Case study co-written with The Amanqi Edit.
Despite these difficult and challenging times, it is important for businesses to adapt and meet their consumers' needs. Here's looking at how luxury resale platform, The Luxury Promise was able to do so successfully.
Online collaborative consumption, a method of shopping that entails buying and selling second-hand used goods, has been on the rise amongst younger shoppers due to the convenient ways that users can “overcome financial restrictions, invest in their passion for thrifting and hitting good deals and last but not least, partake in a more sustainable way to shop,” according to ESMOAR World Research via Warc.com. Founder of pre-owned luxury goods platform, The Luxury Promise, Sabrina Sadiq, elaborates on how the business operation touches on the above points in the below case study.
Dubizzle, UAE’s online classified platform has revealed that six out of 10 of its users have engaged in secondhand shopping in the first half of 2019. A survey sent by Global Retail Alliance, identified that a quick motivator to sell in the used market would be earning instant cash, however Salma Anabtawi, Head of Customer Experience at Dubizzle thinks that we must not forget about environmental benefits; a point that a majority of younger shoppers such as millennials and Generation Z consider when shopping.
Meet brands’ most coveted target audience: Generation Z. Born between 1995 and 2010, this group was raised ‘digital’ both at home and in school; therefore, it comes as no surprise that they would be research-savvy when shopping online. When it comes to money, they depend on allowances, summer jobs or their parents so their budget typically is limited, especially in the Western cultures. The Millennials, born between 1981 and 1996 are considered young to mid-aged adults who are most likely saving for family planning or asset investment purposes. In their late to mid thirties, they could be typically found thriving in a new startup or entering into mid-level managerial positions. Hence, spending with purpose is a factor brands must consider for both age groups.
With access to ample reviews, and their internet-savvy nature, younger shoppers assess brands “according, first, to the (perceived) quality of their production, and then to their transparency and ecological commitments,” states Global Retail Alliance ME.
In the below case study, we witness how Founder of pre-owned luxury goods platform, The Luxury Promise, Sabrina Sadiq was able to target these young shoppers in an effective way through earning external support.
I. Case Study Summary
Despite these difficult and challenging times, it is important for businesses to adapt and meet their consumers' needs. The below case study depicts how luxury resale platform, the Luxury Promise was able to do so successfully.
II. The Background
As a platform dedicated to connecting pre-owned luxury goods with our customers, Dubai and London-based The Luxury Promise, enables consumers to shop luxury products - in particular sustainable handbags. Creating multiple channels for its consumers to buy and sell pre-loved luxury products, it not only provides sellers cash upfront for their items, but also each of its products goes through an unparalleled, rigorous quality and authentication process. This is further aided by its in-house experts who offer repairs and finishing to pre-loved goods where needed.
The platform operates via a 5 S framework in order to explicitly cater to their target audiences’ needs globally:
1. Safety: We provide a safe platform for people to buy and sell their luxury goods. Each buyer and seller is carefully checked, and every item undergoes our strict quality control to ensure the items are in the correct condition described and is authentic.
2. Security: By executing all the necessary checks and using safe payment portals, our members can buy and sell with us in safe and secure environment.
3. Sustainability: We allow people all over the world to recycle their wardrobes for cash. All items sold on our site are loved again with their new owners. We make a difference to the planet.
4. Savings: By using a safe, secure platform to buy a sustainable item you can receive up to 80% of Retail Price and save. Or simply turn your wardrobe in to cash and save.
5. Shopping: If you apply rules 1 to 4 you can shop guilt free! We provide a tailor-made service for every buyer and seller. Giving everyone a VIP Service. At Luxury Promise we deliver a promise we can keep.
The platform was founded in 2017 when the Founder, Sabrina Sadiq, took her previous experience in authentication of luxury goods to instead create a marketplace for rare and vintage handbags and accessories to provide consumers with a sustainable platform to buy, sell and swap luxury goods. Its scaled global operations, with headquarters in both London and Dubai, displays a diverse selection of brands from Hermes and Louis Vuitton to Chanel and Van Cleef & Arpels.
III. The Market Potential
With the growing consumer demand for sustainable fashion, the resale market has been growing at a fast pace. In the US for example, resale has grown 21 times faster than the retail apparel market over the past three years, reaching a value of $24 billion today. This trend is particularly being driven by the prominent consumer groups of Millennials and Gen Z.
IV. The Action
As a result of this growing demand for sustainable fashion choices, The Luxury Promise scaled up the business to reach more consumers globally. Beringea, the transatlantic venture capital firm, has led a $3.75 Million investment into Luxury Promise this April. This Series A round was also backed by Lloyd Amsdon, the co-founder of Watchfinder. Having previously backed several retail and luxury goods pioneers, Beringea has much experience and understanding of the field of luxury. With this $3.75 million funding acquired, Luxury Promise will now be able to better harness the $24 billion luxury resale market.
V. The Results & Future Plans
“I believe we have become the go-to luxury retailer for discerning clients with a focus on sustainability,” says founder Sabrina Sadiq. “We are delighted to have partnered with Beringea to enable us to maintain our strong momentum. With this round of investment, The Luxury Promise will be able to not only broaden its product offering, but also expand the repairs and workshop expertise with an opened storefront location.”
VI. The Learnings
With sustainability gaining much momentum and digital being the key means of purchases for many consumers across the globe, it is important for brands to consider which direction their consumers are going into and how to adapt accordingly. Staying ahead of the curve and in line with your customers' needs is essential in business adaptivity and growth.
The Luxury Promise was founded in 2017 by Sabrina Sadiq, a highly experienced authenticator of luxury goods. The business has since scaled successfully, with operations in London and Dubai, and an outstanding selection of luxury brands including Hermes, Chanel, Louis Vuitton, and Van Cleef and Arpel.