The sneaker and apparel resale market has not just survived amid the pandemic but thrived, says GOAT Group co-founder and CEO Eddy Lu. He joined Yahoo Finance to discuss the growth of the global resale marketplace and why he believes shopping online is “superior” to the brick-and-mortar experience.
GOAT is coming off the heels of a Series E funding round of $100 million from D1 Capital Partners. The company, through strategic investment partners such as Foot Locker (FL), Index, and Upfront Ventures, has raised almost $300 million in venture capital funding. Lu says a big part of the company’s success is the shift to e-commerce.
“We were already seeing a secular shift towards e-commerce pre-COVID. Post-COVID, that trend has only turbocharged as shopping in stores is no longer an option for most consumers. For GOAT, it was providing a great experience with our operational rigor to allow consumers to buy products on our site,” he said.
Lu says that there has been a “flight to quality” on sought after and limited-edition sneakers, causing a rise in prices for higher-quality shoes. At the same time, some of the more mainstream offerings decreased in price. Lu says that 40% of GOAT’s sales have been under retail price. Lu tells Yahoo Finance that’s due to the sheer volume of product that the platform offers consumers.
“What we’ve seen is the fact that shopping on GOAT is actually a superior experience to shopping in retail stores. If you can imagine on GOAT, we have over 100,000 unique SKUs compared to going into a retail store that has about 200 SKUs, and any on any given day.”
The backbone of any reselling platform is authentication. Despite the pandemic forcing GOAT to shut down some of its authentication centers, the brand was nimble enough to keep the process going.
“When March happened, there was no business in the world that wasn’t affected by COVID, but it goes back to our operational rigor. We focused on operational rigor from day one. We weren’t a growth-at-all-costs type of company that cut corners operationally,” he said.
“So when we created our operational centers, we had them spread out throughout the world. So when COVID happened we had to shut down different facilities, we were able to shift our sales from sellers to other facilities to authenticate and quality control before we sent it off to our buyers.”
Reggie Wade is a writer for Yahoo Finance. Follow him on Twitter at @ReggieWade.
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