5 Myths about Recommerce Programs (for brands)

5 Myths about Recommerce Programs (for brands)

1. Cannibalism

First off, anytime somebody claims something to be 100% of anything, you should question it.?But in our experience, the belief that a resale channel will cannibalize sales from your mainline channel is 100% false.?Every recommerce program that we have been a part of here at Maven Circular follows the same predictable pattern: the brand asks their storefront provider to produce detailed analytics to track cannibalism, and then 30-90 days later they forget all about it as they see the overwhelming contribution the program is making to their bottom line.?Calculating mainline cannibalism is witchcraft at best.?You can’t A/B test consumer behavior in the recommerce shopping experience.?Here’s what we know for sure: the resale market already exists.?It exists in several marketplaces: eBay, Poshmark, Craigslist, Facebook, the list goes on.?Launching a branded resale channel is simply wrapping your arms around a market that already exists.

2.?????????????Brand Damaging

A common reservation that brands hold, but don’t like to say out loud, is that they are concerned that selling “off price” products will damage their brand perception.?That is a load of crap.?Sorry, not sorry.?All it takes is one employee at a landfill or textile reprocessing facility to snap a picture of your company’s brand-new product being shredded for you to now be a contributor to apparel’s “throwaway culture”.?Right now, consumers are voting with the dollars in support of brands that are launching circular programs.?In the very near future, any brand that doesn’t have an off-price channel will be perceived as obtuse at best.?Furthermore, to our previous point about cannibalism, when you “wrap your arms” around that secondary market that already exists, you actually create a better customer experience for those consumers who have already made the choice to buy second hand.?By selling authenticated product backed by your brand equity, you’re creating a superior experience that will only enhance your brand’s perception.

3.?????????????Expectations Will Be The Same?

Also, false.?One benefit that brands see almost immediately is that when merchandising product in their second-hand experience, even the most spoiled of ecommerce guests are willing to purchase with a different set of expectations.?Premium brand programs like lululemon’s like new and The North Face Renewed are charging for shipping even though their mainline sites do not.?Recommerce programs are operated out of a single fulfillment center - meaning longer transit times to many guests.?And return policies - well you can plan on paying to return your used item.?The point is this - customers know they are buying used, and somehow that gives brands a bit of a “pass” in that they can make decisions that enhance the economic profile of a secondhand channel while still spoiling their mainline guest.?And because of that, charging for shipping and operating with different fulfillment SLAs is also not brand damaging.

4.?????????????A Picture Is Worth A Thousand Words

A true statement.?However, in the context of your recommerce program, a picture might not be the most helpful thing for a customer trying to make a buying decision.?Now, don’t get us wrong, we LOVE companies like Orbitvu who has developed an absolutely killer solution for automated product photography (ideal for recommerce environments).?But we’re not convinced the data is there to suggest that original item photography is required.?A perfect example is Patagonia’s Worn Wear program.?This program, powered by Trove, utilizes original photography for all their garments.?But you can also buy used Patagonia gear through REI’s ReSupply program.?The exact same gear, inspected by the same people (Trove), sold in the exact same way - except - REI uses catalog imagery.?Both programs are wildly successful, and used Patagonia gear flies off the digital shelf.?But one program has a significantly higher cost due to the inherent cost of photography.?It’s our opinion that brands should get the most mileage out of their existing digital assets.?The one exception here is for “remade” collections - where companies like Tersus Solutions work to “upcycle” garments like they do for Alps & Meters Mountain Memories collection.?This bespoke, handmade garments sell at a premium and deserve (and require) original production imagery.

5.?????????????This Model Will Work For Any Product

Sorry, but no.?No it won’t.?It’s not our place to say whether or not a product or a brand should exist.?However, if you make a product that is of such an inferior quality that it simply cannot sustain a second life, or you sell it at such a low price point that the economics of simply don’t make sense, then there’s a good chance that your product contributes to the “throwaway culture” we discussed earlier.?If you make a quality product, one for which there is strong demand, then the market will reward you by supporting your resale channel.?And that the market rewards you in this way says something about the continued opportunity you have to make a positive impact on the environment.?Quality begets quality.?Consciously made, high quality products have the ability to be additive instead of destructive, and that is a business model we all can get behind.