The View From 20,000 Feet

I wanted to start a dialogue about what I think many people are missing when they discuss any myriad of topics on this and other sites and that is the view of our ‘business’ from a distance, the big picture if you will. I'm not talking about a bubble bursting or not bursting conversation, but instead the changes in the Lego culture that have manifested over the past few years. I will start out by stating that I don't have all the answers, none of us do; but I think we need to start talking about this so that as more things come into light we are cognizant of it and can adjust accordingly. As a long time (and in my own right very successful) Lego reseller I constantly read articles and forums from a number of sites that tackle various issues as they arise, and while those are all valid in their own right and even have inklings of this topic, I haven’t seen a high level discussion on it.

I guess for me it all came to a head with Azog, that lesser character from the books that was given a new life in the movies. 100 of his minifigure were given out 'randomly' at Comic-Con 2013 and as most us know, the prices went through the roof even outselling Mr. Gold within weeks. As prices spiked north of $2,000 people were clearly wanting in on this figure and I have no doubt that there were investors out there feeling their purchases at $1,000 were a steal. After all, Lego has always had a reputation for creating very special and limited figures for events and they have traditionally been a solid long term investment or purchase for many collectors. When the news came out that this same exact minifig was being released in an upcoming set there were immediate laughs and comments relating to how fast the prices would be dropping and that it didn’t matter for the resellers because they already made their money so who cares.

Here’s where the problem starts. While I agree in this instance that’s true, what people are failing to realize is this one singular event will now FOREVER tarnish in people’s minds that they can never be certain that a "special edition" piece whether from Comic-Con, Toy Fair, or anywhere else is sacred. They (Lego) have now cast a doubt in every buyers mind, whether collector or seller and that has the very real possibility of preventing extreme selling of anything like this again. While I'm not saying that’s necessarily a bad thing and certainly prevents surging spikes in the market, it DOES guarantee that the effects will be felt one way or another long term which affects everyone. While it’s a different situation, this can and has been felt in other ways regarding sets that appreciate only to a certain point before dropping as ‘new’ releases are projected to hit the market.

If you step back and really look at the big picture it's just another piece of the puzzle that Lego has figured out on how to mess with the secondary market. First it was re-releasing sets causing older version to fluctuate in pricing, then it was creating sets that were minifig centric thus affecting how minifigs and sets could be broken up for resale, followed by tightening the 10% off coupon restrictions removing the ability to purchase select sets at any kind of a discount, and now it's casting doubt that a limited release may not be so limited. Dare I mention the elusive 41999 Crawler set that has magically appeared at nearly every store nationwide 2 months after selling out resulting in a sudden price drop of nearly $100 online? I'm sure there are other instances that exist but let's be real about this, LEGO doesn't like us whether you call yourself an investor or reseller and they are strategically working to close the holes that have allowed many of us do business the way we do. Some will survive better than others, and like other times of change that usually weeds out the weak and make those who remain that much stronger but either way more changes whether subtle or obvious are sure to be on the way.

In the end just remember the old adage about mice. If you drop a mouse in boiling water it’ll scream, claw, and fight every way it can to get out, but if you put him in warm water and slowly raise the temperature he won’t fight, kick, or scream….he’ll just die. I’m just here to tell you that we are currently in that warm water and they’re only turning up the heat more.

What if anything can we do in response? The most common answer is of course, nothing. I’m sure there are countless resellers out there that either don’t care about my view of things or figure there’s no sense discussing it since they can’t change it anyway and that’s exactly what Lego is counting on. After all you don’t become the largest privately owned toy business without knowing your competition and how to eliminate it, and as I’ve said before make no mistake that YOU ARE THEIR COMPETION. No matter how or what you sell their company policy is that every single person who isn’t an end user is their competition and they are actively working to eliminate you from the retail equation, period.

So where does that leave us and what can we actually do? I have some ideas I’ll outline in my next installment of “The View from 20,000 feet”.