Changes in the Coin Auction Market

Has any segment of numismatics changed more in the past ten years than auctions? A hypothetical collector who pulled a ten-year Rip Van Winkle and suddenly rediscovered coin auctions would note a host of differences including the following: The Internet now plays a huge role in auctions. Ten years ago, the Internet was a non-entity when it came to coin auctions. In today’s auction world, a large percentage of the lots are sold online; often times to collectors who have never seen the coins in person and are relying solely on the images.

Many auctions now play out in nearly empty rooms. Ten years it was not uncommon to see a hundred people bidding live in an auction room. Today, many big buyers never set foot in a live auction.

The numbers and dollar values of coins sold at auction have grown astronomically. Ten years ago a $10 million auction was front-page-of-Coin World-news. Today, it’s nothing. In fact, for many of the big firms a $10 million dollar sale would be a disappointment. And the physical sizes of the sales themselves have grown immensely. For certain firms, a 5000+ lot auction is routine. Ten years ago, auctions were seldom more than 2500 lots. And let’s not even mention the size of the catalogs themselves. You could use many of today’s catalogs for weight training devices…

The catalogs have become better and more sophisticated. The average auction catalog in 2006 is much slicker and glossier than it was in 1996. Most of the descriptions have gotten better and the photography has, for the most part, improved. In 2006, most coin auction catalogs compare favorably to the catalogs produced by Sotheby’s and Christie’s for their major art sales.

The players in the coin auction business in 2006 are remarkably similar to who they were in 1996. But the power structure has changed radically. Heritage has gone from an also-ran to the dominant force in the business while Superior and Bowers & Merena have become far less significant. Stack’s has kept its business model fairly consistent and has lost business as a result. The new kid on the block, ANR, has basically become what Bowers & Merena was ten years ago.

The entire numismatic auction business has become more transparent and information-driven. Heritage posts the reserves for every coin it sells and has a prices realized archive with over 1 million lots included. It is only a matter of time before other firms become more transparent and it seems likely that someone will take the Heritage archive and enlarge it to include other firms’ lots. In 1996, coin auctions were about as un-transparent as you could imagine and it was not uncommon to see consignors bidding on their own coins at auctions in an effort to drive up prices.

While the entire coin market is a very different animal today than it was a decade ago, it seems that more of these changes are noticeable in the auction arena than anywhere else. It will be very interesting to see how different the landscape looks in 2016.