29/03/2016

The Pit (a.k.a. the collector's moment)


To clarify this post's intentionally vague title, let's start with a telling anecdote. Rewind to 1992: the Sega Megadrive is all the rage, and I'm regularly invading my neighbour's house to get my fill of Sonic and Streets of Rage, mourning the fact that my parents refuse to welcome Sega's black beauty in our own home. Fast-forward to 1997: as the Playstation is taking the gaming world by storm, I finally get the opportunity to purchase a Megadrive. Second-hand Megadrives and games are there for the taking for ridiculously low prices, and I indulge in a massive purchasing spree that wouldn't have been possible when the Megadrive was at the top of its game. Fast-forward again to the noughties and further: retrogaming is the new thing and Megadrives cost again as much as brand-new systems, if not more; same goes for the games. Now, see that moment when the prices of Megadrives and games were at their lowest and I could indulge in a giant shopping spree? That, fellow gamers, is what I call The Pit.

I coined that term to describe that elusive moment when a console has lost all its value to regular gamers yet has not yet become a object coveted by collectors and retrogamers. The Pit is characterized by both an overabundance of systems for sale—second-hand or brand-new—and incredibly cheap prices—much cheaper than during the system's heyday. As such, it is the perfect moment to purchase games and systems, because purchasing power is increased tenfold. I put together my whole Nintendo DS and PSP collections during these two consoles' Pits, which took place roughly at the same time and are still ongoing, although they are on their last legs.

Indeed, how long is The Pit? Although I referred to it as an "elusive moment", it can actually last quite long. The Pit always happens at the beginning of a new console generation and its length is directly proportional to the success of the involved system; in other words, the more successful a system is, the longest its Pit will be. The Pit corresponds to the amount of time necessary to sell: a)all the stocks of unsold brand-new consoles and games and b)all unwanted second-hand consoles and games owned by amateur gamers. Once these two sources are depleted, the market for the involved system suddenly dries up and prices skyrocket—hence the image of a pit, stuck between two peaks of high prices. The price rebound marks the moment when collectors that follow the "investor" model come out of the woodwork and offer for ludicrous prices the goods they bought a couple of years before, still brand-new and wrapped. But that's another matter that I won't cover here; instead, let's study the Pits of the DS and the PSP.

The DS Pit is still ongoing with a relative vigour, although it's starting to show signs of weakness. The rarest DS games are already excruciatingly hard to find, second-hand as well as new, complete or cartridge only. For instance, I purchased a couple of weeks ago a second-hand copy of Shepherd's Crossing 2. This game, which Kina of My RPG Blog described as "quite cheap on Amazon" in a 2010 post, is now nearly impossible to find; and when it is, it comes with an insane price tag, such as the $75 of my own copy. Brand-new DSi can still be found quite easily if one is not too picky regarding colours, but good luck with finding a genuine brand-new DS Lite. In other words, whilst the DS' Pit is not over yet, it's very likely closer to its end than to its inception.

The PSP Pit, on the other hand, is well and truly over for the most part. I bought a slew of PSPs in 2013 and 2014 for a average price of $130/EUR 100; nowadays, a mere two years later, a brand-new PSP is more likely to cost around $300, all the more so if it comes in a rare colour, and even the "discount" PSP Street models command high prices. Popular PSP games that were mass-produced can still be found brand-new for a really cheap price, but most PSP games are becoming increasingly harder to find, be they brand-new or second-hand. Hexyz Force, which I bought complete in late 2014 for $60, now comes with a price tag of at least $90 for the full package and $60 for the UMD alone.

The fact that the DS Pit is lasting longer than the PSP Pit blatantly contradicts what common sense would have us believe, i.e. that the less popular system would have the longest Pit. Common sense dictates that if people sniffed at a console during said console's tenure, then surely no one will want to invest in it once it bails out; and yet, the facts show that this is not the case. This leads us to the interesting question of who polishes off unsold inventory and second-hand items during a system's Pit. Although I didn't perform a full statistical study of the matter and certainly won't do so, some purchasing behaviours I've witnessed in myself and others shed light on possible answers. Here are the three main types of potential buyers during Pit periods:

  • Players who missed on the system entirely due to a lack of funds, a lack of time to play, sheer unawareness of the system's existence or any other good reason yet want to discover it and invest in it. These players are likely to buy systems as well as games, sometimes building up full collections for a very decent price. This was my case with the DS: I avoided it during its tenure due to its kiddie image, which made me fear that I wouldn't find any game to my liking. (History has since proven that nothing could be further from the truth, but that's another story.)
  • Players whose console is dying on them yet want to keep playing it, if only occasionally. Those are usually great aficionados of the system who invested in it early on and literally played their console to death, hence the need for a replacement towards the end of the console's lifestyle. These players are more likely to concentrate solely on the console itself, although they may purchase a long-lost game in the process.
  • Players who are also collectors and want to enrich their collection while prices are at their lowest and before the console and its games truly disappears from shelves. These players are also more likely to concentrate on the console itself, scouring Ebay and Amazon in search of juicy bargains. They can buy regular systems with a low price tag that will be used as backups just as willingly as special editions that will become sound investments on the long run. 
My theory is that this core of lingering aficionados is roughly the same size regardless of how popular the involved system is, which explains why an unpopular system is likely to experience a much shorter Pit than a popular system. This fixed core of aficionados will polish off an unpopular system's unsold inventory and unwanted second-hand items pool faster than a popular system's ones, because an unpopular system is automatically less massively produced than a popular system and will thus offer less unsold inventory and second-hand items ready for the taking during the Pit. QED—well, somehow.

The Pit is a pretty fascinating subject, and it becomes even more so when one pores over details. There are a lot of subtleties to be uncovered, such as the fact that a given console's Pit may occur later and/or be longer in some regions than in others, with Japan usually being the last region to experience Pits and retaining stocks of systems and games long after the European and North-American stocks are depleted. The Pit can also affect individual gaming items in a given console generation, generating many parallel Pit trajectories that sometimes don't exactly coincide: a rare game, for instance, may experience its Pit whilst its host console is still soaring and have become a high-priced collector's item by the time said host console hits its own Pit. Last but not least, some gaming items have no Pit at all, experiencing instead a continuous price increase starting from the very day of their release; such are the limited special editions of games and consoles, which are intentionally designed to be rare and see their Pit reduced to nothing because of this planned rarity.

The Pit is one of my favourite game collecting-related subject, and I keep studying it by checking and comparing the prices of games and consoles from last generation on a regular basis. My prognosis for the current console generation is that the 3DS will experience a Pit whose length will be comprised between the DS' and the PSP's—it's already fairly difficult to get one's paws on the first regular 3DS models without forking out a ridiculous amount of cash—whilst the Vita will rush through a lightning-fast Pit and go from legacy console to collector's piece overnight. But apart from being a gripping subject, the Pit is first and foremost a conjuncture in which a console's popularity is at its lowest; a conjuncture that happens to be the best moment to purchase games and consoles. The Pit could as well be called "the collector's moment": it's a blessed time that allows a game collector to complete—or build up from scratch—their collection by preying on gaming items that have become cheap yet are still abundant. Miss that moment by a few years and you'll find yourself paying high prices for crappy second-hand items, just like I did when I decided to invest in the Gameboy Advance. I won't let that happen again, though: I firmly intend to take advantage of the 3DS' Pit to grab myself a couple of backups, and I'll also make the most of whatever Pit the Vita will go through. Thanks for reading, and be my guest anytime!

2 comments:

  1. The Vita Pit has well and truly started. Some regions are completely out of stock of new Vitas, and secondhand prices are fairly high.

    ReplyDelete
    Replies
    1. It has actually become totally impossible to find brand-new Vita consoles and games in my own country, so I totally believe that it's the same in other parts of the world. I've resorted to purchasing Vita games right after their release, just to be sure to get them. I don't even want to imagine how hard it will be to get one's paws on Vita stock once Sony stops the console's production...

      Delete