The Psychology of Bidding.......

[Leon]

I was on my way to lunch today and was thinking about the Goudey Ruth I just won in auction. And I was thinking how freaking crazy we collectors are. I called the auction company twice to make sure that the tiniest of white print dots isn't on the card, which shows on his cap in the scan. I was willing to overlook the dark cream, softened corners, but if that needle head sized dot were actually there I probably wouldn't have bid (that high of a price). We are a crazy bunch when it comes to our collecting.... I don't have it in hand but here it is again.....

[MattyC]

Leon,

With centering like that, if you get it and don't like it I will happily work out a deal on it from ya.

Matt

[bobbyw8469]

Nice card Leon....just looks like trash in the scanner to me.

[Republicaninmass]

I'd drive to REA to look at some of the lots!

[CW]

Prior to two years ago, 90% of my card purchases were through eBay, with the other 10% being from private deals. Now that I've been dabbling a bit with online auction houses (eg. REA, Love of the Game), it's been interesting to see the differences in bidding psychology between a fixed time ending format like eBay, and a live auction format like we see from AH sites.

With eBay, it's all about the snipe. You bring your best bid, input it to register a few seconds before ending time, cross your fingers, and pray you win the card (but hope you're not overpaying).

With auction houses and the extended bidding format, I can see how things can get more competitive. Sometimes it's best to place a high bid very early, to occupy that top bidding slot which would force the next bid increment to overpay. Other times it might be better to wait until 4am to get in that last bid while some other poor sucker is drooling on his keyboard because he couldn't stay awake.

The bid increments with auction house auctions also play a big role compared to eBay auctions. The smaller bid increments on eBay allow you to fine tune a bid, sometimes down to the penny. With auction houses, however, once bidding on an item gets up into the higher levels, the larger bid increments can cause an item's price to increase significantly with each bid (plus BP).

With eBay, once an item has ended, that's it -- you either won or lost. But with the auction house format of extended bidding, all it takes is one more bid within that 15 minute time frame, and the item could still be yours. The auction isn't over until you say it's over, and sometimes that can be a dangerous (and costly) thing.

[Leon]

Nice synopsis Chuck. And you are correct of course. When I take a place at my final bid on a card it is where I want to be and I usually won't go over it...unless I know I won't see it again, or for a long time. This Ruth card, at the spot I was at, is about 15%-20% over what nice ones sell for...so I was fine with that as long as that print dot wasn't there . But that was also my last bid increment. With such common cards there is quite a bit of comparative market analysis.....and I was willing to pay a record price (or almost record) for the right card, as we have so often seen on the board. Had this card been on ebay I probably would have been in the same area on it but wouldn't have had the chance to re-bid, regardless of my mindset, as I almost always snipe too. AH's can be dangerous places to collect. And yes, MattyC, I did think about your recent Mick purchase too.... I guess we both have similar views, though mine was on a much smaller scale on this one.

[ls7plus]

Originally Posted by MattyC

Leon,

With centering like that, if you get it and don't like it I will happily work out a deal on it from ya.

Matt

+1. Yeah, it reminds me of the 1935 Diamond Stars "Greenburg" error I purchased from Steve Verkman (excellent seller, by the way) last year--near perfect centering, with slightly whiter borders than Leon's Ruth, and an ink mark on the back that would probably come out if soaked by someone on the board who knows what they are doing. A bit less corner wear than this Goudey Babe. I had previously sold the same Greenberg error version in ExMt several years ago to help pay off some credit cards, and I like the eye appeal of my present one just as well!

Great collecting to all,

Larry

[GregMitch34]

My "psychology" is buying only cards with perfect or at least great centering. In my mind--part true, part fantasy--that makes every card I get at a fair or market price ACTUALLY a nice bargain since I figure (hope) that it's at least 10-20% more valuable than the average price for the card due to centering. This often proves true, which only encourages me...

Wonder if you folks agree...

[MattyC]

Originally Posted by GregMitch34

My "psychology" is buying only cards with perfect or at least great centering. In my mind--part true, part fantasy--that makes every card I get at a fair or market price ACTUALLY a nice bargain since I figure (hope) that it's at least 10-20% more valuable than the average price for the card due to centering. This often proves true, which only encourages me...

Wonder if you folks agree...

Greg, I think you and Leon have nailed it in your posts here. People love to look at the "average" price on VCP, but that is just what it is-- the average. It is not at all what the very best card in its grade will go for.

I think far too many collectors get hung up on "overpaying" based on the "average," as if that average is the real market price. And that is a gross misinterpretation of what that VCP average really is. Staring at that average and fear of overpaying will only lead one to miss out on and lose the very elite cards for any given grade.

If one really wants a card that blows away others in its grade, and even those with bigger sticker numbers, one has to be prepared to pay a premium over the VCP average. If I know how rare a card is to find centered or without some usual endemic flaw, and I see that rare, standout example, then I want it. And I will pay what it takes to get it in my collection. I never, ever see this as overpaying. Not when the alternative is losing out on the top specimen for the grade, or paying a bit less hard-earned money for an inferior example, when I will forever know very well that there's a better one out there. To me, overpaying is actually paying any amount for a lesser card, just to save a couple bucks.

And the proof is in the happiness. I would bet the farm that when it comes to cards like the ones you mention, and the Ruth in this thread is a prime example, there is far more underbidder's remorse than winner's remorse.

But of course the philosophy you mention only makes sense when one does not view all cards in the same grade as identical. There is a real danger in getting hung up on wanting 'Grade X,' as much as there is in getting hung up on the VCP average. That danger can lead to one buying downright ugly cards that, in the future, will never perform or appreciate the way the best looking ones in the grade will.

Leon's Ruth in the initial post here is just such an elite example for the grade. Should he ever want to sell it, he will be able to find many more buyers for this example that has elite centering, as compared to had he paid closer to the VCP average for an ugly example. And I'd bet the proverbial farm that his 4 will appreciate at a greater rate than the usual looking 4.

[GregMitch34]

Good comment. I NEVER consider VCP average--I will look at all sales listed to see fluctuation, and latest, and follow links to see photos if provided. Same at Card Target, which has photos of EVERY card, even the backs, so it's easy to see why prices were higher or lower for each example. That way you can usually see the "premium" your card deserves (and has often gotten). As I wrote, sometimes it's only a small amount--but still very real. And enough to get me to take the plunge on a card I might normally pull back from.

[glchen]

Originally Posted by MattyC

...
Leon's Ruth in the initial post here is just such an elite example for the grade. Should he ever want to sell it, he will be able to find many more buyers for this example that has elite centering, as compared to had he paid closer to the VCP average for an ugly example. And I'd bet the proverbial farm that his 4 will appreciate at a greater rate than the usual looking 4.

Hi Matt, I don't know if I fully agree with this at least for cards in grade 4. (Great card, btw, Leon!) Leon's 4 will probably appreciate at a greater rate than a typical 4, but I doubt that it would generally surpass the grade of a typical 5. So there will still be band that it will be locked into. Cards graded Authentic or Poor, are very different, on the other hand, like your M101-5 Ruth. There can be a huge difference in eye appeal among these cards, as cards can have NM visual appeal, but just have a pinhole or slight back damage that drops the cards technical grade to Authentic or Poor. These cards can appreciate far faster than cards graded multiple levels above it.

[mrvster]

I could see where that "dot" would be a distraction, but a beauty of a card
especially when condition will outweigh any rarity....
I have the 181 classic pose....in good cond.....

CONGRATS!

Chuck, you just explained that perfectly

[I Only Smoke 4 the Cards]

My approach is to put in my highest bid and walk away. If I win great and if not then oh well.

I have never set a snipe. How does it work?

[Leon]

Originally Posted by I Only Smoke 4 the Cards

My approach is to put in my highest bid and walk away. If I win great and if not then oh well.

I have never set a snipe. How does it work?

You place an early, automatic, private bid that will bid for you within seconds of the auction ending. Basically it's your approach, you bid early and forget about it .....

[brian1961]

Leon,

I'm right with you on the white dot on Babe's hat. When I look at a card, the first thing I hone in on is the player's head area. That dot would upset me. You're not crazy. A print spot as glaring as that throws up a colossal red flag.

It is interesting to note what auction houses and eBay vendors will sincerely answer questions to dissuade concerns from a potential customer, and which act as if they cannot be bothered.

Hope all things turn out well for you. ---Brian Powell

[conor912]

Originally Posted by Leon

I was on my way to lunch today and was thinking about the Goudey Ruth I just won in auction. And I was thinking how freaking crazy we collectors are. I called the auction company twice to make sure that the tiniest of white print dots isn't on the card, which shows on his cap in the scan. I was willing to overlook the dark cream, softened corners, but if that needle head sized dot were actually there I probably wouldn't have bid (that high of a price). We are a crazy bunch when it comes to our collecting.... I don't have it in hand but here it is again.....

Nice card. I was the underbidder to complete my set. Glad it went to a board member. Enjoy.

[Leon]

Originally Posted by conor912

Nice card. I was the underbidder to complete my set. Glad it went to a board member. Enjoy.

Ugh, sorry 'bout that. Ya' almost never know when you are bidding, who you are bidding against.

[conor912]

Originally Posted by Leon

Ugh, sorry 'bout that. Ya' almost never know when you are bidding, who you are bidding against.

It happens....nature of the game. I went back and forth on that next bid for days. I'll be kicking myself for a while on that one.

[Stonepony]

Any thoughts on bidding incements in the larger auctions? Specifically the 10% increment rule. I wonder at times if this hurts the consignor and final gavel price. For instance in Goodwins last auction an item went to "X" amount and closed there. I was willing to up the bid a couple hundred dollars but the 10% required increment ( plus the 20% buyers premium) was more than I wanted to go. If I had been allowed to up the bid at a lower increment its possible the eventual buyer would have outbid me again. Either way- consignor and aution house lost out on $ because 10% was too big a jump for me personally. Is there data showing that higher increments of bidding = higher gavel prices?

[CW]

Originally Posted by Stonepony

Any thoughts on bidding incements in the larger auctions? Specifically the 10% increment rule. I wonder at times if this hurts the consignor and final gavel price. For instance in Goodwins last auction an item went to "X" amount and closed there. I was willing to up the bid a couple hundred dollars but the 10% required increment ( plus the 20% buyers premium) was more than I wanted to go. If I had been allowed to up the bid at a lower increment its possible the eventual buyer would have outbid me again. Either way- consignor and aution house lost out on $ because 10% was too big a jump for me personally. Is there data showing that higher increments of bidding = higher gavel prices?

I see exactly what you're saying, and I've experienced the same thing (ie. not bidding again because it's such a large jump). I'd imagine that the AHs have found this is the model that yields the best closing prices overall, which is why they all use it.

Sure, you are not willing to go one bid higher, but it's the same bidding system that already got the item's price to such a high level, so it already worked successfully for the AH (and consignor) to some extent.

You can also, as a bidder, use it to your advantage by figuring out that threshold of "how much is too much" for a card, and then placing a bid very early in the auction to occupy that bidding increment. Of course, this does not account for ego, which is why some items sell for insane prices.

Oh yeah, and before i forget... nice Ruth, Leon!

[Runscott]

Originally Posted by Leon

I was on my way to lunch today and was thinking about the Goudey Ruth I just won in auction. And I was thinking how freaking crazy we collectors are. I called the auction company twice to make sure that the tiniest of white print dots isn't on the card, which shows on his cap in the scan. I was willing to overlook the dark cream, softened corners, but if that needle head sized dot were actually there I probably wouldn't have bid (that high of a price). We are a crazy bunch when it comes to our collecting.... I don't have it in hand but here it is again.....

Leon, you are smart to ask about those mysterious 'dots'. Several years ago I won a NM T206 Matty through an auction house - it had one of those white dots on it, which you and I discussed the next day after the auction ended (it turned out there were 2-3 NM T206's with dots of paper loss). I was discussing the card with another hobby friend, via email that night, and he told me he had called the auction house and they confirmed that the white dot was paper loss. I panicked, as I had won the Matty, but I called the auction house and they immediately removed it from my invoice. It sure sucked, as I got it for about 75% of its value, but I guess that was because I was the only one who did not ask.

Now I always ask.