Stadium Goods, the New York-based retailer specializing in reselling rare sneakers, is expanding into China.
Through a new partnership with Alibaba Group’s e-commerce marketplace Tmall, Stadium Goods’ sneaker inventory — it currently has more than 15,000 sneakers in stock — is coming in front of Tmall’s hundreds of millions of customers. The Stadium Goods shop on Tmall, which is live both on desktop and mobile today, sorts products by brands: Nike and Adidas have the most available sneakers, but there are also products from Puma, Vans and New Balance. Nike’s Air Jordan sneaker, a model in high-demand among sneakerheads, is the most popular shoe in the marketplace.
“China is relatively untapped even though there’s tremendous demand,” said Stadium Goods co-founder and CEO John McPheters. “Knowing this, it’s always been a big part of our road map at Stadium Goods. For Chinese buyers looking for quality product, authenticity and trust are paramount.”
Tmall is Stadium Goods’ first venture into China, the second biggest sneaker market after the U.S., with China accounting for 20 percent of the overall $1 billion sneaker resale industry. With the partnership with Stadium Goods, which emphasizes top-notch customer service and guarantees authenticity when selling secondhand sneakers, Tmall hopes to legitimize its sneaker marketplace.
Since 2014, Alibaba has emphasized its continuous effort to wipe out the “gray market” of unverified sellers with its marketplaces, which have become a major peddler of knockoff items. In April, the company joined the International Anti-Counterfeit Coalition, prompting Gucci and Michael Kors to exit the group, citing concerns that the company hasn’t done enough to eliminate unverified sellers. The secondhand sneaker industry has its own counterfeit problem, which companies like Stadium Goods hope to eliminate. China is a major source of counterfeit sneakers, according to a report by designer platform Core77.
“Once a pair of sneakers leaves the retail channel, it’s the Wild West,” said Josh Luber, founder of Stockx, the “stock market guide” for secondhand sneakers. “There are very few, if any, legal, unregulated markets of this size. Literally, anywhere sneakerheads come into contact with each other, shoes will be bought and sold. But that means no efficiencies, no transparency, sometimes not even authenticity.”
McPheters said that Stadium Goods hopes to bring better customer service to the online sneaker consignment market, and to verify authenticity of the shoes that are bought and sold on the web.
The company, which opened its first and only brick-and-mortar location in New York City’s Soho neighborhood last fall, is new to the secondhand sneaker scene, but it’s made big moves in its first year after launch to help improve the online industry: It also has a partnership with eBay to make reselling and buying secondhand sneakers a more straightforward process on that platform. With eBay, which Stadium Goods began working with as an official seller in November, Stadium Goods offers improved customer service and a guarantee of sneaker authentication for purchases.
The Stadium Goods storefront on Tmall.
EBay was a big marketplace push for Stadium Goods. Its sneaker market is worth $300 million annually, or one-third of the $1 billion secondhand sneaker market, and the Tmall partnership marks the company’s biggest global endeavor. Alibaba’s two marketplaces, Tmall and TaoBao, accounted for 80 percent of China’s $300 billion online shopping industry in 2015, and in China, the sneaker market is said to be growing 7 percent year over year, according to Chinese research firm HKTDC Research. Even as China’s economy suffers (the luxury fashion industry particularly has seen widespread slumps caused by lackluster growth in China), the sneaker market is growing: according to an October 2015 report, Nike sales alone in China grew 30 percent in three months, to $886 million. Nike makes up 96 percent of all consignment sneaker sales.
Lastly, the Tmall marketplace is also a play for mobile sneaker purchases, which McPheters said is the company’s fastest growing source for buyers. “We designed this with the mobile customer in mind,” he said. “Sneakers are a passion purchase, and a lot of times, that purchase can’t wait.”