Eye Appeal as a Marketing Tool

Monday, March 1, 1999

        It seems like the New Year just began and we are already heading to the ANA in Sacramento, March 10-14. The FUN Show, Long Beach, ANA, then Baltimore and the next thing you know it is time for Central States. Not only do we have an impressive schedule of shows, the auction excitement is quite intense, as fresh new coins are available everyday. How can this current market support all the coins available in dealer inventories throughout the country? With prices moving higher for most series and grades, collectors who would not have considered selling some of their holdings are now doing just that. It has become a seller's market, as quality material will command 'above the norm' prices.

        Now back to our original question. How can this current market support all the coins available in dealer inventories throughout the country? The answer is not a simple one, but it is what makes the coin industry the best collectible market in the whole world. There is a horse for every saddle and a saddle for every horse. The coin market is made up of every type of buyer you can imagine. There are collectors who buy according to series, date, price, quality, gold, silver, errors, and variety; we could go on and on. Right now there are so many buyers of coins for so many reasons that we could…write a book. Well, we would probably be a little late because Mr. Bowers has either already written it or is in the process. For now, let's just get back to the question at hand.

        In the last two years there has been an influx of new collectors testing the coin market. There are people with small amounts of discretionary income to spend and there are those who have so much money they don't know quite what to do with it. So they diversify-from the stock market to collectibles; and the coin market is the beneficiary. 'Fresh' coins that have been off the market for quite some time attract a multitude of buyers who are seeking to upgrade and own the very best in numismatics. This is the main reason that the coin market is so active at higher levels. When this type of material comes into the marketplace, it not only commands high price levels, but the rest of the coin market joins in and prices rise. When there is such a diversity of demand, it carries the whole market to higher levels. As you can see, the strength is in the anticipation, as well as the demand for new material.

        Not every collector can afford to spend the amounts of money that it takes to support the coin market and higher prices. Again, this is what makes numismatics so interesting. Many coins do sell at 50%-100% over other coins of the same described grade. 'Eye-appeal' is a tremendous asset; some coins have it, some don't. It is more a matter of degree than anything else. If you line up 100 coins (from best to worst) of the same date, denomination, and grade, you will find an extreme difference between the nicest coin and the least attractive coin. Even though they may technically be the same grade, the best might sell to a knowledgeable buyer for 50% above the unattractive example. This is what accounts for the market's ability to support dealer inventories. Long-time collectors, along with the new collectors, want the best they can afford and will buy what dealers have in stock as long as it is priced commensurate with not only its grade, but also its eye-appeal.

        Education is the key to the strength of the current market and the potential future rise in price levels. As we mentioned earlier, many new collectors are testing the coin market. They are starting off by purchasing inexpensive coins and comparing grading and pricing from one dealer to the next and testing the differences in the grading services. As they educate themselves and become more comfortable with these elements, they expand their purchases to include higher priced coins. We are all in the business to educate as well as market coins. Some dealers educate more efficiently than others do; some educate without knowing it. The coin market of tomorrow will be judged by the amount of effort we put into it today.

        Heritage Numismatic Auctions, Inc. is conducting the Sacramento ANA National Money Sale March 11 & 12. There are over 1800 lots with an impressive variety of U.S. coins and currency, along with foreign coins. A few of the more interesting issues are the 1918/7 S Std. Liberty Quarter PCGS MS63, an 1895 Morgan Dollar ANACS PR64, the 1804 $2½ Gold 14 Star Rev. PCGS MS63, the 1804 $5 Gold Sm 8/Lg 8 NGC MS62, the 1907 $10 Gold Rolled Edge NGC MS65, and the 1882 $20 Gold PCGS PR65.