Jan Gunash

Something we haven’t discussed before is that auctions are an excellent way to determine how much someone is willing to pay. Today, we’re going to explore a case study in the world of collectibles. Collectibles are fascinating because they’re items driven heavily by perceived value, which has significant implications for willingness to pay (WTP) and pricing.

Auctions are straightforward. You set a base amount you’re willing to start the auction at. Some people begin as low as $1 to attract attention and demand for their item, while others choose a starting price closer to the amount they hope to achieve from the sale. You can establish minimum currency increments and specify the duration for which you want the auction to run. To protect yourself, you can set a reserve price (this usually comes with a fee), meaning the auction is deemed null unless the total bid amount exceeds that threshold.

On a popular auction website like eBay, it’s surprisingly difficult to strike a good deal on highly sought-after items. For items with less demand, it’s much easier. This shows that that demand is one of the stronger indicators of WTP.

Check out this article from 2022:

For context, this trading card was from 1999 and has very high demand with a low population (i.e., a low number of cards graded at a perfect 10). Would everyone (if they could*) pay this amount for the card? Absolutely not. However, there are definitely enough people who would drive the card’s price up for this specific item.

So, how do you price cards for sale? You look at recently sold listings. Utilizing eBay’s recently sold values for the same card can provide several data points on what people are currently paying for the card you’re selling. Demand fluctuates, and therefore prices change as well.

Here are some recently sold listings from 2024 for a 151 Charizard EX SIR:

If you own one of these cards and want to understand its current price, you can refer to these numbers. If you’re selling outside of eBay, keep a few things in mind:

• Shipping is generally an added cost.
• Taxes are an added cost.
• Duties (for international sales) are an added cost.
• eBay takes 13-18% of the seller’s profits as a fee.

The good news is that several companies have begun compiling these recently sold amounts to showcase recent prices and trends at a glance.

Here’s a screenshot from PriceCharting:

This aggregated data from eBay’s recently sold listings shows you a monthly trend of how prices have changed. For context, November 2023 was when the set was released, generating high demand and low volume for the cards. The card continued to be printed, and it remains available through the timeline. It still holds decent value, although it’s not easy to obtain, especially in a perfect 10 grade.

So why have I spent the last five minutes discussing Pokémon cards? Because if you’re looking to determine a price for your product, auctions are an excellent way to gauge how much people are willing to pay.

For a product you’re selling, you can further analyze pricing based on features, specifications, or models you’re considering releasing. While auctions may not be viable for everyone, you can continue increasing the price until you encounter a trending resistance from customers. A quick and straightforward method for determining pricing is to base it on competitors; however, unless you’re selling the exact same product, that figure may not be entirely accurate.

Thanks for reading and make sure you subscribe. There may or may not be some more great examples of WTP and sales coming up.