The power of secondary marketplaces
Future brand growth is in capitalizing on its past
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By 2025, global spend on second-hang clothing will reach $77bn. Total spend on fast fashion is predicted at $40bn, according to GlobalData. Second-hand spending spread to antique shops, furniture, books, jewelry. The pre-owned luxury watch market is set to grow to $30bn by 2025, per McKinsey. There are 154M #vintage on Instagram, compared to 69M #gucci.
Second hand is the first choice.
Desirability and demand for secondary marketplaces is linked to the shift in wealth creation. There is a direct line between the pre-2020 spending frenzy on tourism, luxury fashion, cultural heritage and the arts and the current spending on vintage goods.
Modern wealth capitalizes on the past - of places, objects, institutions, cultural activity and people - and in the stories (histories, heritage, tradition) associated with them. Growth is in reviving past, ascribing it importance through a half-real-half-imagined narrative, and turning it into an investment asset.
The wealth-mongers of this economy are curators, collectors and creators, who have the power to increase any past thing’s value by linking it into a collection, curating it, and remixing it with the current items and vibes.
This process is not limited to things. Buildings, neighborhoods, cities and regions all can be (and are) reinvented. A couple of years ago, a Chanel perfume advertisement leaned into an invented tradition of jasmine gardening in Grasse, where jasmine artisans passed their craft over generations. Lower East Side of Manhattan, High Line or Williamsburg have gone through numerous narrative filters. In the process, Grasse and Williamsburg acquired previously missing heritage and touristic magnetism.
Looking to the past is a lucrative shift. Economically, value is extracted over and over again without production costs. Culturally, value is created through democratization of collecting, curation and creativity, generating endless commercial opportunities. Socially, inequalities created by wealth and access are accompanied by the new ones.
This economic, cultural and social shift impacts brand strategy. When we change how we buy things, we change what we buy. Secondary marketplaces usher a new wave of talent into traditional fashion organizations: storytellers together with strategists, curators and merchandisers, archivists and stylists, collectors and designers, vintage dealers together with traditional sales channels.
Here are five key considerations for brands on how to use the past right:
Invent a story. Past is valuable because it differentiates a brand from everyone else. When the past or the heritage doesn’t exist, it can be invented. Ralph Lauren empire is built on an invented story. Coco Chanel’s story has been enriched and expanded and turned into a heritage. So was Louis Vuitton’s. Heritage comes from people, but also from neighborhoods and provenances. “Made in France” is linked to the story of French cultural activity and heritage. “Made in Detroit” was also linked to a heritage until it turned to be at least partially fake. Attaching a new or the existing brand to the past differentiates its products from commodities (a commodity, like a BooHoo t-shirt, doesn’t have a story).
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