A fabled Gucci handbag or a fabulous Fendi dress has a second life in the resale market. I visited over 20 locations and found wonderful fashion merchandise at affordable prices. Much of it is on consignment, meaning that the e-commerce site only promotes the merchandise while the products are actually still owned by the companies that sell them. Today, this resale activity is a $24 billion industry and certainly affects traditional retail sales in stores and on the internet.
Most of the internet locations I visited had a discount incentive to buy now – it was the proverbial hook that store owners had when business was slow and they had to attract customers to shop in their store. First-time customers are welcome with an instant loyalty program.
Designer name brands are featured at most sites. Luxury shoppers can find designer goods of the labels they love. They can shop fashion and accessories from Gucci, Versace, Chanel, Fendi, and other designers. Occasionally, a North Face garment has a prominent display. It is obvious that many of the garments have hardly been worn, and at a discount to the original price they find a new home. The question whether the merchandise all is authentic is, of course, important. It was highlighted in April, when Chanel sued a reseller for trademark infringement and selling counterfeit merchandise.
The most amazing development is in the sneaker resale industry. A recent study shows that resale sneaker sales now account for more than $2 billion in annual sales. By 2025, sales could reach $6 billion in the resale market. There is strong demand for athletic shoes like Nike’s Air Jordan 1, Adidas’ Yeezy Boost, Nike’s Air MAX, Balenciaga’s Triple S, Fendi’s Multicolor, and Van’s F.O.G. (Fear of God). Unlike many of the other resale fashion categories, they often sell for many times their original high prices. For instance, Yeezy Boosts that originally cost $300 resold for $1,239. According to Sourcing Journal, a pair of black Air Jordan Art Basel sneaker produced in a very small quantity (only 23 pairs) resold for $4,000 last year.
Here is a listing of some of the resale sites. It is by no means a complete list.
- What Comes Around Goes Around
- Vestiare Collective
- The RealReal
ThredUp published some astonishing figures. The $24 billion market is projected to jump to $51 billion by 2023. That would mean that the resale market could command as much as 10% of the retail industry’s sales. It’s important to point out that 50% of the resale market is in apparel, so every fashion brand should pay attention to this market.
Customers of all ages shop in the resale market, but there is a definite appeal among young people for vintage that draws them to this industry. Data backs this up: 37% of Gen Z shop resale, compared to 27% of millennials and 19% of baby boomers. It figures as young people like vintage clothes and their history. In addition, it is typical of their lifestyle—they want to share but not to own.
I publish some of these findings because there is confusion, as well as concern, about what all of this says about the shopping habits of the consumer. The ability to shop for prior-used clothing is certainly another way to save, but it also shows that shoppers still want to be in step with fashion trends. I am concerned that there will a slowing of luxury sales as a result of the growing resale momentum.