Retail brands are launching resale programs in droves, but some major players are holding back

The resale boom is well-documented, but perhaps nothing captures just how the pace has surged in the last 18 months better than The Recommerce 100, a list by ThredUp that tracks and rates the brands that have the most items listed in their online resale stores:

• Among the top 100 resale programs, 72 were launched in 2022 and 2023.
• Only seven were launched before 2021.

Brands that opened online resale stores in 2023 alone include J.Crew, Kate Spade, and Canada Goose.

It’s undeniably a trend, but some of the trendiest brands have yet to introduce resale programs, including Hermès, Louis Vuitton, and Chanel. Those brands, and others on the resale sidelines, see their products sell briskly on third-party resale platforms like TheRealReal, Mercari, and eBay.

So why are they still holdouts? Will they get to the party fashionably late—or snub resale altogether?

Swatch what happens: Swatch Group AG, which owns brands including Omega, Longines, and Breguet, weighed in recently.

“Swatch plans to stay out of secondhand market,” a Bloomberg headline pronounced in December.

“Why should we mix ourselves into the market of used watches?” Nick Hayek, CEO of Swatch, told Bloomberg. “This is a market that is regulating themselves.”

Andy Ruben, founder and executive chairman of resale solutions platform Trove, found the assertion “a bit surprising,” he told us.

“That point of view is inconsistent with the millions of data points that we have across the brands that are fairly successful and relevant including Canada Goose and Patagonia and Arc’teryx and Lululemon and Levi’s,” said Ruben, referring to brands with resale programs.

Ruben compared the Swatch stance to viewing online shopping as a passing fad.

“That’s a little like the people in 2001 who said, ‘Yeah, e-commerce is fine for those crazy people…but my brand won’t ever sell online,’” Ruben said.

Late arrivals: Karin Dillie, VP of partnerships at Recurate, a tech startup that helps brands launch resale programs, said that brands are adopting resale more quickly than they did with e-commerce.

“Every week, there’s an announcement about another brand in resale,” Dillie told us. “But that’s only really been for the past less than 18 months…And so when you think about how long it took a lot of these brands to embrace e-comm—20 years—this is actually quite a fast adoption of this.”

Plus, Dillie said, even brands that have a resale program on their to-do list have other challenges, including recovering from the pandemic, supply-chain headaches, and surging returns.

“There are so many competing priorities for brands in a low-margin industry,” Dillie said. “They have to keep their head above water, and so oftentimes it is hard to be at the forefront of a lot of these changes.”

But Dillie added that a successful resale program can be a solution to some of those other challenges.

“It can help them with their returns problem, and monetizing items that are slightly damaged, customer acquisition, and loyalty,” she said.

Still, Dillie has been surprised that some outdoor brands haven’t launched resale programs, since brands like Patagonia (2017), REI (2017), and The North Face (2018) were early adopters.

She named L.L.Bean and Columbia as two brands without resale programs.

“Those are some big names in the outdoor space that haven’t engaged yet,” she said.

Cereal entrepreneurs: Luxury brands without resale programs can’t control how their products are represented. If Gucci had a resale site to sell one of its bags, it could use original product photography; on eBay, however, there’s nothing to stop a seller from photographing it on a cluttered ironing board.

“Brands do not have a say in how their items are showing up—that is something that luxury players are, or certainly should be, concerned about,” Ruben said. Similarly, he said, a third-party reseller could be shipping the luxury item “in someone’s Cheerios box.”

One major factor holding luxury brands back, said Dillie, is the challenge of properly authenticating used items to ensure they aren’t fakes. One luxury brand, Chloé, is adding digital ID labels to new products for authentication, and such labels, naturally, vouchsafe the products no matter how many times they’re resold.

“My understanding is that all of them are…watching [resale] very closely,” Dillie said, referring to luxury brands. “They are beginning to lay the foundation within their products by doing things like integrating digital ID so that they can then engage in this.”

One encouraging sign that more luxury brands in particular are seeing the light: Rolex’s announcement in December that it was launching a resale program.

“Rolex jumping in was this huge green light: It’s game on,” Dillie said. “That was a fun day when that news came out.”