This is Part II of our coverage of the Pipe Collecting on eBay Seminar from The Chicago Pipe Show.
Part II is the question and answer session from Rob Cooper’s presentation. This is a lively discussion about buying and selling collectible pipes on ebay, customer service, and debate about the auction format and sniping services.
The discussion starts out specific to collectible pipes, and then relates to several general things that would apply to anybody buying and selling on ebay. Just as with the part I, I thought it was an interesting and educational discussion even though I do not personally participate in these activities. The way the business works, the challenges involved for both buyers and sellers, and how Rob has been successful with it are an fascinating story. I imagine it will be even more captivating if you are involved in buying and selling online.
Without further adieu, here is the Q & A from the Pipe Collecting on eBay Seminar from the The 2009 Chicagoland Int’l Pipe & Tobacciana Show
Rob: I see Cavicci and Becker, and Costello, is big and strong. The Caminetto, the Escorti, the Radice, no. I think that part of that ties into those that are buying pipes today have the money to but pipes today and, when I’m talking those brands, that’s the lower end of the Italian market. Now, conversely, some of the pipe makers I’ve talked to, what seems to be their best sellers are the sandblasted Terrell, or Rusticated right now. Because they don’t want to… the guys don’t want to spring for the smooth pipes. But I can tell you, the average selling price of a high grade pipe is $325 today. Okay? And if one goes over that, I’m talking to the collectors, it becomes a different animal. The market does go down.
Something else you may not be aware of, and again, I’m aware of on the front line is what you see at a show like the Chicago pipe show, a big well-attended show, is the tip of the iceberg of what’s out there in pipe collectors. I believe by nature, when you come down to a show those are people not only with a strong interest, but also of a more outgoing personality. Many pipe smokers and collectors tend to be introverted. And can I talk to these guys and, why don’t you come to Chicago, … ‘No, its okay, its okay,’ I’ll just…. you’re smiling, I don’t know if you can relate to that. There’s a lot of guys out there like that. And what you really see here is that more or less the same faces every year. We’re the outgoing bunch, we know what fun it is to come to a show and exchange pleasantries, talk about all sorts of things with one another and just enjoy the camaraderie of each other. But we’re a very small percentage of what’s out there in collecting pipes.
Audience Participant: In the beginning, you said that you’re store was up 30% in the last two…
Rob: Yes. In the last year.
: … last year. Do you think that’s because of a different demographics, or do you know what…
Rob: No, the demographics are identical. I have the same customers. It’s coming from a two-fold… I’ve been fortunate, maybe because of these times and the guys are changing the focus of their collections. They’re not getting out, and they’re not… some of the same guys that I’m selling for turn around and buy right back from me, but different things. And it’s a way that… when things are a little tougher, they can justify it to their wife. Hey, I’m…
Audience Member: I got rid of this, and I got this.
Rob: Right. So, what I found is that a good part of that is the number of listings that I’m doing every week has increased. But in increasing those listing, the price per item has not gone down.
Audience Participant: I own a store in San Francisco, and I worked there for seven years, and I’ve owned it for five. But when I started there, it took me a long time to get into the pipe side. And that’s probably because different demographics, and a lot… I just thought it was a lot of older gentlemen. Now, in the last year and a-half, two years, it’s been whole different customer base.
Rob: I don’t know what price range you … you know, I’m not quite attracting that customer base. In other words, the younger guy, the college student, these are the guys that are absolutely tapped out. I don’t want them. It’s not that I don’t want them, it’s… I’m not going to cater to them. I’m not going to have lower priced pieces to attract them. Let somebody else do that and then they’ll migrate to me if they stick with it. The problem is if you look at the demographics of those 30 and younger today, they have nothing. And they will have nothing for the foreseeable future. It’s not something I would aggressively pursue. That’s all. Yes.
Audience Participant: I have a question, and a comment. First, the question is; are some of the Carvers using you as a method to move merchandise and advertise at the same time?
Rob: Thank you.
Audience Member: But I come because you have some of the best pipes. You send them to me clean, they’re ready to smoke, they’re in excellent condition, and I’m a repeat buyer. And I see others being the same way because you have a good product, you treat us right.
Rob: You support my family.
Audience Member: You give us a commission.
Rob: No, no, no, but you support my family. Don’t you understand, and that’s how I view it. It’s not just I’m selling a pipe, getting cash and run. You’re supporting my family. And in doing that, you’re everything to me. That’s, you know, and I can only show that by getting the stuff out right away, nice pack, clean, communicate… you understand. I want you to come back.
Audience Member: But that has, you know, multiplied the people coming back to your site.
Rob: Oh, there’s not doubt.
Audience Member: And that to me is probably what the increase is. Is you’re getting more and more of your share of the customers.
Rob: I agree with that. Thank you.
Audience Participant: I’m in the same position as he is. I’m a repeat customer of yours, but I think the reason I go to your site is because of the quality of the pictures the angle of the shot of what I’m looking at, and the honest description. I bought a pipe and you said that it had flaws and you showed it in the picture, a couple of sand pits in the front, or whatever you want to call them, and you know what? When I opened the box, there they were, exactly, because other sites that I’ve gone to, and then I… their descriptions are terrible. They don’t know what they are talking about. And it’s… yeah, its…
Rob: I have to tell you what my pet peeve is in life.
Audience Member: Okay.
Rob: Is having my time wasted. It’s the most precious thing I have. I don’t want to waste anybody’s time, including my own if it’s coming back to me with an issue.
Audience Member: Correct.
Audience Member: Right, exactly, you don’t care.
Rob: I don’t care. That time is worth more than the $30 to me. And to my customer. So, I’d rather point it out. Now, I’m not infallible, now, with the volume that I do. I’m gonna miss something now and again, but it’s not intentional.
Audience Member: Well, no.
Rob: Yeah, it’s not intentional, so, if somebody ever gets something and there’s an issue, I’m gonna take care of it. I don’t advertise that though. The feedbacks speaks for itself. It’s taken care of. I’ve had to take care of burn outs, that’s too small, it’s too big, it’s too heavy, it’s too whatever. Whatever it is. It doesn’t matter. And as my wife has said to me, "Rob for the amount of time you put into cleaning that pipe and photographing it and everything and then to have it go into someone’s hands that doesn’t like what they have, they shouldn’t have it. The right person should have it." So, I just run it like that.
Audience Member: Yeah. Thank you.
Audience Participant: When you said $325 for the high-end…
Rob: No, that’s just average high-grade selling price.
Audience Participant: And that’s a brand new pipe?
Rob: No, that gets everything.
Audience Member: That’s everything.
Rob: Yeah. Let me ask you something.
Audience Member: Okay.
Rob: When you are adding a pipe to your collection, does it matter to you… call it, it’s a two-tier… does it matter to you if it’s new or if it’s an estate, more so is it the pipe that you want.
Audience Member: Correct. It’s the pipe that I want.
Rob: Okay. And $325 seems to be the magic number of the pipe that you want. That’s…
Audience Member: Well, that’s good, should I have went to $326?
Rob: Yeah, look at me, I’m giving…
Audience Participant: You know what’s gonna happen…
Rob: I getting in the middle of a ****. That doesn’t necessarily mean that. But that’s. Are three any other?
Audience Participant: So, Rob, Tony’s not here, do you think e-Bay’s in auction?
Rob: And here’s something else that I don’t talk about, but I’ll brag for a minute. E-Bay has me as one of their top 200 sellers on the site for the globe. Now, the things that go into that matrix are not dollar sales, I can’t compete with the guy selling expensive real estate or Ferrari’s on the there, so it’s not by dollar volume. But what they are looking at, because I asked them this, what are… is a consistency every week of a dollar volume. But then they want to see what people are saying, particularly those with low feedback that are new to the site, and the guys who’s feedback are under ten. What are they saying? Combined with the number of repeat buyers that I have, combined with, it’s something you don’t get to see, I get to see on my end, is the number of people who are watching my auctions every week. And they are amazingly strong numbers. Being a power seller, in that status, I have met with their old CEO, I’ve net with their new CEO, their current Chief Financial Officer, the President of PayPal, I’ve talked to these people. They know me and I know them. The problem with e-Bay right now, and I just had a conversation with someone there this past week, versus Amazon. Amazon is an easy shopping experience. When I want something, I don’t think to go to e-bay to buy it. I’m just talking commodity item. I need some reading glasses; I want to get five pair of reading glasses to lay around the house. I go to Amazon… the problem with e-Bay, they have an auction format, and they have the ‘Buy it Now’ format, the have the auction with reserve…
Audience Participant: They have stores.
Rob: They have stores. And the bigger problem is they have amateurs selling right next to professionals. Okay? And that’s got to be clarified, it has to be when somebody goes to the e-Bay site, by search engine, you want to look just look at power sellers. Or you just want to look at amateurs, or you want to look at everything, but let the consumer make the experience easier. I know that my sales have been hurt by somebody buying a pipe out there their first experience on e-Bay by some amateur that they had an issue with and, "Hey, I have my money, you have your pipe, good riddance." Now they’ll never come back to the site. And I have a problem with that. But are they getting rid of the auction format? No. Oh, no. no. no.
Audience Participant: Oh, no no, no. I said, what’s the question. There’s been some discussion in the **** Newsletter about e-Bay as either an auction or a store front.
Audience Participant: Store… contract.
Rob: Right. See they’re right. And I can tell you, they are not going to change that.
Audience Participant: It’s probably irrelevant anyway. And I do have another question.
Audience Member: What’s your thought about the sniping services and the relationship with e-Bay… I assume that e-Bay gets paid to provide the data. From a seller’s point of view it seems to me that it hurts all of us, from a buy’s point of view, it’s great. I think e-Bay has probably made the calculation that they get more money from the sniping services than they would an additional final value fees from…
Rob: I like it. I don’t mind the sniping, I like that it ends at a certain time, it doesn’t go beyond that time. I like the finality. I want to move on to the next one.
Audience Member: But in terms of… five years ago, and you may be an exception, you have always had strong early bidding, and undoubtedly because of a lot of loyal customers…
Rob: No, not always…
Audience Member: … but, there are a lot of people who will put up a pipe, the same pipe as you put up, say it’s an apples and apples deal. It will get a few early bids and sit there doing nothing until the last two days and then here comes the snipe. And you know, what the snipe does is it keeps you as a bidder from bidding against yourself. You don’t want to artificially pump up the price of the item. I think it hurts sellers, e-Bay may be better off for it economically, but I think it hurts sellers.
Rob: I can’t answer that. I know I command strong prices for mine, however the bids come in and however they come, I don’t care.
Audience Member: I know. I agree with you.
Rob: And I like them… and to go on to the next one because I’m too busy. The other thing you don’t know is I run my business on stochastic formula. And I’m not selling 30 individual items or 35 individual items in a given week. I’m selling a wave of goods. However those numbers come in, I don’t care, but they’ll always come in within a couple percent of what I knew they would come in before they are even listed. But that’s from years of doing it and analyzing the numbers.
Audience Participant: I was just going to say to your comment about snipers. I get ticked off as a buyer if he comes in and get it, but as a friend reminded me, on e-Bay, put in the amount the first time what you want to pay for that …
Rob: Not so.
Audience Member: … item, and leave it alone. If you get it, you get it. If you don’t get it, you’re ****…
Audience Participant: I understand and that’s what you should do if you’re using a sniping service too. My only comment is though is that it tends to discourage active bidding by the people who are using the snipe. And the effect of that is that it keeps the price artificially low through most of the auction. And it’s always puzzled me why e-Bay…
Audience Participant: Would encourage that.
Audience Participant: … would encourage it, and it’s got to be an economic decision.
Rob: As a seller, what I do, I really don’t care because the final price comes in as a group of goods, exactly where they should be.
Audience Participant: Right.
Rob: Exactly where they should be.
Audience Participant: I think you’re in a unique situation.
Rob: I am. I am. But it’s taken me ten years…
Audience Participant: Of pure knowledge…
Rob: Oh no, of doing it for ten years.
Audience Participant; Yeah, that’s right. Use your knowledge, and listening, and reviewing, and searching it out and ….
Audience Participant: Good point, yeah.
Rob: That’s all. You know, is like I do my auctions with like 1 cent, no reserve, which may go against everything Tony Sauderman has said in his auction… its okay. I don’t recommend, you know, if somebody’s going and selling on that site, they better put a reserve on, or they’ll get their lunch handed to them.
Audience Participant: But reserves do discourage bidding. No question about it.
Rob: Oh sure.
Audience Participant: For someone who’s in it, you’ve got your format and it works for you and your regularly selling, and you put x number of auctions up a week, and so the way you do it without… but for someone who’s an occasional seller, like I’ll put a few pipes up every so often, do you recommend following that format for someone who is just doing it as just a once in a while on the side to move a few pipes out. What would you recommend?
Rob: When I started doing it, I initially put reserves on things. And I did that for about six months. After that, I said, you know, what am I protecting, it’s a pipe? How much am I going to lose if I take that off? I want the bidding action. I want to draw the attention. And I found pretty early on that was more effective in getting more guys bidding and more interest, but again, I’m approaching it, I’m not selling a couple of pipes. Now, the other thing that I’ll say, and I’ll be emphatic about this and then go back to what I said earlier, we all hand on to hope and we don’t face that market that it is today, and our egos are bruised if we bought that pipe for $325, and now the market for that pipe has been taken down a condition or two, it’s a little dirty, it’s whatever, that market is now $200. No, if I paid $325, and if I don’t get at least $275 for it, I’d just as soon keep it, that’s holding on to hope rather than facing the realty. I think another way that you could do this is to have a starting price that may not be a penny, but a starting price that’s the least that you are willing to accept for the sale of that pipe.
Audience Participant: That’s what I have done on a few times. I was much more satisfied.
Rob: You know, and I don’t do all of my auctions at a penny. You know, to give an example. I’ve switched that to some extreme ultra-high grade multi-thousand dollar pipes. I have a Lon Jameson I listed last night, and it was smoked one time. I’m not starting that at a penny, but I started it at what I thought was a fair price that’s number market for what it is, and it’s under the market by about $1,000 over what it should be, so, it will still attract bidding interest and attention. You know, if I’ve went and I’ll pick on the **** and listen to for $5,000, yeah, you’re going to get a lot of people looking and I’m not in the business of showing pipes.
Audience Participant: Rob, what’s is… for you, is there a difference between putting a starting price, or putting a reserve on something?
Rob: Don’t do reserves.
Audience Member: You just put a, whatever starting price you think is fair on to start…
Rob: 99.99% of the time, I start at a penny. That’s a fair starting place.
Audience Member: How do you make that decision to whether you’re going to start at a penny or to put a starting…?
Rob: It’s real easy, if Lars Ivarsson made the pipe, or Bo Nordh made the pipe, that’s going to change it. That’s about it. Because everything else out there is commodity.
Audience Participant: For years, I didn’t know much about the high grades, but I saw…
Rob: No. no. ****, that’s all right.
Audience Participant: I saw what was going on with your auctions, and I said, I trust this guy because he’s got the balls to put it up for a penny because he knows it’s gonna sell. And I watched and I learned.
Audience Participant: Well some of that is also self-confidence in …
Rob: **** my market.
Audience Member: Yeah, but it showed confidence to me as a potential purchaser that this guy is confident in what he is doing. Made a difference. The fellow… even though I never met you.
Rob: But it’s a confidence that I also have in my collective customer base. I’m confident that they know the fair value.
Audience Participant: Yeah. Earmarked for a favorite seller maybe. You know. And if I’m going to sell like one pipe a year, nobody has my name down and I take it in the pocketbook when I sell my pipe unless I maybe send it to you. Maybe that’s what I should do.
Rob: That’s the most… I tell you, a lot of guys do that anymore because they find… I’m not doing it to advertise my consignments service, but what they find is, net of my fees, they can do as well or better than doing it themselves, and I stand behind what I’ll sell. So, you know, you don’t have that hassle. But that’s far and few in between that there are problems with pipes. One in a hundred ****. If there isn’t a problem, one in a hundreds, I wonder what I’m doing wrong and who’s unhappy, and I don’t like that. You know, I’d rather deal with something then I know we’re on track putting number back again. Any other? Yes.
Audience Participant: You said earlier, like the Dunhills, you’ve seen interest in the …
Audience Participant: And I think last year at your talk here, and even in the year before, if I’m not mistaken you said, no, it was more of the individual Carvers versus the…
Rob: The individual Carvers, other than Germany, and I’m not Germany broad across, I’m gonna … Joura and Barbie, the individual Danish Carvers, oh, that’s still strong. I can’t get enough of them.
Audience Member: But, you’ve seen them increase.
Rob: But Dunhill has increased. Now, keep this in mind, for me to see an increase. This is not a big wide street we walk on. You can have two guys out there in the world with some money in their pocket that decide that I am not collecting Dunhill patents. And they’re on a mission to add 50 Dunhill Pattons to their collection. Okay, so, I’m just, again, going by my, and that is way I wanted to **** that ****. But I know that’s one of the reasons behind a pick up in Costellos. There’s a couple of new guys out there who love Costellos, so I’m seeing a pick up. You had a question.
Audience Participant: Do you know a percentage, or approximately like what percentage you sell out of the country and is that going up or down over the last….
Rob: No. I can tell you that, 50%, in any given week, 60% can go out of the country, 20% can go out of the country. It becomes a real function of the value of the dollar that week. And the countries that I am noticing a strong presence and that’s Italy, China, Taiwan, Japan.
Audience Participant: Do you have trouble sending them to Italy, any problems with the postal service.
Audience Participant: yeah, they’re being nasty.
Audience Participant: **** except sometimes it take them so long.
Rob: Sometimes it takes longer, it can take a month, two months. If you want to avoid that, sent it Express Mail.
Audience Participant: Or registered.
Rob: No. Registered is a worthless service. Believe me when I tell you that. There’s no tracking number with Registered. There’s a Registration number.
Audience Participant: I understand that.
Rob: Let me go on to something. If something doesn’t arrive. That seller has the right to call PayPal and say, Didn’t Arrive. You as the seller has to prove you shipped it. A Registration number is not a tracking number, there is no proof of shipment.
Audience Participant: What about International Priority.
Rob: Don’t make a face. I’ve been through this.
Audience Participant: Registered mail is no proof of shipment.
Audience Participant: It’s tracked but it’s out of the United States.
Rob: It is not. It is traced, and there’s a difference.
Audience Participant: Yeah. He’s right.
Audience Participant: What’s… What’s…. What’s tracking, I, I’m…
Rob: Traced means, if its lost internally at the Postal Service they can look and investigate and after you know 90 days, say, ‘No.’…
The Q & A and lively discussion continued, but we will end our coverage of it here. So you don’t miss anything next time, be sure to attend next year’s 2009 Chicagoland Int’l Pipe & Tobacciana Show.