I woke up to offers of almost $1,700 this morning on three stamps that I have had in my inventory since the beginning. Woo hoo!! I accepted them all and brought our monthly total, after 8 full business days to just under $3,000, breaking the record that was set in May, where after 9 days we had just under $2,400. I am incredibly happy with this. All of these offers came from a brand new customer that we just started selling to last month. He bought over $700 last month, was happy with what he received, and the service he got, and came back. The personalized service is definitely working, as I see more and more repeat customers who are recent customers.
I wanted to share a realization that came to me last week about the demographic trends affecting this hobby and the implications that I think it has for the business in general.
I have noticed that we are starting to get sales from younger collectors now, as well as female collectors, which were virtually unheard of 20 years ago. The sales are not large, but there is some repeat business that is beginning to develop. I can tell that these customers are younger by little clues, such as their e-mail addresses, or the fact that they move frequently. I can also tell by the stamps they are buying and their lack of fussiness in regards to condition. Last month, for the first time, sales of post 1952 stamps exceeded the sales of classic stamps, which are normally the domain of the older, collector from the boomer demographic or the few collectors left from the Greatest Generation.
Many people are of the perception that the hobby is dying. They are only partially correct in that the hobby in its old school form is definitely dying:
I wanted to share a realization that came to me last week about the demographic trends affecting this hobby and the implications that I think it has for the business in general.
I have noticed that we are starting to get sales from younger collectors now, as well as female collectors, which were virtually unheard of 20 years ago. The sales are not large, but there is some repeat business that is beginning to develop. I can tell that these customers are younger by little clues, such as their e-mail addresses, or the fact that they move frequently. I can also tell by the stamps they are buying and their lack of fussiness in regards to condition. Last month, for the first time, sales of post 1952 stamps exceeded the sales of classic stamps, which are normally the domain of the older, collector from the boomer demographic or the few collectors left from the Greatest Generation.
Many people are of the perception that the hobby is dying. They are only partially correct in that the hobby in its old school form is definitely dying:
- Membership in stamp clubs is declining.
- Circulation of stamp periodicals like Linns is dropping.
- Most collectors at shows and exhibitions are older.
I would maintain that much of the above is simply a reflection of the changing times. The fact is that membership in most clubs that meet face to face is declining because people are just as happy to do everything online, or people do not crave the face to face connection as much. Another possibility is that younger people find the clubs too stuffy and do not cater to their interests. This last possibility is actually quite probable, as it has been my observation that most younger collectors are interested in themes that they can relate to. Sure, they might be interested in stamps with Queen Victoria or King George V on them, but the difference is, they are content with just one, and it doesn't have to be rare.
One demographic trend that cannot be overlooked is the fact that young adults from the millennial generation today are struggling with economic realities that their parents and grandparents simply did not have to face. Millennials simply do not have as much money to spend on hobbies as these generations did. It is not at all uncommon for the average stamp collector currently in their 70's, to have had upwards of $5,000-$6,000 per year available for their hobby. Over a 30 or 40 year period, this has allowed them to amass collections in the $150,000-$250,000 range. As a professional dealer, I have seen this first hand time and time again.
Millennials today don't have that kind of money to spend. But they still need hobbies and can maybe afford $1,000-$2,000 a year - the kind of money that pays for pints of beer at the pub or packs of smokes. So given these conditions, I think that most of the demand for stamps will be in the cheaper material that can be bought for less than $10 per stamp. That price point is what allows a younger collector to regularly add to their collection. The more expensive material is simply going to be out of reach to most of these collectors.
Institutional collectors seeking the rarest of the rare will continue to push prices of that material up, but the size of that market is going to shrink over time. Millennials are not as concerned with getting a financial payoff out of their hobby the way boomers are, which accounts for why I am finding it easy to sell the cheaper, lower grade Queen Victoria stamps. So what I think we will see over the longer term is a rise in the demand for the cheaper older stamps and modern stamps, and lower demand for the mid-range, $50-$500 stamps that are in such demand now. As long as the boomers are collecting, I think demand for this material will be strong, but after they die I think we will see a sharp price correction, as there will be many fewer collectors with the financial means to absorb it.
So far from dying, I think the hobby is merely evolving. I am very excited for what the future holds for the less expensive, modern material.
Interesting on the demographics. I have a Toronto-Centric point of view, so what about the huge change in 'country of origin' i.e the fact that >50% of the population is comprised of visible minorities. Does that have an affect on the stamp hobby / business?
ReplyDeleteSure, if your business is just in Toronto. Internationally, it has created more demand for countries and topics that were traditionally eschewed by male WASP collectors, which until fairly recently dominated the hobby. It is this group that people look at by they way when they say the hobby is dying - because most of the new collectors are not interested in the same stamps that this demographic was interested in. Queen Victoria is a great example. Most stamps of the 18th century from any Commonwealth country were just stamps with Queen Victoria on them. Many collectors would spend a lifetime just collecting nothing but stamps with QV on them. Many younger people today would be happy to own just a few of these, and then move on to something else.
DeleteSo if you look at stamp collecting on Facebook, you will see lots and lots of collectors from around the world, including lots of young collectors. BUT, you will see that what they are collecting is often not expensive, and more colourful and modern. Most traditional dealers are not interested in handling these types of stamps because they consider them to be too much work. And so, these dealers often lament the "decline of the hobby", completely failing to recognize that it is a hobby in transition, not a hobby in decline.
If you look at Chinese stamps, or India after Independence, the demand is so strong that catalogues are out of date as soon as they are published. Ghandi on stamps is a hot topic now too.