Coach Inc.’s financial performance might not be as stellar as it once was, but the brand is as hot as ever in the secondary apparel and accessories market.
That’s one of the findings of a new report by Poshmark, a secondhand shopping app with millions of users who upload millions of dollars of inventory daily. Coach is both the most popular designer brand and the most popular handbag brand for women on Poshmark, who, on average, are selling 18.9 items on the platform at any given time.
Brands joining Coach as the most popular designer brands to resell are Louis Vuitton, Michael Kors, Tory Burch and Chanel. Teen brands that top the secondhand list are Forever 21, American Eagle, Jeffrey Campbell, Abercrombie & Fitch and Brandy Melville, and edgier designer and contemporary brands that are coveted on the secondary market include 3.1 Phillip Lim, Alexander Wang, Balenciaga, Vince and Rag & Bone.
“Some of the findings are very much a reflection of what we see in terms of broader brand awareness in the market. Some of them have to do with price arbitrage. Other brands are more trending brands,” explained Manish Chandra, chief executive officer of Poshmark. “If you look at a brand like Brandy Melville, it is a new, trending brand in America. We started to see it last year catching up in sales volume, and since then, we have seen it skyrocket. Some are very established brands. Coach is one of the largest brands in America, and it is no surprise that it is one of the largest brands on Poshmark.”
Chandra added, “It isn’t any specific segment of fashion that is being touched by the secondary market phenomenon. A lot of people think it is only touching high-end designers because people are looking for a discount, and some people think it is low end, but it is touching every segment in a meaningful manner.”
Clothes are the largest fashion category within the secondary market on Poshmark on the basis of item volume. However, in dollar volume, handbags are the winner. In addition to Coach, Louis Vuitton, Michael Kors, Gucci and Chanel make the list of most desirable bags to be bought secondhand. For skirts and dresses, J. Crew, Anthropologie, Free People, H&M and BCBG Max Azria are popular.
In the jewelry and other accessories category, David Yurman, Tiffany & Co., Ray-Ban, Kate Spade and Michael Kors are the brands that secondhand shoppers want. When it comes to designer shoes, the sought-after brands are Tory Burch, Coach, Christian Louboutin, Gucci and Michael Kors. Across all categories, the five brands that sell their goods the fastest on Poshmark are Lululemon, Louis Vuitton, Brandy Melville, Frye and Longchamp.
In 2013, Chandra estimated the secondary apparel and accessories in the U.S. generated at least $1 billion in sales with eBay capturing $500 million to $700 million of that total. Start-ups like Poshmark, The RealReal, Walk In My Closet, Tradesy, Vaunte, Threadflip and Twice still command a small piece of the pie, but they are poised for growth. “This is going to be a pretty good year — a high, high growth year — and in 2015, I think we will talk about the impact of this business on the overall fashion market,” said Chandra.
He argued the availability of digital tools to widen participation in the secondary apparel and accessories market is changing how consumers think of full-price goods. “Now, a woman can participate in a brand, and it has residual value to her. That can change the fashion market in fundamental ways,” said Chandra. “We are starting to see that girls are willing to pay more for an item because they know they can sell it after wearing it a couple of times, and that is huge.”
Poshmark’s report also examined days and times that are heavily trafficked. Friday night is prime time for selling and buying used clothes. “People are getting their paychecks on Friday, which leads to Saturday being a huge day for retail in stores. On mobile, that time is being shrunk down to the second half of Friday being huge,” said Chandra. About 90 percent of Poshmark’s sales occur on mobile devices.