The Effect Of eBay on the Stamp Market

The story of philately over the last twenty years is the story of the Internet and of eBay. It’s hard to quantify eBay’s philatelic success (as they keep their numbers for each of their divisions to themselves), but it’s clear they offer millions of lots per year to hundreds of thousands of buyers on behalf of tens of thousands of sellers. eBay probably sells more dollar volume worth of stamps than all of the other stamp auctioneers and websites combined. eBay has lowered the barriers to entry for all new sellers. In the previous generation, companies like Apfelbaum, with our large mailing list and years of customer satisfaction, had the stamp auction business locked up. New companies had a very difficult time finding material to sell, finding good customers to sell to, and having a clientele who could rely on them.
eBay was wise to put its emphasis on customer satisfaction rather than seller satisfaction. eBay has strict rules, and they almost always go back to the same guiding principle: the customer is always right. Dealer sellers have long carped about this orientation of eBay, not realizing that it is because buyers know that their satisfaction will be guaranteed that these buyers flock to eBay in the first place. eBay’s attitude is sellers will always want to offer their product in an environment where there are the most and best buyers; so attracting and satisfying buyers is their first priority. Still, there is a difference for most dealers between being on eBay and being successful on eBay. eBay’s fee structure makes it hard to make money if you wish to establish some kind of floor price for your product, as the listing fees for unsold lots are steep. Most newer dealers start on eBay and use it until they can either establish a platform of their own or find another selling venue that is less costly. Still, a new seller who has never sold a stamp before can have his product up in front of hundreds of thousands of the world’s keenest buyers in a matter of minutes. Truly, eBay and the Internet platforms like it, are among the most amazing evolutions in the history of commerce.
The effect of eBay on philatelic economics has been a mixed blessing. Certainly collector and dealer liquidity has increased as everyone can be a seller to the world’s markets at any time. This is an advantage that the internet philatelic portals have given that is hard to underestimate. And too, the vast offerings of material on eBay and other venues have driven down the price of ordinary collectible stamps. There are hundreds of thousands of collector-grade US and Canadian stamps on offer all the time, and like any glutted market, this pushes prices down. And lastly, this vast quantity of material on offer has not only reduced prices; it has reduced interest as well. Collectors used to come to their local shop and buy any new item that came in. With hundreds of thousands of stamps on offer all the time, there is little impetus to buy today. This has put further downward pressure on prices. Add to this the evidence that for the last twenty years incomes of the middle class have been stagnant, and you have have far too many ordinary stamps chasing too few buyers.
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