Mass layoffs, inflation, and fears of a recession are not only putting a damper on consumers’ appetite for buying the latest fashion products but also on how much they are willing to pay for pre-used items.
The RealReal’s Annual Luxury Consignment Report 2023 shows that resale prices for Louis Vuitton handbags fell 20%, Gucci by 17%, Hermès by 10%, and Chanel by 9% over the past three months.
“We started noticing it in late summer, early fall of last year,” said Sasha Skoda, director of merchandising at The RealReal.
“Consumers are worried about the economy and they are not spending as much. They are no longer willing to pay the same price at resale that were willing to pay last year for brands like Hermes, Gucci and Louis Vuitton,” Skoda added.
While brands such as Gucci, Louis Vuitton, and Hermès are taking a hit, other luxury brands, such as Miu Miu and Bottega Veneta that are relatively cheaper, are seeing an uptick in demand.
Resale buyers have also become less picky about the condition of pre-used items as they prioritize lower prices over product quality.
“A potential recession, the climate crisis, and global unrest are all reasons that, going into 2023, consumers are making shopping decisions based on value,” said Rati Sahi Levesque, co-CEO and president of The RealReal in the report.