eCommerce

As Classic Video Games Turn Into Collectibles, Can eCommerce Keep Up?

video game cartridges

Here’s a truth about human beings: We’ll collect — and resell and profit from — just about anything. And the latest big trend in collectibles combines what amounts to a hat-tip to essentially ancient digital culture with up-to-date eCommerce.

It seems that old-fashioned video games are that hot new item, assuming they are in pristine condition and come in factory packaging, according to a new report in The New York Times. In fact, interest in such games “has soared in the past year, with some companies aggressively targeting collectors from more established markets,” according to the report. “The hottest investments are games for the Nintendo Entertainment System, which popularized characters like Link, Mega Man and Mario in the 1980s.”

Flip and Profit

The general idea, of course, is to buy low and sell high, or, in the words of the report, “quickly flip the most coveted titles, making thousands of dollars in profit and fueling concerns of unsustainable hype. Collectors say that multiple gold copies of Nintendo World Championships — only 26 were distributed, making it one of the rarest N.E.S. games — have reached the six-figure threshold in private sales.”

This latest trend in collectibles — or potential bubble, perhaps — reportedly is raising concerns about speculation and inflated prices, and even fraud, and is likely driven, at least in part, by nostalgia for that period of digital entertainment, when the people now known as Generation X got giddy for video games that seem primitive (but are still often popular) now. Indeed, when it comes to younger consumers these days, eSports are reportedly on the rise (including with high school students), and are even prime part of plans to revive retail malls and to collect more states taxes, as PYMNTS has covered.

But as even casual students of history know, collectibles often lead to bubbles that eventually pop. In part due to changing consumer preferences, along with classic supply-and-demand dynamics, such previous lucrative collectibles as fine china, commemorative coins, figurines, Longaberger baskets and other such items are unlikely to make as much of a profit — or even break-even return on investment — as was once the case, at least according to one analysis.

No doubt millennials will be blamed for some of this, as they have been scapegoated for the decline of diamonds and certain fast-casual restaurant chains. As that reports notes, “Older generations’ basements and attics are full of boxes of ‘stuff’ that was collected in the past. The wave of minimalism — the newer generations don’t want the ‘clutter’ — has created an excess of supply against a smaller demand. Most often the only exception for these items is if they are family heirlooms. And even then, the items usually only have sentimental value.”

But there is always some kind of market for collectibles, and not just video games from a generation ago. Take the general toy market. In the past few years, collectibles were recently on a tear: Global sales recently have been rising. And amid toys in the collectibles market, L.O.L. Surprise! has been among the leaders in global sales.

Subscription Collectibles?

And more growth is seen among the edges of the collectibles space.

That includes luxury timepieces which are often purchased as keepsakes. In fact, the rising practice of subscription commerce is playing a role in this area. For instance, a company called Eleven James took a shot at allowing its members to essentially borrow a luxury timepiece for three months at a time, or even longer. The company maintains a collection of a few thousand timepieces from more than 30 brands, and members can experiment with different styles without having to make a long-term commitment to a particular watch. As a result, consumers aren’t stuck with watches they no longer want to own. In a PYMNTS interview, Eleven James CEO Olivier Reza, told PYMNTS in an interview, “We get them to enjoy as many watches as they want, when they want.”

But in the collectibles space, even along the edges, fortunes can turn suddenly and without mercy. Eleven James, which launched in 2013, pretty much vanished from the scene in 2018, with the company reportedly unable to land new capital or extend lines of credit, perhaps because customers tended to view luxury watches as permanent, lifetime objects, not temporary collectibles.

Let that be a lesson: Nothing lasts forever, even when it seem like a sure thing at the moment.

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NEW PYMNTS STUDY: LEVERAGING THE DIGITAL BANKING SHIFT – SEPTEMBER 2020  

The September 2020 Leveraging The Digital Banking Shift Study, PYMNTS examines consumers’ growing use of online and mobile tools to open and manage accounts as well as the factors that are paramount in building and maintaining trust in the current economic environment. The report is based on a survey of nearly 2,200 account-holding U.S. consumers.

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