When we last spoke to Michael Finn and Nejla Matam-Finn, the husband-and-wife founders of the preloved luxury website The Fifth Collection, in 2018, the platform was on an upward trajectory with business “doubling or tripling every year”. Then, the pandemic hit and things slowed down as the global economy slumped. Nonetheless, the global market for preloved luxury goods – estimated by consultancy Bain & Company to be worth 22 billion euros last year, with an annual growth of nine per cent since 2015 – remains a promising vertical. Matam-Finn, whose company recently moved into larger premises – “a sign that I am running a pretty solid business”, she notes with a smile – reveals how, despite its challenges, the stormy global situation has had a silver lining for the secondary luxury market and consequently, The Fifth Collection.
What effect has the pandemic had on The Fifth Collection?
It’s tough. We have been prudent since we saw this coming as early as January. But, interestingly enough, the lockdowns have been pretty good for customer acquisition. When the world went into lockdown, being in our space – online and doing second-hand – helped us tremendously. I think the fact that people had more time to research different platforms led several countries to discover The Fifth Collection; even though we haven’t spent a dollar on marketing yet this year. Previously, half of our business was already international. Usually, our overseas customers are from Australia, New Zealand and Hong Kong. During the circuit breaker, a lot of Americans and Europeans showed up. And, as we have a pretty good reputation with existing customers, after someone finds us, they come back.
Do you think the Covid-19 situation has helped or hurt the pre-owned luxury industry as a whole?
It has helped. Even before the pandemic, there was a lot of conversation around sustainability and fashion. Before this, the industry had been running straight into a wall, with problems like overproduction. The pandemic has served as a reset. People naturally started looking at platforms such as ours. But I think a more significant factor, honestly, is that people are still looking for good deals, and that’s what we offer. It’s about how I can get more for my dollar without hurting my lifestyle, and if I liked luxury brands before, I still want to have access to those now.
What challenges are you facing right now?
People are after a good deal. Right now, it’s hard to say if they’re going to choose a second-hand or primary-market player because many brands and retailers are heavily discounting their merchandise. You see this online and also in physical shops. In Europe, for instance, when the stores first reopened, some offered discounts of up to 50 per cent. Of course, some brands will never go on sale or only occasionally have private transactions, so people who want those brands are happy to come to us. Right now, we offer the choice of new and second-hand. If it’s the same deal, then they will go with the former. We try to be competitive with the other offerings out there. The Fifth Collection curates and sells pre-owned luxury items.
Currently, the sellers you work with are based in Singapore. How have things on the supply side changed due to the pandemic?
People are spending more time at home and have had more time to declutter. We’ve had more people sending us homeware such as photo frames and other small items. Of course, there were a lot of clothes, too. We’re not doing marketing on that side of the business right now, but people keep showing up. Of course, we don’t accept everything, and we do curate the selection on the website. For example, if a person has 50 pieces, there might be 20 we can sell. We have to donate the balance or return them to the owners.
How have buying patterns changed as a result of the increased numbers
of people working from home?
Anything that can be worn here (gesturing at her upper torso) has been selling well for people who work and have to do online meetings. People are buying more comfortable clothes – big sweaters, comfortable pants, flowy dresses – that can be worn at home and also for a video call. Some even prepped for emerging after the circuit-breaker by buying items such as fancy heels. Typically, our bestsellers are big-ticket items such as handbags, and we’ve seen people shifting their purchases to clothes and accessories – scarves are doing well. The product line that has suffered the most is gala dresses or evening wear. Those aren’t going anywhere right now.
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