How Automation could help fashion and luxury reseller marketplaces

The global second-hand luxury market is estimated to be worth $31.1 billion in 2022 and is expected to reach $51 billion by 2028

Luxury resale platform The RealReal reported a 29% YoY increase in revenue, reaching $603 million in 2022.

Online consignment store Poshmark reported a 25% YoY increase in revenue, reaching $326.0 million in 2020.

The resale market is growing 21 times faster than the traditional retail market.

These statistics show that the reseller marketplaces are growing rapidly and are becoming increasingly important in the fashion and luxury industry. The growth in the resale market is being driven by changing consumer attitudes towards sustainability, affordability, and uniqueness.  However, these marketplaces also face several challenges such as managing inventory, pricing, and customer service. Fortunately, automation can help address these issues and provide a better experience for both sellers and buyers.

In this blog we will focus on a few of the area where automation can add significant value.

Automated Inventory Management
One of the major challenges for reseller marketplaces is managing inventory. With hundreds of sellers listing thousands of items, it can be difficult to keep track of what is available and what has been sold. Automation can help by providing real-time updates on inventory levels and automatically removing sold items from the website. This ensures that buyers only see available items and reduces the likelihood of overselling.  

Managing customer journeys
‍A reseller sometimes only has one off items. They cannot always control their inventory based on trends and projected demand. This makes room for customer disappointment. Resellers could use AI based product recommendations systems like that keep the customer engage and nudge them towards products in stock.

Standardising product tags and descriptions
With so many individuals uploading products onto the platform it is hard to expect them all to adhere to best practices with respect to data. Nonstandard data makes navigation and product discovery hard. Using automated solutions like Catalogix.ai Resellers can rely of Computer vision and ML models to generate the relevant tags and descriptions, eliminating the need for manual data entry and the risk of errors. This not only saves time, it reduces the workload for sellers, allowing for smoother onboarding.  

Image management
Most people are not great photographers and don’t have access to expensive cameras, so product shots will have all sorts of issues. They may not be composed well, have a cluttered background, poor lighting etc.  While Resellers give a list of Do’s and Don’t for best practices, they need to have a backup to standardise the images and keep them looking clean. Doing this manually takes a lot of time effort. Resellers can use AI based image management solutions like Catalogix.ai to edit and replace backgrounds, standardise the aspect ratios, reset lighting etc. To present the product in the best possible manner

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Identifying fakes
Although there are no comprehensive solutions to authenticate products using technology. It is possible to train AI/ML models to identify fakes. These systems can proactively scan for fakes and flag them for human inspection.  

Pricing Automation
‍Another challenge for reseller marketplaces is pricing. With thousands of items listed at different prices, it can be difficult to determine the fair market value of each item. Pricing too high could result in slow sales, while pricing too low could mean leaving money on the table. Automation can help by using machine learning algorithms to analyze market trends and suggest optimal prices for each item. This not only helps sellers' price their items competitively but also ensures that buyers get fair prices.

Customer Service Automation
‍Customer service is crucial in any marketplace, but it can be challenging for reseller marketplaces with many sellers handling their own customer inquiries. Automation can help by providing chatbots that can answer common customer inquiries such as shipping times, returns, and refunds. This not only frees up seller time but also provides a consistent customer service experience for buyers. Furthermore, automation can help with shipping and tracking updates, ensuring that buyers are always informed about the status of their orders.

Automation can help in so many ways to improve efficiency, increase accuracy, automation of order processing and fulfilment, reduced cost of human resources etc.  

Reseller marketplaces are likely to continue to play a significant role in the future of fashion and luxury. This is just the tip of the iceberg. With the uniqueness of each product and the scale at which they must operate, Resellers need to leverage automation to provide better experiences for both buyers and sellers ensuring continued growth and success.

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