pundits. The Age of the Walk-In shopper is ending. Large store changes, such as Macy’s and Sears, are closing stores. A January 9, 2017, AOL headline story read: “The Limited [a woman’s clothing store] suddenly shut down all of its stores [around 250] and laid off thousands of workers.” The Limited will not disappear. Sales have moved to an online catalog website.
Antiques and collectibles consignment shops, estate sales, flea markets, malls, shops, and shows are dependent on walk-in customers. The auction community is the primary antiques and collectibles sale venues that is successfully transitioning to the Worldwide Web.
KP (Krause) Publications, Schiffer Publishing, and a few American independent publishers of printed antiques and collectibles reference books and price guides deserve praise for their persistence. Digital access to older research texts remains minimal. The same is not true for pricing information. WorthPoint.com’s sell-through data base continues to increase. I use it regularly. The information presented is raw data and needs to be interpreted, a skill easily learned. WorthPoint.com marks identification and other features promise to make it the antiques and collectibles trade’s go-to website for identification and value information.
It will take another five years or more for the antiques and collectibles trade to transition to the Digital Age. Online antiques and collectibles storefront websites, such as RubyLane.com, have stood the test of time. This approach appears to have stabilized. Growth is centered in highly specialized individually owned websites. One example is www.brickpicker.com, a Lego collector website. These specialized websites can easily be found using search engines.
Specialized websites represent one of the principal difficulties in the antiques and collectibles trade’s transition to the Digital Age. They isolate collectors and buyers from the general antiques and collectibles community. Specialized websites prevent a broadening of the collecting horizon. Their narrow focus also clouds long-term future analysis of the broader market.
Participating in the Digital Age requires a financial investment in hardware, software, and a commitment to keeping up-to-date with the latest technological advances in both. It is no longer possible to sit back and rely on what one already knows.
The Digital Age also has created attention span issues. Collecting requires the ability to stay focused for years, if not decades. The length of time a collector commits to a specific collecting category is decreasing.
The Digital Age offers the opportunity to digitally collect. Websites such as Pinterest already are touting this concept. What does this mean for the future of collecting? Is the assembly of a pictorial archive enough to satisfy a collector? Will there be a time when the physical object no longer matters? The answers should be a resounding NO. Should be is not the same as is.
What do you think of my Top Ten Choices? What did I miss? Which deserve further elaboration? Email your thoughts to email@example.com.
Those wishing to read all three columns in this series and the “Rinker on Collectibles” 30th Anniversary column are directed to the URL “Rinker on Collectibles Special Series” found on the homepage of my website www.harryrinker.com.
Harry L. Rinker welcomes questions from readers about collectibles, those mass-produced items from the twentieth and twenty-first centuries. Selected letters will be answered in this column. Harry cannot provide personal answers. Photos and other material submitted cannot be returned. Send your questions to: Rinker on Collectibles, 5955 Mill Point Court SE, Kentwood, MI 49512. You also can e-mail your questions to firstname.lastname@example.org. Only e-mails containing a full name and mailing address will be considered.
You can listen and participate in WHATCHA GOT?, Harry’s antiques and collectibles radio call-in show, on Sunday mornings between 8:00 AM and 10:00 AM Eastern Time. If you cannot find it on a station in your area, WHATCHA GOT? streams live on the Internet at www.gcnlive.com.