Japanese luxury goods resale platforms partner with Alibaba in China
Key points to remember:
Bain & Company estimates that the second-hand luxury market reached $ 2.69 billion (17.3 billion yuan) in sales in 2020.
Wealthy Chinese consumers are cleaning their closets of designer accessories and luxury items to live happier, more productive and more organized lives.
Many millennials and Gen Zers adopt a minimalist lifestyle in which they follow Marie Kondo’s principles of decluttering.
China’s perception of second-hand luxury is changing. But despite significant growth, the market is still a very profitable fraction of the luxury sector. Bain & Company estimates that the pre-loved luxury industry reached $ 2.69 billion (17.3 billion yuan) in sales in 2020, compared with $ 53.71 billion (346 billion yuan) in sales of new luxury goods during the same period.
There is still a long way to go before second-hand luxury takes hold in China and becomes a mainstream phenomenon similar to that seen in Japan. In the Land of the Rising Sun, second-hand luxury goods sales account for 28% of the global luxury market, compared to just 5% in China, according to a joint report from the China University of International Trade and Economics and Business. Isheyipai. Yet smart retailers and high-end brands operating in China are already making the most of their situation by raising “tens of millions of US dollars” in Series C funding, like GoShare2, or teaming up with corporate giants. technology like Alibaba when they enter China.
According to a Alizila press release, Japanese vintage and second-hand luxury shopping site Brand Off has partnered with Alibaba’s cross-border marketplace, Tmall Global, to expand its presence in China. “China is like a gold mine,” said Yuya Yamauchi, CEO of Brand Off.
Yamauchi’s assessment is correct. As the world’s second largest retail market, China entered 2020 with a $ 5.8 trillion in opportunity. Additionally, Chinese consumers have become a major driver of global consumption, and their passion for luxury has boosted consumer spending.
But globally, a young, progressive and socially motivated demographic is rebelling against blatant forms of consumption. They lament the emotional disconnection between individuals and refuse to spend their lives simply hoarding things up. Additionally, many millennials and Gen Zers embrace a minimalist lifestyle, following Marie Kondo’s decluttering principles. And in the post-COVID-19 era, this social movement has become a phenomenon in China. Wealthy Chinese consumers are shedding their closets of designer accessories and luxury items to live happier, more productive and more organized lives.
“For Japanese second-hand luxury goods retailers, all the clothing, bags and jewelry that languishes in consumers’ closets across China represent an opportunity that is becoming too big to ignore,” said Christine Chou, editor of content for Alizila.
Before the global pandemic, retail stores like Brand deactivated have developed methods of acquiring and retaining Chinese consumers. But today, they see China as a two-sided market. Changing consumer behavior has pushed restart platforms to embrace the new normal, where the upper class is no longer exclusively the buyer but also the seller.
According to CNBC, the pandemic was a trigger that prompted “even more people to consider the future of their closets.” ThredUp’s 2020 Resale Report estimates that 50% of people are cleaning their closets – more than before the pandemic.
“We have seen a big increase in supply, with many people spending more time at home looking at their full closets and looking to earn some extra cash,” said Anthony Marino, President of ThredUp, on CNBC.
Perceptual resale platforms such as Brand Off have adopted best practices to reach Chinese financial class faster than their global competitors. Instead of bemoaning the missed opportunities associated with closing borders, Brand Off used its deep understanding of the Chinese consumer to expand in China.
The Japanese luxury goods reseller has renewed its relationship with Chinese consumers by setting up shop in their own country. And it boosted brand awareness through live streaming sessions during 6.18.
Brand Off’s exceptional live content featuring the company’s own sellers boosted the brand’s popularity and helped the Japanese player understand consumers’ buying motivations.
We estimate that throughout 2021, additional resale platforms will go all-in on China, trying to access a critical market, rich in opportunities, but where habits and consumption patterns are increasingly westernized. more.