[MZ Tech]④ Limited Edition Sneakers and Collaboration Apparel... 'Low Cost, High Profit' Resell Tech in the Spotlight

Premiums Jump 2-3 to 10 Times
Major Corporations Also Entering Resell Culture One After Another

Editor's NoteFinancial technology for the MZ generation (Millennials + Generation Z) is both an investment and a culture. While the goal is to make money, gaining attention among peers leads everyone to seek 'proof' of their success. This explains the rise of resell tech (securing scarce items and reselling them at a premium) and fractional investment (multiple people investing together in one asset and sharing the profits). We explored the investment methods of the MZ generation, who approach financial technology with ingenious methods unimaginable to older generations.

Stussy X Levi's Collaboration Collection. [Photo by Stussy]

Lee Yunho (30), an office worker living in Songpa-gu, Seoul, has recently developed a new hobby. It is the so-called 'resell tech,' where he buys limited-edition clothing or sneakers and then resells them. This is not limited to luxury brands. Lee is well-informed about limited releases from various brands, including streetwear and sports brands. He gathers information through fashion-related communities and group chats and buys products whenever there is a chance to enter 'lucky draws.' On the 24th, he even lined up early in front of a store to buy a collaboration product between the famous streetwear brand Stussy and Levi's. Lee said, "Only 501 people get the chance to buy this limited product, and if I win, I expect at least a 20% profit. Winning depends largely on luck, but if you are diligent, you can find information, and the fun of buying and selling also brings decent profits."

The popularity of 'resell tech,' which involves buying limited-edition sneakers or clothing with high scarcity value and reselling them at a premium, continues. The MZ generation is at the forefront. For some popular products, prices can easily double or triple from the official release price, and the longer you hold them, the more scarce they become, making them attractive as investment tools. There are even professional resellers who make buying and selling these products their business. Typically, the investment amount is not large, so the burden is low, but the profitability is high, which is another reason for its popularity. In Korea, reselling at a premium was once viewed negatively compared to abroad, so the resell culture developed more slowly. It used to be a niche culture shared in some online communities, but now it is recognized as a common investment method and has become a natural phenomenon.

The domestic resell market is growing rapidly every year. According to data from the Ebest Investment & Securities Research Center on the 26th, the resell platform market, which was worth 700 billion KRW in 2021, grew to 1 trillion KRW last year and is expected to reach 1.5 trillion KRW this year, nearly doubling in two years. This is a global trend, with the global resell market expected to grow to about 10% of the entire luxury goods market by 2025. The category is expanding beyond luxury goods to include items like Lego and figures, indicating even greater growth potential. Currently, the industry estimates that sneakers account for about 80-90% of the entire resell market.

There are many cases where the return on investment is enormous. The 'Air Force 1 Low by Virgil Abloh Met Silver Black,' a collaboration between Nike and Louis Vuitton, was released at 3.51 million KRW but has a resell price of 15 million KRW. The 'Air Jordan 1 X Dior High OG,' a collaboration between Nike and Dior, was released at 2.4 million KRW and currently commands a resell price of 9.7 to 10 million KRW. On SoldOut, the 'Air Jordan 1 Retro Low Travis Scott Sail and Reverse' collaboration with American hip-hop artist Travis Scott has a resell price of 1.4 million KRW, while it was originally released at 189,000 KRW. This represents a return rate of over 300-600%.

Louis Vuitton X Nike Virgil Arlo.
Photo by Louis Vuitton

On the other hand, not all limited-edition or collaboration products are profitable. Recently, the collaboration between Uniqlo and the Italian brand Marni did not attract as much interest from resellers as expected. This contrasts with past collaborations with Balmain or Jil Sander, which saw open runs. Conversely, the recent collaboration collection between Zara and Ader Error, known as 'Zader Error,' saw resellers sweeping up products regardless of size after the open run. In fact, these products later appeared on the market with premiums attached.

Companies are fiercely competing to establish resell platforms and secure market dominance. In Korea, Naver's Cream holds a dominant position. Cream is an intermediary platform where users can buy and sell limited-edition sneakers and luxury goods. The platform inspects items submitted by individuals, purchases them, and then sells them. During this process, it charges users a commission. Besides fashion categories, high-priced collectibles such as figures, rare records, and furniture can also be traded. Cream reportedly surpassed 1 trillion KRW in annual transaction volume last year.

Musinsa is also focusing its efforts on the resell platform SoldOut. Originally, it operated a used goods trading service called 'SoldOut Market,' but it ended that service last month to concentrate on the resell sector. To improve profitability, it switched to a paid commission policy and started charging a 1% purchase fee from last month. Recently, it opened an offline store called 'SoldOut Mokdong' in Mokdong, Yangcheon-gu, Seoul.

Last month, Hanwha Solutions also entered the resell market by launching the resell platform 'Airstack.' It is a resell platform trading limited-edition products from global brands such as sneakers and clothing, aiming for global market expansion. It attracts resellers by offering free shipping and zero transaction fees.

An industry insider said, "As reselling gains attention not only as a hobby but also as an investment tool, the category is gradually expanding, and the penetration rate compared to the existing market will continue to rise. Large corporations and global companies are also entering the market one after another, so competition for market dominance is expected to intensify."