Midyear luxury resale reports from companies like The RealReal and ThredUp shine a bright light on the trends and challenges in retail. Chief among them are a focus on menswear and the revival of legacy brands previously on the decline.
“What we find is what’s happening in our business in the secondary market is a direct reflection of what’s happening in the primary market,” said Rati Levesque, chief merchant at The RealReal. The report found a rising interest in menswear consignment, which dovetails with the larger market.
Reports also show a resurgence of legacy brands like Chloé and Gucci, both of which recently experienced leadership changes and increased digital offerings that have bolstered sales.
In the menswear market, suit sales rose by 60 percent and men’s consignment has more than doubled, growing at a rate of 108 percent year over year, according to the The RealReal report. Levesque said one of the most surprising findings was that the men’s Birkin bag sold 100 percent of its inventory, demonstrating a mounting interest among men in consignment luxury apparel and bags.
“Men are becoming more engaged in consignment. They’re thinking more about what they’re purchasing and what has value in the secondary market,” she said.
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This could be in part due to the lower stakes involved with investing in resale. As Jian Deleon, menswear editor at WGSN, told Glossy, “given the market, the general men’s consumer is not someone who take risks.”
According to ThredUp, the total resale market is poised to reach $25 billion at a total growth rate of 82 percent for online apparel resale by 2025. The company anticipates this is expected to outpace both e-commerce and retail in the next 10 years, and will be aided by the consolidation of the resale market from 14 major companies to six, in part due to changing sentiment toward resale.
“The secondhand industry is gaining incredible momentum,” Paula Sutter, former president of Diane Von Furstenberg and ThredUp board member wrote in the report. “With heightened interest from consumers, investors and retailers, online resale is becoming a way of life.”
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Levesque said ongoing changes in creative leadership at major fashion houses often have a major impact in consumer sentiment in both the resale and wholesale marketplace. Since Phoebe Philo took control of Céline in 2008, The RealReal has seen a continued increase in Céline sales, which was traditionally “a hard brand to move.” Philo’s ascension included launching a series of iconic handbags that helped bring sales up to more than $500 million as of February. In the LVMH Group earnings report shared on July 2016, Céline and Kenzo are noted as brands that specifically demonstrated “strong growth” in the first half of 2016.
The company is now seeing similar trends with Gucci. Levesque said The RealReal was systematically lowering prices in response to lowered demand, until Alessandro Michele took the helm of the brand last year. Over the course of 2015, Gucci overtook Prada to be the fourth biggest seller, the report’s data shows. Prada is now at number six. This echoes Gucci’s overall growth, which earned a total of $1 billion in Q1 of 2016, up by 3.1 percent from Q1 2015.
“Now you see everything Gucci,” she said. “Older, newer, it’s all moving very quickly at a higher average selling point.”
Brands like Chloé, which is in the midst of a major digital transformation with its first foray into e-commerce, also performed well. The report showed that sales of the Chloé Drew handbag increased by 18 percent and the Chloé Marcie bag by 15 percent, and the online store will only enhance the resale market, Levesque predicted.
