The Coin Analyst: Perth Mint’s Launch of Poseidon Coin Frustrates Buyers
By Louis Golino for CoinWeek
Once again a limited-edition, high-demand modern coins’ release resulted in web site problems and frustration for many buyers, which then produced a chorus of criticism aimed at the issuing Mint that was accused of catering too much to dealers. But this was not a U.S. Mint release of a hot new coin or set. Instead, it was the Perth Mint (www.perthmint.com.au) launch of the second coin in its three-coin Gods of Olympus series that honors Poseidon, the God the Sea. This series is shaping up to be perhaps the hottest world coin series of 2014.
On June 2 at 12:01 EST Perth was scheduled to release the Poseidon coins on its web site. The coin was also available from major retail distributors of Perth coins like Downies and Talisman as well as other dealers on e-Bay and elsewhere. The coins are made of two ounces of silver with an antique finish, are struck in high relief, and depict the Greek God in an unusual and very stylized rendering that people either love or hate. They also lack a rim, and for that reason do not come in capsules, and are instead packaged in an elaborate round wooden box with a felt insert for the coin.
A lot of people clearly loved the first coin for Zeus, especially after it sold out in minutes at Perth, and then quickly rose in price on the secondary market. In the span of about a week the coin jumped from an issue price of around $150 to $400. Dealers took note of this strong performance and undoubtedly did what they could to enjoy some of that instant wealth creation next time. The weekend before the launch of Poseidon one major U.S. dealer had already listed the coin for sale at close to $400 and posted an image of the coin. Perth has an embargo on the release of coin designs prior to their official release, but in this case the design had already been leaked a few days earlier.
In addition, days before the release of Poseidon, Perth announced that buyers would be limited to one coin per household in an effort to allow more people to have a chance at getting a coin.
Given the global interest in these coins and the extremely limited mintage plus the quick tripling in price of the Zeus coin, I personally considered it unlikely I would be able to get a coin from Perth, and it seemed foolish to bank of that, but of course it was worth a shot. So like hundreds of other buyers I logged on at the appointed time, and then noticed the coin was not yet listed for sale, which continued for a good 15 minutes. Once it was there, I tried to put in my cart, only to keep receiving error messages that kicked me out of the web site. This continued for an hour, as I tried on two different computers, and at this point I knew the coins had to be long gone. I tried a few minutes later and did manage to put a coin in my cart, but then I got stuck in the ordering queue, which started off at 160 minutes, though it took far less actual time. But at the end of the process I was informed that the coin was no longer available. Big surprise I thought.
On June 3 Perth released a statement on its official blog, “Issues relating to Poseidon 2 oz silver coin.” The statement explained that prior to the launch over 450 buyers were logged on, and that only 300 coins were made available at that time, and apologized for the computer problems buyers encountered. It also sought to address claims by buyers that dealers were given preferential treatment and complaints about the prices charged by third-party dealers, saying that: “In fact, each dealer received only a tiny allocation which was correlated to the number of preceding Zeus coins they took. On the question of dealer pricing, unfortunately there is very little we can do. As discussed previously on our blogs, we are unable to ‘fix’ the price at which third parties sell our coins under Australian consumer law.”
The statement failed to assuage most buyers, who found it strange both that only one-fifth the mintage would be offered during the launch and that such a small number of users could crash the system for about an hour. It should be noted that a second, unknown but likely smaller number of coins was made available at 8:30pm EST the day of the release. This is what Perth usually does to allow Australian buyers an opportunity to buy the coins, especially since hot new releases tend to be scooped up by American and European buyers very quickly at 12:00pm. Australia is 12 hours ahead of the U.S. East coast.
It is clear based on this experience that Perth does need to increase its server capacity substantially, and hopefully things will be better in time for the release of the third coin for Hades. I also think an increase in the mintage even of 500 coins might help. The 1500 mintage is undoubtedly part of the appeal of these coins, but given widespread interest in this series, a higher mintage and the release of more coins directly by Perth would be preferable. 2,000 would still be a very low number.
But at the end of the day, if someone really wanted to get a coin, it made sense to have a strategy that involved more than rolling the dice on getting it from Perth. Most collectors of Perth Mint coins know that there are several U.S. and Australian companies that sell the Mint’s coins, generally at the same or close to issue price. In this case one U.S. dealer did mark the Poseidon up about 65% initially and then 100% a couple hours later, which was still better than the dealer who priced the coin at 200% over issue price in advance of the release. As Perth stated, it is not in a position to control dealer prices, though as I have said before, some European mints do take steps to try to limit speculation in their coins and to ensure a wider allocation.
The smaller Australian dealers received very small allocations that went extremely fast. But there is another, larger Australian company that always carries these coins and one well-known U.S. dealer that often reward the loyalty of buyers who purchase the preceding coins in a series. In this case preference was given to buyers of the Zeus coin to purchase the Poseidon issue.
The moral of this story is that there are always going to be frustrating web site problems when a lot of people want something that is limited in number and high in demand, so have a back-up plan. Contact a couple dealers before the release, and try to get on a waiting list, which is what I did, and it actually worked. Being proactive is better than stewing in sour grapes, or being forced to pay a highly marked-up price later.
Copyright © CoinWeek – June 2014
Louis Golino is a coin collector and numismatic writer, whose articles on coins have appeared in Coin World, Numismatic News, and a number of different coin web sites. His insightful retrospective on the American Silver Eagle was the cover feature of the February 2014 issue of The Numismatist. His column for CoinWeek, “The Coin Analyst,” covers U.S. and world coins and precious metals. He collects U.S. and European coins and is a member of the ANA, PCGS, NGC, and CAC. He has also worked for the U.S. Library of Congress and has been a syndicated columnist and news analyst on international affairs for a wide variety of newspapers and web sites.