I recently met with a potential client who was unhappy with the prices he had been getting for comic books on EBAY. He had a large collection to sell and wanted to use the capital to start an online comic store. He was hoping to keep as much of his personal collection as possible to use as a back issue inventory. During the meeting we did some searches on what he had sold. Checking comparables, we found that he averaged anywhere from 10 cents to 40 cents in profit per comic. That seemed to be roughly the same as other sellers. So we had a good idea of what the market was bearing. I asked for a summary of what his online store would include and was dismayed at the outline he provided. There was nothing different about it, yet he was looking for a higher value on his comics.
What he laid out was a simple online store. With a few brochure style pages (about us, policy, contact etc.) The problem was he wanted to double or triple what he was getting on EBAY. EBAY isn’t going away and for any collectible market, collectors typically have a good idea of what they can nab things for on auction sites. If they pay more there is a reason for it. I asked some questions about things he might do to make his site more appealing for collectors:
- A blog offering reviews, though there were already a lot out there, was an option.
- How about the market of comics, a buyers or sellers guide, there seemed to be fewer of those.
- How about speed, making the comics available faster
- A niche market, servicing only a set geography or fan base.
- The most valuable service I thought would be personal recommendations from him to his customers on things they should be getting.
Every suggestion was met with a lukewarm response. In the end, I realized that he didn’t want to take on any of the extra work to differentiate himself. He just wanted things to sell at a higher price without bringing any extra value to the table.
This is such a prevalent misconception about the Internet. It takes work to succeed. If it didn’t, everyone would be Internet millionaires. Furthermore, it takes good ideas and differentiating yourself. It doesn’t have to be a radical or market changing idea (though that helps) but it has to be something. What was most discouraging about this case was that I thought he understood that he’d have to bring something special to the table. He seemed more than capable. He was excited about comics and knew a lot about them as an industry, entertainment, and collector’s item. He told me how he scoffed at people on sites like EBAY or Craigslist that asked 75 cents a dollar, or more per comic. He laughed that when looking to purchase collections, many people who made him offers like that thought they were providing a real bargain. He seemed to know that something special had to happen to get a higher price per unit.
Ultimately, he understood but didn’t want to do anything about it. His plan was to set himself up as a more official version of the people asking prices he felt were too high. That’s not differentiation, it’s ego. I’m rarely a critic of having higher prices because it’s extremely hard to win the price wars online. There’s usually too much competition and cutting prices is often a sure fire way for a business to fail. However, something different and valuable needs to exist for people to justify paying more. If you aren’t doing that, you’ll become the next joke of the market, asking too much and offering nothing special in return.