The Harbinger that is the Comic Book Bubble of the 1990s

By Lon W. Schiffbauer, BA, MBA, PhD, SPHR

The Harbinger that is the Comic Book Bubble of the 1990s

History is replete impressive economic bubbles, from the posterchild that is Tulipomania of the 1630s, Railway Mania in the 1840s, to the Dot-com bubble of the 1990s and the housing boom and bust of the 2000s. However, one bubble that is not often included among this esteemed company of economic crashes is the comic book bubble of the 1990s. Granted, the collapse of the comic book industry didn’t have the far-reaching impact of those bubbles I mentioned, but this particular case study is interesting for two reasons. First, it showcases all of the classic elements that comprise an economic bubble in ways that’s easy for us mere mortals to understand. Second, in some ways this bubble is repeating itself as comics have made the jump from the printed medium to cinema and streaming services. Having found a new home in these media, the comic book industry seems intent on repeating the mistakes of the past. But I’m getting ahead of myself. Let’s begin with the start of the comic book bubble.

PART I: The Comic Book Bubble: A (very) Short History

In 1974 you could buy a copy of Action Comics #1, featuring the first appearance of Superman, for around $400. Ten years later, in 1984, that same comic would go for about $5,000. Then, in 1991, a copy sold for an eye-watering $82,500.

Comic books, those cheap dime-store rags that kids used to buy with their allowance money, were now the hottest collectables out there.

Not ones to miss out on this wave, comic book shops started popping up all over the country. Of course, these shops traded in the rare old comics, with rows and rows of white comic book boxes lining the walls, but even the newest editions saw breath-taking price gains. It was not uncommon for a comic to sell at its cover price (generally 60 cents or a dollar) the month it was released, only to then appreciate to $10 or $15 just a few months later.

Before long a full-fledged bubble market had formed around comic books, and like all bubbles, this one, too, was destine to burst.

By the mid-1990s, nine out of ten comic book shops in the United States closed their doors. Sales of new comics dropped by something in the neighborhood of 70-percent, and incredibly, on December 27, 1996, Marvel filed for bankruptcy.

The party was over.

So what brought about this comic book bubble in the first place, and what led to its demise? Let’s explore this.

PART II: Factors That Contributed to the Bubble

Rarity

When it comes to golden- and silver-age comic books, rarity is all but assured, though certainly not by design. Back in the day, comics weren’t thought of as a collector’s item. They were intended to be purchased by kids with money they earned doing chores, folded in half, shoved in their back pockets, and passed around with friends after school. The lowest of all print media, these comics were printed on the cheapest newspaper stock available. It wouldn’t be a stretch to say that these books started decomposing from the moment they came off the printing press. Because of this, few copies are intact today. Take for example Action Comics #1. Today it’s estimated that no more than 50 to 100 copies remain.

This was all fine and dandy for the older books, but the newer titles couldn’t rely on these factors to create rarity, so publishers had to resort to other methods.

• New Titles:With increased interest in comic books, and more and more retailers popping up each day, demand for comics went through the roof. The publishers met this demand by increasing production and publishing more and more new titles. In 1985, before the market took off, Marvel published about 40 titles a month, each costing around 60-cents. By 1993 the number of titles ballooned to 140 books a month, most selling for $1.25 or higher.
• Variant Covers:Another way comic book publishers fed this demand was through the introduction of “variants”. This practice involved publishing popular issues—such as first editions, first appearances, or origin stories—with various alternate covers, many published in limit quantities. Collectors and speculators would then descend upon the comic book shops in a frenzy, eager to pick up all the variants. This not only drove up demand for that month’s issues but increased after-market resale values as well. The value of these variants rose dramatically during the early part of the speculation boom, with some issues selling for as much as $20 within just a few months of publication—issues that originally sold at a cover price of $1.75.
• Crossovers:To further increase the demand for their products, publishers began launching more and more mega-crossover events. A crossover event is a storyline that spans across multiple titles. It’s not hard to see why this would be attractive to publishers. It basically forced readers who wanted to follow a story arc to purchase issues from titles they wouldn’t normally follow. No longer could a reader follow the story by reading just one or two titles, now they had to branch out to almost a dozen others. Furthermore, these crossover events could last the better part of a year, turning a casual $10-a-month hobby into a major $50-a-month, year-long commitment. While some of these crossover events were well-received, others were more cynical and left readers feeling disrespected and manipulated.
• Gimmicky Events:Traditionally, comic books that go up in value tend to be first editions, first appearances, origin stories, and character deaths. The flood of new titles made sure that there were always more first editions for the speculators to pick up, but there was a lot more publishers could do. In 1993, DC published the death of Superman, a major crossover event spanning 15 books across six titles, some with variant covers. In all, Superman #75—the issue featuring the hero’s death—sold more than six million copies, making it the best-selling comic book to date. Other titles followed similar tracks. Batman: Knightfall featured Bane breaking the Caped Crusader’s back, opening the door for other characters to don the cape and cowl while Bruce Wayne recovered, creating a need to buy all the issues. Eventually these events became very gimmicky, such as the time Marvel said Spider-Man wasn’t Peter Parker after all but a clone named Ben Reilly!

In addition to the perception of rarity created through these practices, there were other factors as well that contributed to the bubble:

Distribution

In the early days comics were slow to make the jump from newsstands and five-and-dimes to dedicated comic book shops. This was primarily due to the barriers to entry distributors placed upon comic book shops. Distribution companies—Diamond and Capital City being the two powerhouse distributors in the industry—required that would-be comic book shops demonstrate financial viability, as well as guarantee a minimum book count in their monthly orders. However, with the new comic book market raging in the country, Diamond and Capital City eased the entrance requirements for new merchants. Essentially, a $300 order could get you started. Predictably, comic book shops proliferated, growing from about 800 in 1979 to something around 10,000 by 1993.

A ”Stock Ticker” for Comics

In 1991 Wizard Magazine came onto the scene, providing the market with a monthly pricing guide for tens of thousands of comic books. While other pricing guides, such as the Overstreet Comic Book Price Guide, had been around since the 1970s, Wizard brought the service into the mainstream, feeding up the information in a full-on glossy magazine with articles, spotlights, contests, and other features, all delivered in a playful, comic book esthetic. This helped to feed a speculation boom in which comics were bought and sold like stocks.

Low Buy-In

The nice thing about comic books is there is a very low buy-in for new collectors. Sure, you may not be able to afford a copy of Incredible Hulk #181, featuring the first appearance of Wolverine, selling for about $10,000, but there are any number of less exotic yet still desirable comics one could purchase at very affordable prices. This way everyone could participate in this booming market, making it grow all the more.

Speculation

With the price of comics rising so quickly and dramatically, it was inevitable that the industry would attract market speculators—those who had no real interest in the comics themselves; only in the profits they could potentially bring upon future resale. In many cases, new comics weren’t even taken out of their mylar bag, backed with an acid-fee board. Mint copies brought in the best resale value, and there’s nothing more mint than untouched.

Stockpiling

With speculation came stockpiling. Speculators saw themselves paying for their kids’ college on the value of their comics. This meant buying multiple copies of any issue that stood the slightest chance of increasing in value and storing them in purpose-built comic book boxes. For even a more-or-less passive collector/speculator it wasn’t long before their basement or garage was filled with a dozen or more boxes, each holding 150 bagged and boarded comic books.

Lack of Visibility to Leading Indicators

Retailers placed their orders with distributors three months in advance. This meant that, from a publisher’s perspective, they wouldn’t have visibility to shifts in the market until they were well past the point of no return. This practice stung retailers as well since unsold stock could not be returned, nor future orders cancelled. Pre-ordering tens of thousands of copies for an anticipated demand that failed to materialize left the retailers saddled with massive amounts of overstock.

A Rudimentary Futures Market

A common practice for comic book retailers was to set up what was known as a pull- or hold-list for their regular customers. The idea was that the customer would provide the retailer with a list of all the comics they would like to regularly purchase, month after month. The retailer would then pull these copies directly from their monthly shipments from the distributors and hold them for their customers. This way the customer would be guaranteed to get the editions they wanted without fear that the retailer would sell out before they could make it in.

Some particularly entrepreneurial speculators would list multiple copies of a highly-anticipated edition on their pull-lists, then resell these copies before they even came in. This created something of a proto-futures market for the books.

The Bubble Bursts

Eventually, as with all economic bubbles, the community started to realize that whole comic book economy was a house of cards and their “fortunes” were on shaky ground. Prices of the high-value comics that launched the boom in the first place declined or remained flat, while the mid-tier issues—those that traditional sold at around the $100-level—lost significant value. None of this, however, compared to what happened to the new comics published during the height of the bubble. These became virtually worthless as the market was suddenly flooded with the inventories of out-of-business comic book shops (over two-thirds going out of business) and speculators trying to unload their stock before prices dropped any further. Before long, comics that once should in the hundreds of dollars were now all but worthless.

PART III: Parallels Between the Marvel Bankruptcy and Today

The crash of the comic book industry took no prisoners. Valiant Comics, once the third-largest comic book publisher in the industry, was acquired by Acclaim Entertainment. Other comic book publishers, including Malibu Comics, Eclipse Comics, Comico Comics, and several others closed down. But the real shock came in 1996 when the comic book giant Marvel declared bankruptcy. While hard to imagine, the math isn’t hard to wrap your mind around. When a publisher sees a 70-percent drop in sales, pain follows, and Marvel was no exception. But while Marvel fell victim to the comic book bubble like the rest of the industry, there were other ways that the company contributed to its demise—things that, if they’re not careful, they may end up repeating.

New Titles

In 1985 Marvel published about 40 comic book titles a month. By 1993 the number more than tripled to 140. We’re seeing this same sort of title inflation happening today. Marvel Phases 1-3 included 23 theatrical releases between 2008 and 2019, 11 years total. By contrast, Phase 4 includes 7 movies, 8 television series, a couple holiday specials, and an assortment of shorts. This means Phase 4 has about 17 titles, all released within a couple years. In considering these numbers, it’s worth bearing in mind the watch time. Some of the television series include something like 6 to 8 hours of watch time. This means that, in terms of watch time, Marvel has released in the past two years more or less the same amount of content as it did the previous 11 years.

New Characters

Remember Maxima, Kane, Cybernary, Deadlock, Bedrock, Superman Red/Superman Blue, ShadowHawk, and Bloodwynd? Neither do I. These and many more characters were introduced and just as quickly forgotten during the comic book boom. Likewise, I doubt I could count the number of new Phase 4 characters with any degree of accuracy. The Eternals alone introduced something like 11 new characters. Trying to keep track of the likes of Yelena Belova, Agatha Harkness, Monica Rambeau, Shang-Chi, Xu Xialing, Sersi, Kingo, Kate Bishop, Maya Lopez, Marc Spector/Steven Grant/Jake Lockley, Dane Whitman, Eros, John Walker, Kang the Conqueror, America Chavez, Clea, Kamala Khan, Jack Russell, Elsa Bloodstone, Jennifer Walters, and Valentina Allegra de Fontaine (and there are more!) is like trying to map the human genome.

More Crossovers

Comic book cross-overs were frustrating to the readers because they forced them to purchase and read comics that didn’t necessarily interest them but contained important details needed to follow what was happening in their favorite titles. Marvel is doing the very same thing today. Viewers are expected to subscribe to Disney+ and watch shows just because they may include details they’ll need when watching their favorite characters in the cinema. Essentially, Marvel is assigning homework, and requiring them to pay for the privilege of doing this busywork.

Increased Prices

As noted above, Marvel now requires its fans to subscribe to Disney+ if they want to have any hope of following the ever-growing web of storylines. Now for many, $11 a month may not seem like a big deal, but for some on something approaching a fixed income, $11 isn’t immaterial. It also presents an opportunity cost. Not many can afford to subscribe to more than a few streaming services, so by saying “yes” to Disney+ viewers are forced to say “no” to another service, all for the sake of their Marvel characters.

Treatment of Talent

During the comic book boom, comic book artists didn’t own their characters; companies like Marvel and DC retained all ownership of their employees’ creations. What’s more, publishers considered the artists to be less important to a comic book’s success than the characters themselves. After all, readers came for Batman, Spider-Man, the X-Men, and Superman. Artists and writers could be easily replaced; it was the character that sold the books. Artists were just paid a flat page rate, regardless of how much revenue an issue, title, or character generated. Some of the more celebrated artists took issue with this practice and tried to negotiate for greater control over their characters, but the publishers refused. In the case of Marvel, this created a schism between the publisher and several of its top artists, eventually resulting in these artists leaving and starting Image Comics.

Today we are witnessing something similar to the treatment of CGI artists. Though independent contractors to Marvel, these shops are struggling to keep up with the amount of work being demanded from them, all paid at a set rate. Whereas actors and others are often paid according to box-office draws, CGI artists are paid at what is essentially and hourly rate, all the while delivering the lion share of what you and I see on the screen.

Diluting Quality

The more than tripling of comic book titles and characters back in the 1990s took a severe toll on the quality of the stories and artwork. Likewise, the same can be said for Marvel today. When a studio forces so much content through the system, taxing the writers, crews, and CGI artists, quality is going to take a hit. When hobbyists working out of their basements can take your product and improve upon it, all to troll your company, you know you have a problem.

In Conclusion

The thing about economic bubbles is that we only see them clearly in the rear-view mirror, and when we do, we wonder how anyone could have been so foolish as to think this was anything but a house of cards. Truth is, we are forever building new houses of cards, all the while thinking we’re following best practices and being responsible stewards of our resources. Marvel is no different. With Phases 1-3 they did something that had never been done before, so why wouldn’t they think that more of a good thing wouldn’t be a great idea? And yet their past success may have created the perfect environment for their eventual self-destruction.

References

Last, J. V. (2011, June 4). The crash of 1993. Washington Examiner. Retrieved November 25, 2022, from https://www.washingtonexaminer.com/weekly-standard/the-crash-of-1993

Pulfer, R. (2020, January 22). The comic speculator bubble explained. ScreenRant. Retrieved November 25, 2022, from https://screenrant.com/the-comicspeculator-bubble-explained/

Lon is an Associate Professor of Business Management at Salt Lake Community College and holds an MBA, a PhD, and is a certified Senior Professional in Human Resources (SPHR). In addition to his academic background, Lon spent close to 30 years working and consulting for such companies as FedEx, Intel, eBay, and PayPal, as well as a variety of small to mid-sized companies around the world.