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- Shoppers of secondhand luxury items are increasingly trading brand loyalty for more affordable luxury brands.
- Balenciaga is dominating the South African market in resale value, having dethroned the likes of Louis Vuitton and Chanel.
- Louis Vuitton and Gucci have come out on top in the search interest category, with Rolex dominating search interest against availability in the market.
- For more stories, visit the Tech and Trends homepage.
Secondhand luxury customers in South Africa are gravitating towards less expensive brands as they become more price-conscious due to harsh economic conditions.
This is according to The State of the Luxury Market in Africa Report 2023 by Luxity, one of South Africa’s leading pre-owned luxury resellers.
The report revealed that South Africans still have an appetite for luxury goods, but are a lot more price-conscious, and, therefore going for less expensive luxury brands.
Brands that are known to dominate in the luxury industry such as Louis Vuitton and Chanelexperienced a shake-up with South African customers this year, with the resale value dropping by 1.9% and 0.9%, respectively.
Balenciaga, on the other hand, showed massive strength, having recorded a robust 10.1% increase in resale value. This happened despite the brand's diminished desirability internationally due to its controversial advertising.
"Brands that were quite discounted like Balenciaga, have seen an increase. What this is telling us is that essentially, people still want luxury, but they are not so picky about a brand. They are more picky about the price point," said co-founder and CEO at Luxity, Michael Zahariev, in a News24 interview.
"When a certain brand gets too expensive, they're looking to other brands which are more affordable because they still want to be in the luxury sphere, but they want to make sure that it's matching their affordability."
Zahariev explained that the tough economic climate has resulted in customers leaving brand loyalty for affordability.
Top five brands by resale value
In terms of resale value, Chanel occupied the number one spot, dethroning Louis Vuitton, which has been the long-standing leader. This happened despite its unavailability in the South African retail market.
Next in line is Louis Vuitton, followed by Rolex and Cartier, indicating just how appealing luxury watches and jewellery are to South African collectors and luxury enthusiasts.
Gucci came in at number five. Although its dominance has dwindled, Gucci took the number two spot in volume metrics.
Search interest
Although Balenciaga has dethroned various brands in terms of resale value, designer brands such as Louis Vuitton (16.88%) and Gucci (14.14%) still hold the fort when it comes to most searched brands. This is followed by Prada (5.26%) and Burberry (5.26%). Last on the top five list is Christian Louboutin, at 4.60%.
"The digital footfall underscores these brands' voluminous presence: they dominate not only in search curiosity but also in transactional metrics, leading in both purchases and sales on the platform," according to the report.
When looking at search interest against availability in the market, brands like Rolex dominate, leaping from 1.73% in search history to a staggering 13.11%. Next in line are Cartier and Omega at 4.92% and 4.55% respectively.
"While raw search metrics depict a familiar luxury hierarchy, a supply-adjusted lens unveils hidden dimensions, spotlighting brands with intrinsic desirability and hinting at potential market trends on the horizon," the report said.
High-Net-Worth Individuals
Although a large portion of South African luxury buyers have become price-conscious, the more affluent segment is gravitating towards much higher prices.
In terms of what people are searching for, "as the price increases, the volume of people searching for it decreases. But when we get to the upper price point, the highest price point, we see a spike.
"What that's telling us is that there is a large portion of high-net-worth individuals who are seemingly unaffected," Zahariev told News24.
