Summer’s almost here, and consumers contemplating doing a little shopping will likely look at some resale platforms. After all, there are so many. But are consumers heading online to shop or are they paying their local thrift store a visit?
When we previously spoke to analysts about whether resale platforms were still a good idea for fashion retailers as the category gets bigger, their answer was (spoiler alert) an overall yes. But now the question is: Once a brand has launched their own resale initiative, should they be doing it online or offline—or perhaps both?
We asked the experts.
Brian Ehrig, partner in the consumer practice of Kearney, believes that digitizing resale is generally a good idea since it allows brands to automate the process and list items online more easily. But for luxury brands like Gucci, he said the situation may be different.
“If I were in their shoes, I wouldn’t want that to be pushed to digital, because in their case, their stores are basically like jewelry boxes,” he told Retail Brew. “Those types of products are probably going to be off the sales floor anyway. They’re not going to be featured because you don’t need to convince people to come in and shop at Gucci; they already want to come in there. In their case—and in the case of a lot of luxury companies—they’re looking at resale as a way to continue to nurture the relationships of their VIP customers. In the luxury business of small, low, single-digit percent of people drive all of the business basically…So their resale strategy is about how do we increase the affinity for our brand, with that small number of people, and let them unlock the value they have in their closet so they can get the next coolest Gucci bag.”
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Claire Tassin, retail and e-commerce analyst at Morning Consult, said that it’s not important to have an actual store to make a mark in the resale biz.
“It’s really hard to have a physical location,” she told Retail Brew, pointing specifically to the Real Real “that did have brick and mortar and had to pull back from brick and mortar.”
“I think just the inventory management of secondhand—if the brand is taking ownership of those products—is so challenging,” she said. “Adding brick and mortar to that is only going to add complexity versus the digital space is so much easier to access for the consumer and much easier to manage for the brand. I don't think that getting into brick and mortar requires an enormous amount of inventory. That would be really challenging. Maybe leave that one for the thrift stores that already have their presence there or for a multi-brand environment that is going to be more successful than a single brand.”
For others, like Andy Ruben, founder and executive chairman at Trove, told Retail Brew resale is an “omnichannel proposition because that is how today’s customers shop. This doesn’t mean that brands need to start everywhere all at once. Brands can begin with one channel, but eventually, it will be both. What brands need to effectively build this omnichannel resale approach is the technology to path items and merchandise them in store and online, just like they do with new pieces.”—JS