The streetwear resell market is in the billions of dollars. Sales are primarily driven by non-traditional, non-paid, organic marketing channels like social media or personal networking. Behind much of the sales are thousands of student-aged entrepreneurs (some making tens or hundreds of thousands of dollars in the process) battling to get their hands on the latest exclusive piece by companies such as Supreme or Palace. There are several key lessons that any business owner or marketer can learn from this market.
I had the pleasure of interviewing Mike Piediscalzo, a 22-year old serial entrepreneur to provide some eCommerce value from what he’s learned as a successful reseller. He’s had success in the resell market, selling to some of the largest names in hip-hop. Along his journey, he’s picked up a myriad of lessons that can be applied in other eCommerce industries.
Should you sell products on a marketplace?
Mike: There are several pros and cons to selling products on a marketplace such as Amazon (or in my case, Grailed/StockX/Goat). One major advantage to selling products on a marketplace is the ease that it brings in terms of payment processing and order fulfillment. Marketplaces also provide some free, organic customers through people simply browsing around and finding your product. Most marketplaces also mitigate risk from fraudsters and scammers by providing payment protection. Some drawbacks to using a marketplace is that all of this provided value comes at a cost, generally by a chunk of your revenue and/or a monthly subscription. Another reason to keep transactions off marketplaces is to avoid price competition with similar or identical products, which users can easily click to on a marketplace.
What are the alternatives to selling products on a marketplace?
Mike: If you want to truly “own” your audience/customers, it is best to not sell your products on a marketplace. In my case, I was able to sell directly through Instagram. For lower-ticket goods or products that aren’t worth customers messaging you, you can set up a Shopify store and direct traffic to it from your Instagram. Selling through social media allows you to always have access to your customers and audience through stories, feed posts, and direct message. This allows you to keep people consistently engaged with your brand. If you want to retain the benefits of social media and marketplaces, you can use them in tandem by directing followers directly to your marketplace product URL, although you should expect some leakage as marketplaces often advertise other products right below yours.
From Mike’s advice we can conclude that when deciding what kind of marketing/sales channels you want to use, it is important to take into account your projected volume, price, and competition.