COVID-19 is an accelerator. In fashion, it speeded the transition to digital technologies and expedited the demise of traditional department stores. Both movements were underway in the Before Times, but the coronavirus catalyzed them. Luxury resale is a category that was trending upward pre-pandemic and now it’s proving resilient even as the luxury business in general is down.
Rebag, reports founder and CEO Charles Gorra, is up 50% year over year with most of the growth coming from its online channel. Having raised $15 million in a recent round of funding—“no easy task in this environment,” he says—Gorra is now adding accessories and small leather goods to the company’s handbag offering. As of this morning, Rebag customers can scoop up an Hermès scarf when they buy a Birkin, or choose a monogrammed wallet to match their Louis Vuitton Neverfull. “This gives us a price point that we didn’t have,” says Gorra. “The average bag is four digits, and these accessories are in the $400-500 range. That’s still expensive, but it will help us talk to a new customer.”Louis Vuitton keychainPhoto: Courtesy of Rebag
Even better for fashion-obsessives looking for value, Rebag’s exchange program has been expanded to include the scarves, sunglasses, wallets, and keychains now shoppable on its ecommerce site and at its Soho store. That means, for example, that a pair of new-to-you shades from Rebag can be sold back three months later for 80% of their value. A $300 style winds up costing just $60. The company’s online appraisal index—which generates the resale value of the bags in your closet and has been a boon to the business, automating a process that used to require a store visit—has been expanded to include the small accessories, too.
That Rebag (and its competitors, presumably) are seeing an increase in buyers amidst the COVID recession is no surprise, but Gorra anticipates more sellers, as well. “In luxury resale, we’re typically supply constrained; we can sell every single bag we find. The question has always been where are we finding it?” he says. But the lockdowns have shifted things. “Only one out of 10 current owners is reselling, he begins, “nine out of 10 are doing nothing. Now though you’ll have people jumping on the resale bandwagon. You’re at home, you’re looking to make a little more money, you’re pushed by default. Most changes, that’s how they happen. There’s some externality.”Celine sunglassesPhoto: Courtesy of Rebag
Are more changes in store for Rebag? Is apparel next? “There’s certainly a big need because of the volume of apparel available,” Gorra says. “But for our model it’s not exactly suited.” Rebag, unlike other popular resale sites, buys its goods, taking substantial risk on inventory and pricing. There’s also the issue of variability. Clothes don’t hold their value like accessories do. The trends change quite often and now there’s sensitivities around COVID-19 to consider. Still, Gorra says “never says never.” As for trends, it’s classic bags that are selling at the moment. “Everything at the fringes is definitely more challenging,” he elaborates. Those Hermès scarves uploaded this morning won’t last long.