In some other parts of the forum, we discussed luxury brands taking over their own preloved market. We took the thread OT, so I opened a new one here. Funnily enough, I just read now that Gucci is teaming up with TRR to have a section for preloved sales. Also, I recently attended a Vogue Business webinar, Future Luxe: What’s Ahead for the Business of Luxury, by Erwan Rambourg (who used to work for LVMH if I recall correctly) and he also addressed the idea that luxury brands should control their own preloved market. I am not sure it was so much about authenticity etc issues, but about connecting with the future generation of customers.
Luxury brands managing their own preloved market
- Thread starter lara0112
- Start date
Quite a few luxury brands have figured out that some people will start with a preloved bag, then fall in love with the brand and develop a relationship with the brand, as their income grows, they have more disposable income to spend on the brand. Also since the 2nd hand market is growing, possibly the highest growing sector, there is a risk of devaluation of the prestige and exclusivity (why would a brand spend millions on advertising, image, brand ambassadors and such, to court a segment of the market, if that segment they are trying to court is turned off by the fact that their item is available for less, to a less wealthy clientel), by taking control over the 2nd hand market, they are protecting their turf, and most importantly, they have the ability to earn again and show themselves as eco responsible and friendly.
It is a bit like couture, fashion shows lose millions, but they need to do them to stay relevant, the real earner for fashion houses is the pret a porter collection, and accessories like bags, sun glasses, shoes... There is a relatively small percentage that can afford a couture gown or item regularly, there are a lot more people who can afford ready to wear, bags, shoes...
Most brands have already developed lines that are more affordable (See by Chloe, Karl by KL, Burberry Brit, Alice by Temperley, etc) to increase their earning potential, to take control over preloved is a logical step that has been discussed for ages, but so far they have hesitated as they were worried about the thrift shop implications. I always thought if they would play their cards right and pretend it is to make sure that only authentic items in great condition are in the preloved market, they could appeal to the people who buy new.
sustainability for sure is one of the main factors why this is considered - the fashion industry in general is extremely wasteful. The secondary market already exists - in my opinion, there are people that only want brand-new, boutique, etc, there are people that don't mind, and there are people that prefer preloved, for whatever reason. I feel that the 'exclusivity' ship has sailed a long time ago - demand can be created that way, but not growth. Keeping the balance, I'd say, or rather the elusion of exclusivity, while maintaining a a satisfactory growth rate is probably a successful strategy.
It might be interesting to see the option to trade in preloved bags for a new one.
It might be interesting to see the option to trade in preloved bags for a new one.
I think they will push that option heavily, because that is where they will earn the most, and which will have a massive appeal to everybody, Chanel has already done this in the past but not overly publicised it for obvious reasons, a friend in Austria managed to get a preloved flap (I think the Gabrielle) from the Chanel shop, totally refurbished by them and with box and all for roughly half the price of a new one, she said it was such an experience, she now is going to buy more, maybe small leather goods, as she was blown away by the customer service.
ETA - I think 80% would prefer to buy new, in the shop, for most pieces I will, but I made it a rule to never spend that much on a bag where it becomes indecent, I don't see them as investment pieces but as items that have to work for me, practically and with my style, there is always the danger of an accident, a bag can be stolen, scratched, if I am THAT worried, I can't enjoy the bag or work efficiently, some items I really like aren't produced anymore, so 2nd hand market is the only option open. Up to 5K (GBP) I will buy new, going much higher over that limit, while not unaffordable, it seems frivolous and has to be a rare thing, not an impulse buy.
ETA - I think 80% would prefer to buy new, in the shop, for most pieces I will, but I made it a rule to never spend that much on a bag where it becomes indecent, I don't see them as investment pieces but as items that have to work for me, practically and with my style, there is always the danger of an accident, a bag can be stolen, scratched, if I am THAT worried, I can't enjoy the bag or work efficiently, some items I really like aren't produced anymore, so 2nd hand market is the only option open. Up to 5K (GBP) I will buy new, going much higher over that limit, while not unaffordable, it seems frivolous and has to be a rare thing, not an impulse buy.
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T
the_black_tie_diyer
Trying to control the second hand market as a whole is bound to fail.
What they can try to do is controlling the actual damage done to the brand by commercial players in this market segment selling fakes (unknowingly or because they slipped through the authentication process) by providing a reliable link between a customer with authentic products, now becoming a consigner to a vetted/ brand partnered 3rd party consignment store, who then can de facto guarantee authenticity of the product because of this direct link. It's not exactly fail safe, but it's overall a more secure way of authenticating items, as you can go though a consigner's shopping history and vet/compare purchases. Let's not go into the hurdles of this and all the privacy concerns/issues that come with it - but in theory its an option.
Products obtained in this manner could feature a higher re-sell value, but the real question will be who is benefitting from that. If it's the brand and consignment store, potential consigners will think twice about choosing such an option and sell or consign the items as it has been done before. And a higher re-sell price, potentially closing in on the actual boutique/new price will drive more people back to the boutiques. As in: "Why buy preloved if there is no substantial savings?" - "Why consign this way if there isn't the benefit of a higher buy out price".
Really rare items will still go to auctions.
What it actually really could provide is a cheaper method of handling returns as well as overrun for brands. Instead of handling them themselves, let a commercial player on the preloved market do it. Not an option for all brands obviously, as partnerships like this massively tampers with their "exclusive"/"elitist" images.
Just my random thoughts on this subject.
Kind regards,
Oliver
What they can try to do is controlling the actual damage done to the brand by commercial players in this market segment selling fakes (unknowingly or because they slipped through the authentication process) by providing a reliable link between a customer with authentic products, now becoming a consigner to a vetted/ brand partnered 3rd party consignment store, who then can de facto guarantee authenticity of the product because of this direct link. It's not exactly fail safe, but it's overall a more secure way of authenticating items, as you can go though a consigner's shopping history and vet/compare purchases. Let's not go into the hurdles of this and all the privacy concerns/issues that come with it - but in theory its an option.
Products obtained in this manner could feature a higher re-sell value, but the real question will be who is benefitting from that. If it's the brand and consignment store, potential consigners will think twice about choosing such an option and sell or consign the items as it has been done before. And a higher re-sell price, potentially closing in on the actual boutique/new price will drive more people back to the boutiques. As in: "Why buy preloved if there is no substantial savings?" - "Why consign this way if there isn't the benefit of a higher buy out price".
Really rare items will still go to auctions.
What it actually really could provide is a cheaper method of handling returns as well as overrun for brands. Instead of handling them themselves, let a commercial player on the preloved market do it. Not an option for all brands obviously, as partnerships like this massively tampers with their "exclusive"/"elitist" images.
Just my random thoughts on this subject.
Kind regards,
Oliver
Interesting discussion.
A while ago I wrote that I thought Hermes may be taking strategic decisions on the basis of what’s going on in the pre-loved market (exploding right now). Some others thought that Hermes could not care less if not for trying to control resellers and the like.
I think we are only seeing the start of this, and that the whole thing can take any direction at the moment, but that it is quite likely that things are going to change quite a bit in the future in this market. The big groups are not going to leave it alone until they get their piece, if not the whole cake.
For example, a member recently posted that after reselling a bag she’d bought at the Hermes website, Hermes had blacklisted her, i.e., they were not selling her any goods and they wrote an elaborate letter with a detailed legalistic explanation. Obviously, Hermes cannot prevent a legitimate owner to sell a bag. But they may choose not to sell to those who do. Which may not be wise unless, they actually provide an acceptable way for reselling. Which they will then to some extent control. I can see this could be a way for luxury houses to go. Or buy back schemes. Another would be to come in as authenticators of their own products. They could establish virtual monopolies in terms of offering or supporting sites that can guarantee authenticity...
A while ago I wrote that I thought Hermes may be taking strategic decisions on the basis of what’s going on in the pre-loved market (exploding right now). Some others thought that Hermes could not care less if not for trying to control resellers and the like.
I think we are only seeing the start of this, and that the whole thing can take any direction at the moment, but that it is quite likely that things are going to change quite a bit in the future in this market. The big groups are not going to leave it alone until they get their piece, if not the whole cake.
For example, a member recently posted that after reselling a bag she’d bought at the Hermes website, Hermes had blacklisted her, i.e., they were not selling her any goods and they wrote an elaborate letter with a detailed legalistic explanation. Obviously, Hermes cannot prevent a legitimate owner to sell a bag. But they may choose not to sell to those who do. Which may not be wise unless, they actually provide an acceptable way for reselling. Which they will then to some extent control. I can see this could be a way for luxury houses to go. Or buy back schemes. Another would be to come in as authenticators of their own products. They could establish virtual monopolies in terms of offering or supporting sites that can guarantee authenticity...
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This is what I posed in the blacklist thread. I cant seem to find the original on Vouge.com. (Hopefully the link still works)
https://www.msn.com/en-us/lifestyle...e-changing-partnership/ar-BB19HX8R?li=BBnbcA0
https://www.msn.com/en-us/lifestyle...e-changing-partnership/ar-BB19HX8R?li=BBnbcA0
It just seems odd, while I am not too keen on the Hermes bags (they do not work for me or my needs) I love a ton of Hermes products, belts, shoes, gloves... So I am spending a bit there, due to owning a company, we also give Xmas presents and such to loyal customers, we usually get them from H, H knows, I know that some of the items get resold (kind of amusing that somebody who earns as much will try to make a profit from a present, but hey...) my SA knows about it, she also knows I am not likely to buy a bag so it is a running joke that she sends me some of the coveted bags...
While I think the idea of supporting sites that will offer authenticity via support from the manufacturer is great, it would be wonderful for all parties involved, the pound of flesh they would take (especially in the case of H) would possibly make the preloved product only marginally less expensive than the original