StockX is an online resale platform for sneakers founded by Dan Gilbert, Josh Luber, Greg Schwartz, & Chris Kaufman and launched in 2016.
Also termed as “the stock market of things” StockX – the real-time trading marketplace primarily resold authentic and unworn limited-release sneakers online. It is a breeding ground for young resellers like Joe Hebert turning Yeezys and Jordan sneakers into a bonafide asset. Joe Hebert recalls how his sales tripled from selling deadstock (discontinued or vintage line-up of unworn sneakers) in May last year on StockX, reaching a mammoth $600,000 – as reported by Bloomberg.
StockX has emerged as one of the leading resale platforms in recent years, with a Gross Merchandise Volume (GMV) of $1.8 billion in 2020. While the platform resells premium designer clothes, gaming consoles, smartphones, and other products as well, yet sneakers accounted for the majority of sales, capping at around 7.5 million trades last year. With an immediate focus on power sellers* and recording the highest amount of unique visitors per month according to SimilarWeb’s market insights – StockX is edging out its competitors like GOAT and Stadium Goods.
StockX Success In Numbers
Raised $110 million in Series C funding round in June 2019, bumping its valuation to $1 billion – officially joining the unicorn club.
Witnessed 200 million visitors in 2020 amid the addition of new categories such as electronics and pouring VC investments
StockX is now worth $3.8 billion after 9 funding rounds and a total of $690 million raised in nearly 5 years.
Luber and newly named CEO Scott Cutler, formerly a Senior VP at eBay and President of StubHub, joined Yahoo Finance’s “On The Move” to discuss the site and burgeoning resale market. “We are a marketplace; we are an evolution of eBay but the way we connect buyers and sellers is the exact same way the world’s stock connects buyers and sellers, “ said Luber. Buyer place Bids, Seller place Asks, and when a Bid & Ask meet, the transaction happens automatically – across a true market price. Source: Yahoo Finance
Starting An Online Marketplace Like StockX: Things To Learn
1. StockX’s Business Model
StockX is based upon a real-time trading market similar to an equity or stock market. Here, the seller lists in-demand items (in excellent condition) on sale and the buyer determines the appropriate price for trading. The marketplace enables buyers to bid and purchase the coveted items at real-time prices, denoting the current demand. This is an excellent business model for aspiring business owners to start an e-commerce marketplace.
StockX offers access to highly sought-after products like the hottest sneakers, the coolest electronics, or the coveted accessories online. Unlike Amazon, eBay, and other e-commerce giants, expert authenticators verify each item sold on StockX through a multi-step verification process. Once the package arrives at StockX, the team recommends a minimum of three business days to pass the verification process.
To sell on StockX, sellers place an Ask for their coveted items which determines the price at which the seller is willing to trade their items.
The Ask is set to an expiry date anywhere between 1 to 60 days.
The seller can update or cancel the Ask anytime before it finds a matching bid.
In case, the seller does not wish to wait, he/she may opt to sell immediately to the highest bid by selecting “Sell Now” on the product page.
Buyers, on the other hand, can place their bid – making a financial offer for the item on StockX.
Like Ask, bids also have an expiry date and can be easily updated or canceled by the buyer before it finds a matching Ask.
A buyer may opt to purchase the item at the current lowest Ask without any waiting time by selecting “Buy Now” on the product page.
A successful transaction occurs on the marketplace when the seller and buyer find a matching price, i.e. buyer places the highest bid, and the seller agrees with the price. In case, the seller has the lowest Ask – then the item is automatically sold to the buyer with the matching bid.
All the Asks, Bids, and Sales related to the particular item can be viewed on the product page – ensuring truly transparent pricing. Also, the marketplace is more inclined towards Power Sellers*, offering them benefits like bulk shipping, bonus discounts, early payouts, VIP account management, and access to more advanced tools.
2. Revenue Model: How StockX is earning money?
StockX charges a flat 3% payment processing fee as well as a transaction fee ranging between 8% – 10% on every successful sale on the platform. The transaction charges are based upon seller levels, i.e. better the seller level, lower the transaction fee. These seller levels are determined by the number of sales completed, as shown in the figure below.
Its seller program rewards sellers with great performance in a calendar quarter, hence encouraging more sales in the marketplace. Business owners looking to start an online marketplace like StockX will benefit from its sustainable revenue model.
Filtering – With over 25,000 sneakers and a healthy collection of streetwear, Electronics, collectibles, handbags, and watches from popular brands – StockX gains a lot of traction. The marketplace has a robust filtering system to streamline the buying and selling process where users can sort each category by popular brands, most popular items, new lowest ask, and the new highest bid. Also, general filters for size, price range, gender, and season are available as well.
Payment method – While the individual buyers are requested to fill out the payment information when placing a bid, they are charged only when the bid has been accepted. This prevents any pointless offers or transactions. StockX accepts all major credit cards, debit cards, PayPal, Alipay, and more.
Mobile App – Intuitive mobile apps have been a huge selling point and an incremental feature in the platform’s instrumental rise. The mobile apps have garnered an overall rating of 4.6 (from 215.3K reviews) on the App Store and 4.5 (from 52.3k reviews) on Google Play Store.
Real-time order tracking – From product shipping by the seller, authentication in-process to product delivery – the marketplace enables buyers to track their product arrival with real-time updates. It requires sellers to ship their products within two business days once the Bid meets your Ask.
Historical Price Data – The marketplace provides complete product details, price history, and a 12-month historical price chart for every listing to help buyers/sellers check the competitiveness of their pricing.
4. StockX: Marketing Strategies
In 2020, the majority of sales on the popular secondhand marketplace – StockX came from outside the US – particularly in Europe and Japan, according to StockX CMO Deena Bahri. These international sales grew by nearly 200%, accounting for over 30% of all StockX gross merchandise volume (GMV), thanks to their marketing strategies. The marketing team at StockX comprises a core US team and local marketing teams.
Our approach is to leverage the mothership team in the U.S. who has the breadth of experience and just the horsepower of a bigger team, then to balance that with the nuance and cultural context of a local team,” Bahri said. “The understanding that the local team has of the specifics of the region [is key] — [knowledge of] things like who the key influencers are is hard to get from a distance. Source: Glossy
StockX Marketing Approach: Step-By-Step
StockX’s team typically kickstarts their marketing campaign with SEO and paid advertisement – since most first-time consumers discover the brand online. These are the two mainstream digital channels to increase the brand’s reach and target the right audience.
Next, the StockX marketing team focuses on creating a cultural marketing campaign to generate interest among its target audience. For instance, in the fall of 2020, StockX partnered with Jackson WANG – a Hong Kong rapper with a global fan base – to create a Team WANG IPO campaign. The campaign was a huge success, with over 40% of all bids originated from outside the US – the highest share of international bidders for any StockX IPO.
Similarly, in 2016, to kick-off one of its elite partnerships with Detroit native Marshall Mathers (a.k.a., Eminem), StockX started a unique contest to give away three coveted prize packages, including Air Jordan 4 Retro Eminem Carhartt – sneakers that once sold for almost $30K on eBay. The influencer campaign was a huge success resulting in – a 100% week-over-week increase in sales, 1,614 new customers from referrals, and generated $441,488 revenue in less than 3 weeks, according to getambassador.com.
Lastly, the marketing team retargets using paid digital ads to convert one-time customers into recurring customers. Alongside cultural marketing, paid search and Instagram ads will always remain a primary focus of the marketing team. Recently, they started streaming TV ads in the US – a fruitful experiment that Deena says her team will continue to explore even in the future.
Focus on New StockX Categories
Deena Bahri reflects how the addition of new categories such as electronics and collectibles has significantly impacted the current marketing tactics. For instance, the newly launched Sony Playstation 5 – sold within seconds on all other platforms after its launch – was available for purchase at StockX albeit at a higher price. The increasing interest due to in-demand or limited-edition products available in various categories means that the focus is not just on sneakers. There are products in multiple niches alongside sneakers for the StockX marketing team to focus upon.
“We have definitely started to think of the customer in a holistic way, not just on a category-by-category basis,” Bahri said. “Sneakers, electronics, gaming — those are all part of the same bullseye. The customer is engaged by all of them, so while we still do product-centric creative just focusing on sneakers or just gaming, we’ve been shooting a lot more cultural content that includes all of these categories.”
For now, the main focus is on international expansion and growth in 2021. Outside Detroit, StockX has a physical presence in England, China, Netherlands, and Canada. Also, it ships products to nearly 200 countries – with international shipping and payment processing fees applicable.
5. Cost of Development
Developing a StockX like marketplace from scratch requires a team of expert designers/developers, hundreds of thousands of development hours, and anywhere between USD $100K to millions of dollars in capital investment. Plus, there’s a maintenance fee, hosting fee, additional customizations, marketing cost, and a lot more.
Instead, it is recommended to choose a turnkey multi-vendor marketplace solution like Yo!Kart, whose pricing starts at $999 – a one-time license fee. Yo!Kart’s base package includes all standard essential e-commerce features and integrations necessary to build an online marketplace like StockX successfully. It is a fully customizable multi-vendor e-commerce platform for aspiring business owners, startups, as well as enterprises to integrate new features/modules as per their business requirements and gain a competitive edge.
With a current valuation of nearly $4 billion USD, a trusted product authentication system, thousands of high-ticket products, and many loyal users (customers and sellers) in just 5 years – StockX has swiftly emerged as the leader in the sneakers and clothing resale market. Amid this disruption, the secondhand products industry is also growing at a tremendous pace, tipped to reach a staggering $77 billion by 2025, according to Statista. To capture the growing market segment, aspiring business owners need a readymade solution to build/deploy an online marketplace like StockX.
Q1. What is a resale marketplace or reseller platform?
A resale marketplace is one where sellers resell coveted items/accessories online. Also termed as secondhand products marketplace, here products with greater demand in the market can be sold albeit at a higher price than the face value. StockX, for instance, is a prime example of a reseller platform/marketplace.
Q2. What is the best platform to resell on?
From reselling limited-edition sneakers to clothing and electronics, StockX has emerged as one of the best platforms to resell your coveted items. The marketplace offers excellent returns to sellers with its unique business model. Aspiring business owners who wish to start an online marketplace like StockX , can choose Yo!Kart -multi-vendor platform.
Q3. What does resale market price mean?
The price at which an item is resold by the retailer or business in the market is termed as resale market price. Many sellers usually purchase in-demand items at face value and resell them afterward on marketplaces like StockX at a greater price.
Q4. How big is the resale market?
From Etsy’s acquisition of Depop (a P2P social sharing marketplace) to Levi’s Secondhand marketplace, the resale market is growing rapidly. For instance, the secondhand apparel market globally is projected to reach $77 billion in 2025, up from $27 billion in 2020, according to Statista.
Q5. Can you resell items on Marketplace?
Marketplaces like StockX, Poshmark, Depop, and others enable vendors to resell coveted items/accessories online. Such marketplaces have become a breeding ground for resellers to build a sustainable business.
Q6. Which resale app is best?
Poshmark and StockX are the two best unique resale marketplace apps worldwide. Both marketplace applications are available on the iOS and Android platforms with their intuitive UI design and a larger audience base.
Q7. What’s the best platform to sell used clothes?
ThredUp is the leading fashion resale marketplace followed by Depop, Poshmark, and eBay. You can easily register to either buy or sell used clothes online at a competitive price.
Q8. How can I make a website like StockX?
To build a website like StockX, you need a reliable multi-vendor solution like Yo!Kart that offers all essential e-commerce features and integrations. The platform is highly customizable and can be personalized to cater to your business requirements.
Q9. Is StockX a marketplace?
Yes, StockX is an online resale marketplace where users (sellers and buyers) register to either buy or resell authentic items/accessories such as sneakers, clothing, electronics, and more. The entire marketplace operation is streamlined by the StockX team.
Q10. Who are StockX competitors?
GOAT and Stadium Goods are among the leading competitors of StockX. Yet, the marketplace has managed to edge them out with its strong focus on power sellers and a record number of unique visitors per month.
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