What's Happening?
The fashion industry is witnessing a significant shift as brands increasingly turn to the resale market as a viable growth channel. This change is driven by the rising costs and diminishing returns of traditional digital advertising. According to Faume,
a platform aiding luxury brands in launching resale services, the cost of customer acquisition through digital ads has surged, prompting brands to explore more sustainable growth avenues. Resale not only offers a lower acquisition cost but also attracts new customers, with 70% of second-hand buyers being new to the brand. This model leverages dynamic pricing and premium reconditioning to maintain product value and customer trust.
Why It's Important?
The shift towards resale is crucial as it addresses both economic and environmental challenges faced by the fashion industry. By reducing reliance on costly digital advertising, brands can improve profitability while also contributing to sustainability. The resale market helps avoid significant CO2 emissions, aligning with growing consumer demand for eco-friendly practices. This trend also highlights a broader industry move towards circular economies, where products are reused and recycled, extending their lifecycle and reducing waste. As brands adopt this model, they not only enhance their environmental credentials but also strengthen customer loyalty and brand image.
