The current high sales performance of sneakers has been well observed across the industry, as has the decline of luxury consumer goods. But a new resale report from The RealReal shows that the luxury market is still booming in the consignment arena — especially when it comes to higher-value streetwear.
The RealReal observed that the streetwear trend has resulted in significant growth for the luxury brands that chose to embrace it — in fact, traditional luxury brands saw a 991% increase in streetwear sales over the past five years. This has also been reflected in consignment, with The RealReal reporting 118% year-over-year growth of Jordan, 88% growth of Off-White x Nike and 75% growth of Off-White brand sales in 2020.
Luxury sneakers dominated the category’s most popular items in Q1 2020. Balenciaga’s Triple S Sneaker took the top spot, followed by Adidas x Yeezy 350 V2 Zebra Sneaker in the second position and the Nike Air Force 1 ’07 sneaker in fourth. (The Supreme 2018 Box Logo Waist Bag came in third place.) Of the top 10 items, seven of them were sneaker styles.
“It’s become increasingly clear that traditional luxury houses view streetwear as a force that cannot be ignored, from Dior’s Kim Jones tapping Shawn Stussy to Givenchy welcoming Matthew Williams,” said Sean Conway, sneaker and streetwear expert at The RealReal. “In the past two years, demand for streetwear pieces by traditional luxury brands spiked 486%. The luxury brands quick to embrace streetwear’s influence are becoming some of the hottest brands in resale.”
Previously, there would be an expected delay between the release of product and its emergence on resale platforms like The RealReal. However, recent issues with overstock and the pandemic’s impact on supply chains, plus changing consumer finances, has created an extra glut of product. Additionally, sustainability is a higher priority for many of these brands and their consumers, who are watching to see how they cope with additional inventory.
As a result, traditional retail and resale has become more interwoven, with many brands working directly with consignment platforms. The RealReal has announced vendor partnerships with Phillip Lim, Mara Hoffman and Nanushka in the past two months, with additional brands partnering privately. During the COVID-19 pandemic, the platform reported a 46% increase in items consigned by brands and a 27% increase in new consignors.
While not the expected route for a luxury item, the consignment market can help luxury brands offload excess inventory while also connecting with a new consumer, who may then purchase direct from the brand in the future. High-value items, in particular, have performed better in 2020 than previously. The RealReal attributes this to a growing interest in circular fashion and future resale value.
“Faced with economic uncertainty, shoppers are gravitating toward the safest bets in luxury: investment pieces,” said Sasha Skoda, head of women’s at The RealReal. “They’re spending on high-value, timeless styles with enduring resale value, knowing they can consign them in the future to recoup most of that investment or wear classic pieces for decades to come.”
For sneakers in particular, high-value product saw 1.4 times stronger demand than low-value styles. The highest resale value styles were the Yeezy Boost 350 (+157%) and Off-White x Nike Vapor Street (+111%).