I was thinking about the ticket scalping presentation today
and comparing it to something I saw on the news over the weekend regarding the
sale of Lilly Pulitzer goods at Target for a limited edition collection. For
those who don’t know about Lilly Pulitzer, it is a high-end designer brand
whose main collection typically ranges from $100-$300 per piece. However, their partnership with Target had
new dresses all available under $40. These products sold out within hours of
sales on Sunday (when it hit stores/ online). However, there were major issues
with people purchasing large quantities of the products and reselling them on
Ebay at a much higher price.
Here is a thought on the outcome of the Target-Lilly
partnership in regards to exclusivity:
“ ‘The more popular it is at Target, the
worse it is for Lilly Pulitzer the brand…You see the same things happen with
the outlets for some brands. Look at what happened to Coach; their outlet
business went like hotcakes because you were getting Coach bags at the third of
the price and, long term, it hit the exclusivity of their core business. Part
of what drives high-end fashion is exclusivity.’ ”
Here is a thought
on the outcome of the purchase and resale of Lilly Pulitzer brands on Ebay at
significantly higher prices:
“Lee Yohn says she thinks that the
collaborations are often a win-win, the designers can promote their brand and
reach a different customer base while the Targets of the world can elevate
their retail brand by association with the high end and exclusive. However,
there is a downside to the frenzy: the reselling
(and requisite marking up) of these hot-ticket items on sites like eBay.
"That is less of a win for the retailer and the designer, because then it
diminishes the strategy they are trying to implement."
Lee Yohn said that while it might inspire a
raft of social media criticism, to protect the equity of the brand, next
time, Target might want to look into setting a limit on how many items
people could purchase. ‘In the long run, it might be a smarter way to do it.’”
So my questions are
these:
1: Would you say
this is a similar formula to what happens with ticket scalping?
2: Do you think the
different industries (fashion v. entertainment/special events) make reselling
better or worse for either? Does the importance of exclusivity in the fashion
industry make it different from the reselling of ticket sales?
3: Do you think
Target should have, as Lee Yohn suggested, set a limit on how many items people
could purchase in order to prevent resale?
I’d be really
interested to hear your thoughts! For more info here is the link to the article
I referenced: http://www.entrepreneur.com/article/245290
Here is another
article specifically about reselling LP on eBay: http://www.phillymag.com/shoppist/2015/04/20/the-10-most-insane-lilly-pulitzer-for-target-auctions-on-ebay-right-now/
This is super interesting. This is exactly what I was bringing up in class about the fact that scalpers (who are analogous to people selling on eBay here) often buy up an enormous amount of the product (tickets at sporting events, concerts, etc) right away, so people can't purchase items at reasonable prices. So:
ReplyDelete1) This is pretty much exactly what often happens with ticket scalping.
2) This particular example is really interesting because this type of collaboration between department stores and brands might actually help decrease the demand for fakes of particular brands (which can help prevent a lot of legal problems). When the prices for these products are jacked up artificially, the legal problems with the widespread selling of fake designer brands can start to come into play again. I think reselling is significantly easier when an event is "right about to start" as many sporting events, etc. are, so that might make special events and entertainment more vulnerable to scalping, but there is clearly a form of scalping going on here.
3) Putting a cap on the amount a particular buyer can buy is a good start, but because many scalpers don't work alone nowadays (many of them are part of informal associations that work together to buy up all the product available), caps on how much each buyer can purchase may not work very well.
It is pretty common in fashion industry. H&M teams up with big name brand like alexander wang, Marni every year. Even the most famous brand benefits from joint project. H&M gained huge sales from the projects, and the high-end designers were able to reach a wider consumer base than they had previously been able to.
ReplyDelete1. It is similar to ticket scalping that our group present. Our group focused on event tickets, not train tickets which are necessities. Collaboration fashion products is pretty similar to event tickets. Only small group of people are interested in them.
2.I think in fashion industry, reselling doesn't hurt much. There are many fashion buyer boutiques, where you can buy limited editions of luxury bags and cloths. For event tickets, website like stubhub is for online ticket exchange. Reselling is inevitable.
3.It is effective to prevent over purchasing by placing a limit on the amount items purchasing at once. However, it is unfair to other costumers. At the night before H&M selling collaboration products, the line starts forming at 3 am. The costumers stay all night in order to purchase the limited items.
1. I think that this resale of clothing is exactly like reselling tickets. Scalpers buy them in bulk and then resell them at a premium but just like ticket sales if the price is too high people will not buy them. If someone does not demand a product, either tickets or clothing, even to pay such a premium then they won't. Unlike stub hub with eBay people bid on products so the price of an item is directly correlated with the demand for it. I am not certain how stub hub works but I believe that prices start high and then either increase or decrease based on the number of ticket sales.
ReplyDelete2.The resale of Lilly for Target at inflated prices just shows that they're might not be a need for a discount line through target. If people are willing to buy a "discount" clothing line of a high end designer on a eBay for a much higher price then maybe they should just stay away from the partnership all together and sell their products at the intended price
3. I think made the right decision by not putting a cap on how many items one can buy because like Sarah mentioned above there is nothing to stop scalpers from working together. Also by not having a cap on the number of items one person can buy the demand for items is more clear to see.