The Pre-Owned Luxury Market Is Booming And Why You Should Care

Luxury brands that have previously ignored the pre-owned luxury market might want to reconsider based on data by Vestiaire Collective & the Boston Consulting Group. They just recently released results from a survey they took talking with pre-owned luxury goods buyers and sellers.

There is still a taboo within large luxury brands about the pre-owned luxury market, sometimes called the grey market, and I don’t think they can ignore its potential for too much longer. This pre-owned segment has shown growth at an incredible rate of an average 12% year-on-year.

pre-owned luxury market boom

This is all compared to a 3% average for the core luxury market which means some brands will certainly need to start looking at other avenues of revenue growth on top of everything else. That’s a no brainer to me.

There’s no sign of a slow down either. The resale of pre-owned luxury goods is forecasted to increase turnover from $25 billion we saw back in 2018 to $36 billion come 2021. This means that the resale of second-hand luxury goods will represent around 9% of the overall luxury market.

pre-loved luxury goods market growth

There are already dozens of successful platforms online, as well as several very large resale groups on Facebook and WeChat for pre-owned luxury goods. Luxury brand’s could certainly claim their share of this growing market with a bit of effort while in its infancy, because this segment will continue to grow larger in the next decade.

Pre-Owned Luxury Market Positives

Luxury companies often stuck their noses up at the thought of selling a secondhand item and that’s completely understandable. It definitely could be seen as something that ruins a brand image in the past, but as we see the times are a changing. The unpublished survey they conducted highlights a lot of great reasons why you should dip your toes in.

These bits of information are based on a survey of over 1005 Vestiaire Collective clients in October 2018, as well on the basis of 12,000 respondents to the BCG x Altagamma survey taken in 2019.

  • Pre-owned luxury buyers are usually consumers who don’t have access to the primary luxury market, as 71% of the pre-owned buyers surveyed lean towards items and brands they could not afford firsthand.
  • Second-hand sellers typically use resale to recoup some of their money back on firsthand purchases, often so they can reinvest in new, full-priced luxury products.
  • The pre-owned market clearly extends the lifetime of luxury products. Most products sold on pre-owned luxury platforms are of high quality, with 62% unworn or scarcely worn.
  • Extensive and unique product offering, changing consumer preferences, accessible pricing and increasing sophistication is driving rapid growth of the resale market.
  • Millenials and Gen Z are disrupting the market and placing greater importance on the social and environmental impact of their purchases than previous generations.
  • Most second-hand luxury clients are attracted by the affordable prices of luxury items: 96% of Vestiaire Collective members surveyed said that they buy second-hand luxury pieces partly because they are looking for value for money.


 
That’s just a few of the highlights the survey found and I think these bits should start setting off alarm bells in the heads of luxury brand marketing departments. I personally would look for a fantastic condition pre-owned luxury item over buying something brand new, especially when it comes to watches.

Ryan Clark
ryan@luxurybranded.com

Ryan is the founder of Luxury Branded and is a branding and marketing strategist for our clients. If you'd like to schedule an hour long free consultation on how and what we can do for your brand then please get in touch.   Follow him on Twitter: @LuxuryBranded Google+: +Ryan Clark as well read his personal blog Luxury BC.

No Comments

Leave a Reply