Nike and Adidas are focusing on tight control over distribution, says NPD’s Powell. But some fear that the relationship between the brand and the customer will become strained. “When a brand releases a shoe for $ 150 and it suddenly sells for $ 300, it penalizes the relationship between the brand and the consumer,” says Powell. “While brands recognize that these platforms give them a lot of free advertising, there is also a downside. “
If Nike and Adidas choose to increase the supply, it will lower resale prices, Powell says. Already, the market is not seeing the kind of resale multiples of even a year ago, he observes. “It will take away the interest of people who were in this business strictly for the economy.”
On the positive side, involvement in resale sites gives brands more visibility in the gray market, which remains a constant problem for luxury goods, Couttigane explains. “There is always an element of scarcity with any in-demand brand, and when these are traded in the second-hand or market environment, it’s hard to know who that customer is. At the very least, partnering with a resale site gives you visibility to that consumer.
Reseller businesses can learn from marketing lessons from auction houses, which are experts at preserving and building emotional connections that engage luxury consumers. As Christie’s Donovan puts it: “The idea is that you come to Christie’s and everything is organized with a specific eye. We are especially careful with brands like Supreme and Nike because we really want to pay tribute to them by supporting them and promoting them without oversaturating the market. We don’t want to downplay the primary or secondary market, and we’re very aware of that just like we’ve been doing with Hermès and Chanel for so many years with handbags.
Eradicating the problem of counterfeiting is a high priority for all parties. The continued success of reselling will depend heavily on improving authentication processes, whether by investing in expert personnel or in counterfeit detection technology.
Resale sites could also learn to adopt a more engaging storytelling, explains Couttigane. “The biggest players in resale are trading platforms, but they are also community platforms that bring people together around a particular brand or range of sneakers.
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