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Management article
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Reference no. R2306E
Published by: Harvard Business Publishing
Published in: "Harvard Business Review", 2023

Abstract

The average US household contains a trove of potentially reusable goods worth roughly USD4,500. That's a lot of trapped value, and companies are at last getting serious about accessing it-by developing new resale capabilities. Resale has been with us for a very long time, of course-at yard sales, on used-car lots, in classified ads. But the magnitude of the market is changing, boosted by Gen Z consumers and a growing demand for sustainability. Some major brands, including Apple, Nike, Rolex, and Walmart, are moving into the market. And GlobalData estimates that the total resale market in the United States is around USD175 billion. In this article, Robertson, a former dean of the Wharton School, focuses on the potential benefits of resale and helps leaders think about whether resale makes sense for their brands. Drawing on interviews with executives who work at companies that are actively pursuing resale and at third-party platforms that have become important partners in the resale ecosystem, he offers five guidelines for resale success: (1) design friction-free processes, (2) work with a third-party platform, (3) transition to the Gen Z consumer, (4) integrate brand-loyalty initiatives, and (5) build an integrated portfolio.

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Abstract

The average US household contains a trove of potentially reusable goods worth roughly USD4,500. That's a lot of trapped value, and companies are at last getting serious about accessing it-by developing new resale capabilities. Resale has been with us for a very long time, of course-at yard sales, on used-car lots, in classified ads. But the magnitude of the market is changing, boosted by Gen Z consumers and a growing demand for sustainability. Some major brands, including Apple, Nike, Rolex, and Walmart, are moving into the market. And GlobalData estimates that the total resale market in the United States is around USD175 billion. In this article, Robertson, a former dean of the Wharton School, focuses on the potential benefits of resale and helps leaders think about whether resale makes sense for their brands. Drawing on interviews with executives who work at companies that are actively pursuing resale and at third-party platforms that have become important partners in the resale ecosystem, he offers five guidelines for resale success: (1) design friction-free processes, (2) work with a third-party platform, (3) transition to the Gen Z consumer, (4) integrate brand-loyalty initiatives, and (5) build an integrated portfolio.

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