Does buying silver online mean the end of the coin shop?
How to buy silver online is hardly a no-brainer. There has practically been a rush (pardon the pun) to buy silver online as silver garners a lot of attention in the press and has for the past decade. This spike in interest has taken place during the rise of -e-commerce, and the silver market has not shied away therefrom. However, in 2002-2003 many of those who bought silver, did not buy silver online. They bought silver differently. Is this way of silver procurement going the way of the dinosaur?
At the beginning of the silver bull market, the internet was not as prevalent. That means people were going into local coin shops and buying silver. This worked fine for the silverbug. But, over time, the interest in silver has increased, and this can be seen online at Google Trends via the search term “silver bullion.”
With these peaks and valleys seen in silver bullion online interest, one can imagine that, especially at the peaks, people are getting to their computers and searching “buy silver online” or some derivative and finding online silver retailers before finding those good ole’ local coin shops. Of course, many people probably choose to solely deal with local coin shops. But, overall, newcomers to the bullion market these days are entering into a market that, while once depending on coin shops, today depends on buying silver online at the retail level.
So, will “buy silver online” put bric-and-mortars (“coin shop”) out of business? It is clear by the above graph that silver demand has not spiked and remained over the last ten years, if Google Trends is to be trusted. Instead, what we see since 2004 is a constant dance between quiet periods of interest and mania when it comes to searches for “silver bullion” online.
This, in my opinion, would be a more ideal environment for those running e-commerce shops, as not only do bric-and-mortar shops have to time the market day-to-day when buying stock, but they also have to time when they buy employees, expand and so on.
Many people argue that soon bric-and-mortar will be anachronism, but to buy silver online is not always as easy as buying a pair of socks. One has to worry about the often immense value associated with silver bought online and the shipment thereof. Many, many people simply wish to avoid this.
Also, when selling, people do not want to send their silver through the mail. This is too much of a hassle. So, many individuals, even though they buy silver online, will want to use a bric-and-mortar location as it is more private and straightforward.
Moreover, coin shops have an added benefit: they get to charge a little bit more premium. It’s true. In many cases, it doesn’t matter where you buy silver online. All that matters is if it is cost-effective and from a reputable dealer. You will do what you can to find this dealer, using various tools on the Internet, all from the comforts of your own home. When you’re in your local coin shop; well, you’re already there…
And interestingly enough, interest in “coin shop” is hardly waning, especially compared to “buy silver online.”
Compared to general interest in “silver bullion,” interest in “coin shop” has skyrocketed. But, “buy silver online” certainly mirrors the “coin shop” chart more than the “silver bullion” chart.
At the end of the day, it does not appear like buy silver online means an end to the local coin shop. Both will continue to serve their purpose. Buying silver online might mean lower premiums while buying, but local coin shops serve a definite purpose.