Burberry announced recently a partnership with luxury resale site The RealReal, to promote circular economy in fashion and sustainability. Resale is a rising trend within the Fashion as a Service landscape. It’s about nownership and environmental consumption, contributing to increase product lifespan.
Many legacy retailers are supporting circular economy, even fast-fashion brands selling to mass-market customer segments. Burberry is the latest luxury fashion retailer to embrace resale.
In Burberry’s words: “As part of our vision for a more sustainable fashion industry, we have partnered with luxury consignment company The RealReal. By encouraging customers to extend the life of their products through resale, we are working together to support and promote the benefits of a circular economy”.
The RealReal is the leader in authenticated luxury consignment. With an expert behind every item, it ensures everything it sells is 100% real. The company has +100 in-house gemologists, horologists and brand authenticators who inspect all items available online each day. In June 2019, the company went public, being the first unicorn with such business model.
Stella McCartney is another luxury brand that is partnering with The RealReal since end of 2017. If there is a luxury brand that is leading the circular fashion “trend” is Stella McCartney that partners with The Ellen MacArthur Institute, Clever Care or Cradle to Cradle Products Innovation Institute. In 2016, the company was the first to publish a Environmental Profit & Loss Account
TROVE (former YERDLE)
A company that is helping brands to have their own resale market and therefore, have control of their products’ lifespan is TROVE. Instead of using an external platform like The RealReal, Poshmark or Rent the Runway, Trove runs branded resale e-commerce sites (e.g. Patagonia’s Worn Wear) and manages the warehouse logistics, pricing or assortment.
Trove was founded as a California Benefit Corporation in 2012. This is a corporate form specifically designed for social enterprises to pursue both for-profit and non-profit objectives. Benefit Corporations allow corporate officers and directors to take into account the triple bottom line of profit, people, and planet when making business decisions.
Trove’s CEO, Andy Ruben, served as Walmart’s first-ever chief sustainability officer and led the retailer’s e-commerce strategy, private brand and omnichannel initiatives. Today brands using Trove’s platform include Patagonia, Arc’teryx or REI. The recommerce startup from California was amongst the companies awarded during World Economic Forum at Davos in 2018 in regards of the Circulars awards.
Why retailers would prefer to own their resale channel? I feel the discussion goes beyond operations and should take into account strategy and customer experience/ loyalty. If a company business pillar is quality and taking care of its customers all along the product lifespan, I would bet on having in-house capabilities (e.g. have a “white label” recommerce). Resale e-commerce is a way to increase customers while giving a consistent brand experience to this new segment of users. It’s also a way of keeping margins and ensuring that the product is not coming from the black market or grey market.