Resale Fever

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1:13Hello and welcome to Fashion People. I'm Lauren Sherman, writer of Puck's fashion and beauty memo line sheet. And today with me on the show, I am talking resale with The Real Real's Kristen Naiman and a whole cast of characters. It Girl author, Marissa Meltzer, vintage expert, and also an author, Erica Verink, and Puck's very own retail correspondent, Sarah Shapiro. Before we get going, I wanted to remind you that if you like this podcast, you'll definitely love Puck where I send an email called line sheet. If you're a fashion person, you get that reference. It's an original look at what's really going on inside the fashion and beauty industries.

1:56Line sheet is scoopy, analytical, and above all fun. Along with me, a subscription to Puck gains you access to an unmatched roster of experts reporting on powerful people and companies in entertainment, media, sports, politics, finance, the art world, and much more. If you're interested, listeners of Fashion People get a discount. Just go to puck.news slash fashion people to join Puck or start a free trial.

2:24Happy Friday, everyone. I am actually recording this very early on Friday morning, live from Milan, where I'm having a great time. It's always very fun here, but this season has been, I'd say, especially fun. I just got back from the Max Mara dinner. Thank you to Judgy. no surname needed for having me. You all know who I'm talking about. This is her second fashion people shout out. Apparently I think it's probably her third and she just hasn't heard the other one, but, um, it was really fun. And also my seat mates were great. I am so happy I went and the food was good. I also saw Prada today and Porio Armani shout out to green and Anushka who was holding court.

3:06And I messaged a friend and said that Anushka is nothing short of spectacular. It was an emotional day for them. Obviously, this is the first show they've done since Mr. Armani died, and it was a really good show. Anyway, I saw Jill Sander yesterday, Gucci the day before, Versace later today. I have a very special guest early next week to discuss the best and the worst of the Milan shows. One of your all-time faves, so get excited. I don't want to say too much. We're going to save the conversation for next week. In Line Sheet this week, you'll find some of my runway takes, but I also covered the news that Natalie Massinet and Eric Tortsenson, Tortsenson, wow, I did that right, I think, big characters in the Line Sheet universe are withdrawing their respective lawsuits against each other.

3:57So congrats to them. I have a little analysis on that, maybe more in the coming days, maybe not. Plus, I take a look at the situation with Amy Griffin, the investor behind G9 Ventures, which has a stake in a ton of brands we write about. Goop, Goop Kitchen, Rose, Spanx, Atelier, Studs, pretty much everything. At least everything that, you know, Sarah writes about, but, and Rachel, but like, yeah, a lot of stuff. Anyway, on running and aura ring too, et cetera, just tons of things. But Amy was the subject of a pretty major New York times investigation this week that questioned the validity of some of the claims she made in her very popular memoir, the tell, uh, you might have already known that because there was a ton of stuff on Reddit, those types of forums online.

4:51But Times Piece was really interesting. And I originally just thought I'd do a little item on it, but then it became bigger because I think the role she plays in the business and society and all of that, it has a lot to do with what we write about in Line Sheet. And so I put it, try to put it in a little context. I hope you enjoy this conversation that I had at the WSA building about why people shop secondhand and how it's changing the business of fashion a lot. Uh, I'm really fascinated with this topic. As you'll see, I get into this idea of the customer journey, which is like a very wonky marketing term, but I, I truly believe that access to secondhand has totally changed how we think about buying stuff.

5:48And it's important. Today, I wore a Raf Simmons Jill Sander blazer to the shows. I got it on the RealReal like a month ago. It's just, it's really changed. It's changed our lives. And so we talked about a huge thanks to the team who joined me on stage and obviously the RealReal and Kristen in particular for helping us organize it. And thanks to everyone who came out. It was great to meet a lot of you. Next time we do one of those, I'll be more available to meet and greet. It was a kind of a hectic week, but I hope to do one again soon and I hope you enjoy this.

6:29Today's topic is the state of resale. It's brought to you by The Real Real. And yes, Woo! We all use the RealReal probably too much. We love it. And so they just published a resale report. We probably will end up talking about this, but it is a fully editorial panel. I also encourage everyone to talk shit about the RealReal at the same time. But I'm just kidding. Anyway, I thought it would be good for each of you to introduce yourselves and talk about what your relationship is with resale professionally and then personally. And Kristen, maybe we can start with you. Hi, I'm Kristen Naiman. I'm the chief brand officer of The RealReal.

7:15And my relationship to resale in a professional way is deep and daily. But I think my relationship to resale, even professionally, I think is rooted in something very personal, which is that I've spent my whole life being a really deep lover of secondhand and vintage consignment. It's like my first love in fashion. It's like was my road into fashion. It's how I learned about it. And it's the thing I always go back to. And it's been a really amazing experience to help really tell that story and look at this business as not just a disruptive business within the state fashion and where we are today, but actually one that's like a future thought leader forward idea about how we're all going to shop as things move on.

8:04My name is Marissa Meltzer. I'm a writer. I wrote about the real real in a New York Times style story a long time ago where I wrote about the real real and Poshmark and various other companies. and I wrote about one of the head authenticators from The Real Real maybe two years ago. But mostly I'm just someone who shops a lot and who has a bad relationship with money and financing. And The Real Real is part of my life. I think except for my shoes, everything today, including the bag that you can't see that's in the back room, it's an Hermes Kelly from the 50s, was bought secondhand pretty much.

8:55So, yeah, it's part of my lifestyle and part of my entertainment because I'm not interested in sports. I'm Erica Verink. I write a mostly secondhand fashion subset called Long Live, and I've been thrift shopping since I was 15. So it feels like my formal education is in secondhand resale. But definitely like the less glamorous version, like Goodwill's in Iowa kind of thing. Hi, I'm Sarah Shapiro. I'm the retail correspondent for Puck's Line Sheet fashion and beauty memo newsletter. I am very interested in resale from a consumer and retail perspective. Being one of the parts of the business has really been disruptive in the past few years.

9:48I'm in the Bay Area, very close to the RealReal corporate headquarters. And I find that just like very interesting how they've went from being like a single store to completely changing the way that we shop online and went from consignment being something you would maybe like whisper or like you had like a strange aunt who you knew would go into these stores. How many RealReal stores are there? There are now, there are 16 and we're opening a few more. and seeing the personalities like I recently wrote about this but I love seeing how people treat resale so whether it's I sign stuff or I buy stuff and I can sign I think there's so many different levels to that so I find that really interesting me personally I feel that I'm a passionate but selective hoarder.

10:44So I will buy things, but I do not get rid of things. But I do love shopping The Real Real, my blazers from The Real Real. As is mine. And I definitely wanted to wear something secondhand, but most of the stuff I bought is from The Real Real because it is, I remember Julie, the founder, interviewing her in 2012 for a story about where all these secondhand sites and vintage sites that were being heavily funded. And she said to me, we raised the most money and we're going to be the most successful. And she was right. But it allowed the RealReal to scale more than anything. Obviously, there have been challenges along the way, but it is remarkable to me.

11:30I try not to use a lot of jargon, but when you think about the customer journey, it has truly changed, especially when it comes to luxury goods. Like there is, and Sarah, I'm curious, you were a buyer for a long time. It used to be that you stopped, you bought the item and you stopped. And maybe you resold it if it was really high end and you had a store nearby that you liked. But now it's part of the thinking when people are purchasing things. What have you observed from your time as a buyer up till now covering this stuff of how secondhand has sort of been baked into the way people shop every day for luxury goods in particular?

12:17Yeah, I mean, to quote the RealReal report, back to you, it was 47 % of people consider the price of the resale item in luxury, I think it was ready to wear before making a purchase. And you're also seeing this whole secondary market of other businesses popping up to like help you, you know, have a widget in the corner that tells you before you purchase this item, this is how much it could be worth later. I mean, we're seeing items, even with Hermes to reach a quota bag, you're buying other items, and then reselling those other items just to be able to earn your spot to buy the bag. I mean, there's so many different layers and levels to this that are really interesting.

13:03And for me, I also often think of it like buying a used car. They say the second you drive the car off the lot is when it depreciates the most. And sometimes I think of that with fashion is like, if it's already going to depreciate as soon as I wear it out the door, like resale is a great starting point. So you're not paying for that upsell. So that's like one way that I've started to look at it and how it impacts the industry. Marissa, you are publishing a book about Jane Birkin, a biography called It Girl coming out. Out October 7. Please pre-order. Marissa will be coming back on Fashion People again.

13:46Yeah. Whether you want me or not, I'll be back on Fashion People. Well, yeah. How much do you think Hermes and the Birkin in particular and that that whole experience on the resale market has influenced people being comfortable buying other stuff, too? Like, to me, that's sort of where this all started. Yeah, I mean, Hermes has this, I think one could generously call it opaque, labyrinthine sort of schema of shopping where there's all these unwritten rules of like, do you have to spend the equivalent of a Birkin or a Kelly in order to get offered one, which is such pretentious language. And resale has really sort of, you know, bypassed all of that by allowing people to buy a Birkin or a Kelly or a different Hermes bag simply because they want one, because they have the money to buy one.

14:54And I think that, yeah, it's sort of bypassed the whole process. Hermes as a company is weird and will never comment on it. But I do think it's sort of thrown something into their whole process of selling in that, you know, it used to be you had to sort of dote on a sales associate and buy all the requisite things. And now you could just go to Fashionphile or the Real World, of course, and, you know, buy the Hermes or Kelly bag or Birkin bag or Picotin of your dreams, which I did from Risi. And, you know, shout out to Sophia Bernardin from Risi, whose office is here and who's here today fresh off the plane.

15:51Bless her.

15:55Hi, I'm Madison Tevlin. And I'm Presley Hossbock. We're the co-hosts of Serving Smiles, a podcast where we try to make health and wellness way less overwhelming. In partnership with Colgate Palmolive, we're breaking down topics like oral health, skin health, and more with the help of expert guests. Check out Serving Smiles wherever you get your podcasts.

16:18Kristen, I want your sort of big picture from the inside point of view on all this. But Eric, I wanted to ask you quickly. Let's talk about young people and how they think about secondhand. Because when I was growing up, we used to go thrifting. I had friends who wore vintage prom dresses or vintage dresses to prom. But we were like weird. And we didn't do it a lot. Like I would have never bought a pair of shoes on secondhand. I would have never. There were a few kind of small, very 50s, 60s vintage stores and then there was Goodwill. How has it changed for Gen Z and a lot of millennial shoppers too on how their process works when they're thinking about what they want to buy?

17:09I think for a lot of shoppers, it's a source of pride to be able to say, I found this on The RealReal. I got it for 10 % of its retail cost. But I also have a lot of friends who collect quite seriously and they treat secondhand or vintage shopping as collecting assets, which might be a little complicated. complicated, but like they're not buying real estate. So they might as well, you know, buy a Chanel bag and then refer to that as an investment piece. But that language, I think, has become way more popular in my friend group. Kristen, how long have you been at the RealReal for? A little bit over 18 months.

17:45Okay, so you're still really new. What did you think about how people shop the site and shop secondhand generally before coming in? And how has that changed for you? You know, I think I was like a huge lover of the real, real massive customer and had actually been in touch with Rati like seven years before I started. And I had written them a fan letter, her and Julie, like literally on LinkedIn and was like, I think you guys are like the future of this whole thing. I think what you're doing is really transformative because to me, what I had never seen before as somebody had been shopping at Goodwill is like in high school and then Upper East Side consignment shops.

18:23As I moved through my life, consignment and resale was something that... Resale, resale. As someone who lives a lot. Well, cancer care forever. Yeah, cancer care forever. Yes, I love that one. That whole stretch. I had a friend and I used to go in high school and college, and we were just like, hit the whole stretch. That is the truth. So I ended up, you know, I saw very quickly that for someone like me who loved that process so much, to see people doing it at scale and the way that it was being done was going to be really transformative to its possibilities. Because we, like I now know, working there, that like your average company moves 200 SKUs through their system a year, like Nike, right?

19:06It's like, whatever. One of those might be a pair of Jordans, but it's like per SKU. We move a million through a month. And that's connecting. So if you think about that, like from a people perspective, it's like that's connecting one individual person who wants to part with something to one other individual person who wants that thing, one million a month. And I think that that, to me, creates a level of possibility and a scale for something that actually is like our most one of our most ancient behaviors. Right. Like it's kind of like this thing, like the best ideas in the world are never new.

19:37They're like reinventions and new delivery systems of something really fundamental. And I think there's something very like tender about something that's had some life in it. And I think that in the world we're living in today and what we're going through, I think people really crave that. And I think it's transformed how we engage with what we are calling consumption. You know, I mean, I think it's a different way to engage with stuff. Yeah, I want to talk a bit about how it's benefited big fashion and big fashion brands. And Marissa, you touched on this for a minute with Hermes, but I think of it in the way Canal Street looked.

20:16The luxury brands don't like that. But in another way, it exposes those brands to people who might have never touched them before. And now you would sort of enter a luxury brand through fragrance or a keychain or whatever, but you can probably have something real if you save up a little money. It might be cheaper than a pair of sneakers if you're smart. I think I have an Hermes, a Margiela era Hermes tote that I think I paid$400 for on the RealReal. I mean, it's criminal, but it's amazing. And then I ended up buying a more expensive Hermes bag. It's still not that expensive. But, you know, the point being that it gets you in the door.

21:04What do you all think about that? And what is, is there a tipping point where, you know, there are so many secondhand never fools available that like it's harder to sell the full price ones? Like, feel free to jump in. I'll jump in for a second. And the last point about, I think there will continue. I don't know if the percentage of people will change. I do think there will always be a customer who wants that first experience or wants an experience at some point to be fresh, new, never bought, go into the store and have that experience. I think what the one of the more interesting details with consignment is that the brands no longer like have that control.

21:53So with beauty, they still had maybe it was through Estee Lauder or, you know, through some of the other brands, but partners. but they still had them pull in there. Same with sunglasses. They were maybe licensing out their name, but they still had sign off on the visuals and some relationship there and a partnership. With consignment, they don't at all. Number one, with consignment, you can sell an item over and over and over again. And that handbag, for example, will keep making money. The brand won't get any of that. They get it the first time and not again if they're not owning that relationship.

22:29Additionally, You are maybe having a connection with the RealReal and their customer service. And maybe you're having a great experience, but still that brand doesn't, they have a little bit of that connection, but it's not the same level when they go directly. And that's what I think is interesting there is if the brands are going to say, hey, we're missing out on this. Some of them have, but I feel like not in a big way yet. One thing I've always felt really bonded to with the RealReal report is the idea of fair condition and that, you know, that's the sort of well-used condition of certain, you know, clothes and bags.

23:11as an entry point into a new designer. I've always been someone that loves a beat-up bag because I feel like then I'm less kind of ginger with it. And, you know, it's sort of done the hard work before me. And it also, as an added bonus, is much cheaper than kind of a mint condition bag. And you see that with Hermes and Chanel and Louis Vuitton. And it's a great way to sort of enter into a higher echelon of designer. And yeah. I think to build on that too, it's like there's this sense that somehow because the brand is not owning the relationship with the second and third generations of purchase, that somehow it's taking something away from them.

24:00But actually there's a lot that we see that shows that keeping those products in circulation and the desire high for them fuels the desire for the main direct primary market relationship. And so I think there's something too small about the way brands look at it if they think it's detrimental. I think that there's a much bigger system that can be created that actually, you know, one of the things we see a lot is like prices being driven up for exactly the reasons you guys were talking about, which is like, I'm going out into the primary market and I need a dress for this event and I can buy the row or I can buy X middle market brand.

24:37I can pay this amount or I can pay that amount. We're really hearing people say and talk about this idea and they're telling their luxury managers and people that come to their houses to collect their stuff that they chose the row dress because they know, because they've been told that the resale value is higher, it retains it better. So in this Kelly Blue Book way, you're like, if I think I'm going to wear that dress four times, then it might make more sense to pay double for it because I might get, you know, two thirds of it back if it's the right brand and the right choice. So there's a level in which for certain brands, it's actually fueling.

25:11And I think that that adjustment in the viewpoint is coming and beginning because the customer is seeing it. I think the brands aren't really seeing it yet, but I think they will because the customer is behaving. Sarah wrote an item when Michael Ryder's Celine debut happened that in resale there was a lot of interest in Phoebe's Celine bags and just Celine in general. I bought a Celine box bag on the RealReal in lipstick pink. Yeah. Maybe it's yours. Was it lipstick pink? No, mine was ivory. Yeah, that's more you. And it was totally inspired and the line sheets just came in to the stores for the first his first collection and I'm totally buying one of the shirts like I for sure am and that made me excited about the color and all all of that what do you think Erica what do you think the customer feels about does does it help burnish the their relationship with these brands I think there's like one example I can point to in my sub stock in particular which is a few months ago, I wrote a letter just about secondhand, beat up, monogrammed Louis Vuitton print.

26:27And for a lot of my readers, it was kind of like a rediscovery of that print. And it's so approachable, like the price point on like a little keychain or a tiny bag. And the feedback I got was, I can't wait to buy this tote as a work bag. I wouldn't feel afraid to throw it around. I love how it's already worn in. It's so Olsen twins, et cetera. So I think that people feel empowered to approach brands that they would otherwise be nervous to like meet a sales associate and accept a glass of champagne from. I think there's also an element to build on that, that it's like their brands have different eras, right?

27:06And to your point, it's like there's this, there's the Phoebe and then there's the, you know, Hedy and then there's that, right? It's like as it goes. Hedy's is Hedy's alone as he has said on Instagram. But either which way, what happens is that those eras are all kept alive on the RealReal. And so there's also something that happens from it keeps the heat up and it keeps the interest in those different eras up. And you can argue that brands stay alive. Like Drees is a really good example, right? It's like Drees has such a devoted customer and that customer had such a particular relationship with Drees.

27:38And there's we saw a huge spike in Drees after Drees retired. And we see a range of spikes when when creatives retire. But I think that that reality makes it so that the discoverability actually allows for things like the Michael Ryder thing to get hotter and bigger faster because there are people already in there looking and people discovering stuff. the um the chloe paddington we saw like a steady rise of that over like the six to eight months before they re-released it on the market on the runway excuse me and then and then it you know sort of crescendoed and it's been up ever since but like you know if designers are taking the cultural temperature the cultural temperature is happening anyway and we're already like seeing it on the real real and so actually it helps those designers because the momentum already builds and By the time it's out there, the desire is hotter.

28:26It's higher. I love the idea of sort of arbitrage of bags. This is going to be very name droppy, but, you know, think of it as my like glorious life that you get to participate in. And I don't I have to pay for my own health insurance. So I I was in Venice about a week ago profiling Marc Jacobs and Sophie Coppola. It's on The New York Times now, blah, blah, blah, blah, blah. and I mentioned that I had one of the Louis Vuitton, Marc Jacobs, Sofia bags, which is sort of like a sort of redone speedy that can be purchased for a pretty good deal on the real world, considering how gorgeously made they are.