A deep dive into the South Korean resale market

The South Korean resale market is hot. But don’t take our word for it. Just look at Naver, the South Korean internet giant that bought up Poshmark for a whopping $1.2 billion. Or StockX, which started operating in South Korea in 2021 with an authentication center in the Gyeonggi province.

“Having an authentication center on the ground allowed us to roll out a range of new features…including expanded shipping options for sellers, lower fees and faster shipping for buyers, and in-market customer support teams,” Greg Schwartz, StockX co-founder and COO, told Retail Brew via email.

Other South Korean resale players, like Kream and Musinsa, are also growing their presence. The South Korean sneaker-resale platform, SoldOut, for instance, just raised $33 million earlier this year.

Currently, the South Korean resale market is worth around 500 billion won ($346.2 million), and is only expected to grow over the next couple of years.

But what’s behind this influx of secondhand marketplaces in South Korea, and what do retailers need to do to stay ahead?

Young guns: Roana Bianca Brito, strategy director at global innovation consultancy R/GA Singapore, credits the rising interest to South Korean Generation MZ—a term used to define the combination of millennials and Gen Z in the country—who are looking for quality items at lower prices. “This consumption sensibility, together with global inflation concerns, is what’s driving the secondhand market demand,” she said. “The fact that the practice helps the environment, and that they can enjoy a little profit on the side if they choose to re-sell,” are fun bonuses.

Per the Korea Statistical Office, in 2019, Generation MZ comprised about 17 million people, accounting for about 34% of the domestic population.

Since most of these consumers are extremely digitally savvy, it has also helped give online secondhand resellers a lift. “In the US, [the secondhand market is] still more skewed to physical stores, whereas in South Korea, it’s more digital,” Claire Tassin, retail and e-commerce analyst at Morning Consult, told Retail Brew.

But while online shopping definitely has a stronghold in the country, things are changing as local IRL marketplaces emerge.

SoldOut, for instance, recently opened a physical store in Seoul for the selling and resale of limited-edition sneakers, emphasizing the relevance of an omnichannel strategy versus online only. “For these digitally powered operators, an omnichannel approach—integrating on and offline customer experience—is second nature,” Athena Chen, senior editor at WGSN, told Retail Brew in an email, adding that this approach is critical to standing out and increasing consumer engagement.

This shift towards integrating physical resale stores is also significant for luxury resale shoppers, who are looking for more than just a good deal.

Local delights: Most of South Korean Gen MZ shoppers seek a specific brand or a specific trend like Y2K and ’90s vintage, which Chen said have continued to gain popularity. “The enthusiasts look specifically to items created within the eras of notable ex-creative directors and echo the archival interest of Gen Z fashion enthusiasts in the West who sniff out vintage pieces and share their hauls on social media,” she said.

It also explains why Naver invested in luxury resale platform Vestiaire Collective back in 2020, which has recently launched in Korea with a dedicated localisation team.

For StockX, its sneaker-fanatic consumers have taken a particular interest in streetwear luxury brands, like Supreme and Stussy, Schwartz said.
In South Korea, Supreme products were purchased at a rate that was three times higher than the global average, while Stussy products were purchased at 3.5 times higher than the global average rate. “Stussy apparel in particular is popular, with Nike x Stussy collaborations performing extremely well,” he said.

Per Chen, younger consumers purchasing these high-end secondhand sneakers are looking at it as an investment. “Driven by the collab drop culture of activewear, sneaker resale has become an investment phenomenon to rival NFTs and Asia’s hypebeasts are among the most active on international resale platforms such as StockX, and the speculative sneaker market is considered a serious investment tool in Korea,” she said.

But as the market keeps evolving, so will newer opportunities for other players. And to stay ahead in the South Korean resale game, retailers will have to invest in authentication efforts much like StockX’s, especially as luxury resale steadies on.

“Luxury goods will continue to be a big segment, with more scrutiny on authenticity and tightening restrictions for resellers whose sole intent is only to resell,” R/GA’s Brito said. “Secondhand growth in categories such as mass fashion will also continue, and technology will be one to watch.”—JS