Jacki was having a Spring clean over the weekend (she’s a bit of a hoarder). I say ‘little’ because she got distracted when she came across her World Cup Mexico 1986 Panini sticker album.

Like many classic childhood pastimes, Panini is an association to childhood, growing up and memories. It’s as much about the experience of filling the book as it about the football tournament itself. Jacki couldn’t remember who England played at each round, but she vividly recalled Pique the Mascot, the shiny foil team badges, that smell of opening a fresh packet, and of course the challenge of filling the album.

And this is where the business lesson comes in; and why the Panini model is so successful.

According to a study*, when you start an album, your first sticker has a 640/640 probability of being one you don’t already have. As the spaces get filled, however, the odds of opening a pack and finding a sticker you want lengthen.

The number of sticker packs you’d have to buy on average to fill the album by mechanically buying pack after pack would be 899!

Of course, it’s inefficient to buy pack after pack as an individual, and as a ten-year-old Jacki’s weekly pocket money only stretched to one pack of stickers and a copy of The Dandy.

The answer was to create a market for collectors to swap their unwanted stickers; and the playground was the answer to this. A kid who has a card prized by many soon realises the power of limited supply.

Sticker fairs are another example; the more people who can be attracted into the market with their duplicate stickers, the better the chances of finding the sticker you want. As with any market, liquidity counts.

Of course, Panini doesn’t need to be worried that sales are going to drastically slump – even in today’s digital world – because as in all markets, behaviour is not strictly rationale. Jacki got so obsessed with getting her hands on Shilton, Maradona, Rossi, Sócrates and Rudi Völler, that she was prepared to tear out most of her stickers!

Does any of this resonate with your market……?

Have a great week.

* Economist Tom Standage reports on a study by the University of Geneva