The Business of Collectables: Preserving Your Collection in the Cloud

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1 The Business of Collectables: Preserving Your Collection in the Cloud

2 Every passion borders on the chaotic, but the Collector s passion borders on the chaos of memories Walter Benjamin Sizing Up The Collectibles Market A collectible is a physical asset that exists in limited supply. They usually provide a certain level of enjoyment for owners. And are expected to increase in value because of inflation or supply and demand factors such as popularity and scarcity. Collectors, people who specialize in finding collections, scout the world to build their collections. Some of the absolutely fantastic and valuable items that get brought into the auction market each year, items that settle the heights of believability and sell for much more than their original sellers could ever have imagined, often come from common-place mom-and-pop garage, estate sales, and small-time auctions. Collectables are items of limited supply that are sought for a variety of reasons including a possible increase in value. In a financial sense, collectables can be viewed as a hedge against inflation. Over time, their value can also increase as they become more rare due to loss, damage or destruction. One drawback to investing in collectables is the potential lack of liquidity, particularly for very obscure items. There is also a greater risk for fraud within the collectibles market. Collectables As An Investment It is said that nostalgia runs in 20-year cycles. In other words, the things that are popular now will become collectibles in 20 years when people want to reconnect with their past. This doesn't mean that you can buy the top 10 items from consumer polls, incubate them for 20 years and then sell them for a fortune. It means that some items this year will become collectibles if they meet two conditions: rarity and appeal.

3 Rarity is becoming a harder thing to find as mass production methods allow companies to meet demand without incurring that much extra cost. As an example, Beanie Babies have devalued as more and more product lines are introduced. It is profitable for a company to sell more products, however, mass production is exactly what destroys the item s potential value as a collectible. Appeal is also a difficult factor to assign a value to. To make money at collecting, you have to predict what will become popular in retrospect - perhaps something that is not in high demand now will become popular in the future, either because they are rare or they were not fully appreciated at the time. For example, in the 1950s and 1960s, metal school lunch boxes were sold for a few dollars in drugstores, and can now fetch thousands of dollars in collectors' markets. Not All Collectibles Are The Same

4 Some will appreciate rapidly, some will just keep up with inflation and others will lose their value as tastes change. The factor that will make collectibles shine as an investment is the pleasure (utility) they provide on an ongoing basis. They can provide an annual dividend that is not taxed. This only occurs, however, if you are a collector, meaning that you enjoy either the collecting or the possession of the items collected. But one can be a collector and an investor at the same time. It is often said that, if you are a collector, you should buy only what you like and not worry about future increases in value. This is a partial truth. There are several reasons for most collectors to be concerned with the value of what they buy. First, if you are buying long-term quality items, you can think of part of the purchase as an investment and part as expenditure if it has a proven value over the years. If you buy something that has no history or market, you have to consider all of it as an expenditure. A second reason to consider future value is to help you decide what you should buy first. If there are two items you would like in your collection, it is wise to consider their potential appreciation over the short term and buy the one that may appreciate most quickly first. Otherwise, you will have to pay more for it in the future than you would have to for the slower appreciating item.

5 Collectors and the Internet With the advent of the Internet, collectors now have many resources at their disposal, including: personal sites presenting one's collection, online collectible catalogs, dealer/shops websites displaying their merchandise, Internet trading platforms, collector clubs, collector forums and collector mailing lists. Internet auctions are helping to dramatically reduce the transaction cost for many collectibles. In fact, ebay alone handles roughly $3 billion a year in collectibles sales via its web site. At auction, both the buyer and seller pay a premium to the auction house, reducing overall transaction costs and making it a much more appealing purchase.

6 Because the Internet also provides for the opportunity of direct contact between collectors in most areas, it often results in private sales. In the past, coin and stamp collectors have had the opportunity to trade among themselves, which substantially lowers their transactions costs. In contrast, art, antiques, books, antiquities and artifacts have usually had very high transaction costs because very little opportunity has existed for collector-to-collector transactions. In many of these areas it would not be unusual for a dealer to charge twice what he would be willing to pay for an item. Think of Your Collection As a Database There are a number of advantages to creating and organizing a digital version of your collection. First, as an overall inventory management system, it s imperative to maintain a database of your stuff. For insurance claims alone, you ll need this as proof of your purchases. It also helps you to better analyze your collection, understand where you need to invest, as well as where to diversify. A database is a computer application, such as Microsoft Access, that is typically much more technical than a spreadsheet, like Microsoft Excel, and would require a database manager to set-up and maintain. By creating a database, you can store, search, and retrieve all sorts of data attached to your collectibles photos, product literature, receipts, proof of authenticities, related articles, expert videos, and so much more. It s a way to centralize all of your collection-centric data. Publishing Your Collection in the Doolli Cloud Today, thanks to advances in Cloud Computing and database technologies, Doolli.com offers an easy platform for collectors to create, publish, and share a database around their collections, all without having to know-a-thing about databases.

7 And, your collection lives in the Cloud, which offers collectors the following advantages over traditional desktop/server-based databases: Doolli offers collectors an easy way to control over who gets to view them, what information they get to view, and who can edit or contribute. Doolli s access control is key to publishing your collections for just you, or the entire world to see. Doolli allows you to embed your collection, or specific items within it, in your web site or blog. Doolli lets collectors share what they want with whom they want, in a way they want them to view it. Doolli makes it easy for users to socialize their collectibles, and post via Facebook, Linked-In, Twitter, Instagram, and more. Conclusion: Collectors Come of Age Whether you re a collector of great works of art, or mid-century antiques, or pez dispensers, your collections speak volumes about you and how you perceive the world. And, sometimes collections can seem like family. After all, for many, they re a lifetime pursuit, an obsession, bordering on compulsion. And, of course, they can also bring riches to those collectors rewarded for being smart, strategic, organized, and sometimes a little lucky.

8 However, increasingly, collectors will need to become better at managing data as we move deeper into the connected world and our collections, represented by their virtual versions, will require management over. Fortunately, there are platforms, like Doolli, that have done all the heavy-lifting, so that collectors can continue to collect, and curate their digital collections without too much technical proficiency. For more information on Doolli, visit us at