In response to the growing competition in the resale market, several platforms are now adopting the consignment model to attract luxury sellers. Over the past month, both eBay and Rebag have introduced consignment options on their respective platforms, representing a shift from their traditional selling models.
eBay, historically known as a peer-to-peer marketplace, where sellers interact directly with buyers, has incorporated a consignment feature. On the other hand, Rebag, previously focused on a buyout model, now offers consignment, where the platform takes control of selling the product and compensates the seller upon successful sale.
Consignment effectively blends the financial structure of the peer-to-peer model with the logistical framework of the buyout model, a strategy previously employed by The RealReal and other luxury resale players such as Fashionphile.
Tirath Kamdar, General Manager of Global Luxury at eBay, has described the introduction of the consignment model in September as a significant move in the company’s ambition to establish itself as a major player in luxury resale. He highlighted the growing demand among consumers for a convenient, white-glove service to sell high-end products like handbags.
eBay’s consignment service is powered by Linda’s Stuff, a well-established consignment platform with over two decades of experience in consigning luxury goods.
Charles Gorra, CEO of Rebag, echoed a similar sentiment, emphasizing that the primary challenge for luxury resale platforms has always been the supply of products. To address this, Rebag aims to streamline the selling process, making it compelling for sellers to consign their items. The Rebag consignment process involves sending the product to the platform, receiving a price estimate, and waiting for the sale. The price range provided typically varies by no more than 20%. If the product fails to sell within that range, a new quote is offered to the seller for approval before the item is relisted.
Gorra stated, “We’re maximizing the selling benefits we provide. Now, sellers have a choice: a guaranteed price and immediate payment through a buyout or potentially higher value with consignment, albeit with a longer wait.”
Consigning often results in sellers receiving more money because the platform assumes the risk of buying the product outright. Platforms like Rebag offer competitive rates for consignment, typically around 35%, compared to buyouts.
Despite some challenges, eBay has reported increased revenue this year, while Rebag secured over $100 million in venture capital funding to expand its product catalog and introduce new features, including consignment.
The luxury resale market is expected to reach a value exceeding $50 billion by 2026. As brands introduce their in-house resale platforms, third-party platforms like eBay and Rebag continue to innovate to entice sellers to choose them over direct brand channels.
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