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# Monday, February 18, 2008
Will high-end products perform in a soft economy?
Posted by tuff

Ever since Upper Deck became the first card maker to have a pack of cards selling for more than $1, card makers have been criticized for pricing collectors out of the market. The critics remained when the first $3-a-pack products hit the market in 1993, when the first $5 packs came out shortly after that, and every time the hobby pushed past another price point previously thought to be untouchable.

Today’s new card offerings include more than a dozen brands across all sports that will cost you $100 or more per pack. Mind you, the fact these products exist is for the simple reason that there has been a certain segment of the collecting population that has demonstrated over the years that they are more than willing to fork over that kind of cash in return for a product that is perceived to be of equal value.

The card companies will still be offering a variety of super-premium card products in 2008, but what kind of reception those products will receive is still unclear. With inflation at its highest rate in 17 years, increased concerns about the stability of the nation’s economy and consumer spending on the decline, a growing number of people within the industry, particularly owners of hobby shops, said they’d like to see card companies put more resources into creating and promoting lower-priced card sets during the coming year.

The nature of the card market suggests that even if sales of high-end products were to slow down, there wouldn’t be any noticeable changes in what’s being offered until next year. The card companies plan their product schedules up to a year in advance, and they have to do so with an idea of how each product’s sales will impact their projected annual revenues.

The card makers, especially in baseball, have put a larger focus the past three years on offering a reasonable number of low-priced offerings as a way to attract more kids to the market. There are low-priced products in other sports as well, but the pro-kids marketing message that baseball has invested in requires there to be a variety of low-priced products on hand. Companies in all sports have also spent more resources beefing up their highest-priced offerings as well, because that’s where the best profit margins reside.

While there are a handful of low-priced offerings and a growing number of very high-priced offerings, the so-called “mid-priced” brands seem to have been overlooked. Those products have long been favorites of the collector who wants a little more quality than what’s found in the low-priced offerings but can’t fork over $50 or $100 on a single pack. As the median pack price increases, these collectors are finding less that fits their budgets, and consequently getting frustrated with the hobby.

The hobby can't afford to lose anymore collectors, particularly those who have enjoyed the activity into their adult years. It also doesn't make sense to roll out additional product lines that the bulk of your customer base can't afford.



Monday, February 18, 2008 1:55:28 PM (GMT Standard Time, UTC+00:00)  #  Comments [0]
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