As demand for sustainable products rise, luxury re-commerce is emerging as a big opportunity for brands to capture the millennial audience. However, with brands being slow in catching up with this trend, third party platforms such as The RealReal, Vestiaire Collective, and ThredUp are fast emerging.
However, a Business of Fashion report suggests experts are now questioning the profitability of these platforms. They point out publicly traded companies like The RealReal are yet to make profits with increased competition, digital processing, authenticating and listing of thousands of unique items, impacting bottomline.
Brand-operated resale over third party platforms
As per a Forbes report, Andy Ruben, Founder and CEO, Trove, however, believes, selling branded luxury items can help retailers like Dior, Louis Vuitton, and Valentino control their intellectual property and retain their newly acquired customers. Earlier reluctant to sell pre-owned luxury items, brands are now embracing the opportunities being offered by luxury recommmerce to retain customers and grow their client base. A recent survey by First Insight and the Baker Retailing Center at the Wharton School of the University of Pennsylvania shows, over 65 per cent American consumers preferred to buy products from brand-operated resellers against third party platforms.
Technology facilitates customer’s shopping experience
Technology is helping brands and third-party platforms sell thousands of pre-loved fashion items every day. Third party platform Vestiaire Collective adds 140,000 new items to their online inventory each week to digitize the entire shopping process and offer consumers a seamless and pleasant experience. Technology also enables brands to position resale as additional revenue channel for fashion and luxury brands. It helps brands convey the benefits of buying pre-loved products to customers. .Trove has launched a technology that allows brands to expand their business without causing any harm to the environment.
With technology, brands can control their own resale channel to offer consumers a better shopping experience than third party sellers. They can form deeper ties with consumers offering them early access to new products besides offering discounts. Technology can also offer brands an invaluable insight into data, enabling them to strengthen their ties with consumers.