Have you ever dreamed of owning luxury goods at more accessible prices? eBay is now attempting to turn that dream into reality. Facing continuous declines in e-commerce market share, the online giant has set its sights on the booming secondhand luxury market, hoping to revive its former glory. This strategic shift represents not just a business adjustment, but a high-stakes gamble for survival.
Returning to Roots: eBay's High-End Resale Strategy
Founded in 1995 as an auction platform, eBay built its empire on secondhand transactions. Now, refocusing on pre-owned items and collectibles—particularly high-end resale—has become central to its comeback strategy. Company executives position this move as critical to reclaiming eBay's position in e-commerce and recovering market share lost over the past decade.
Despite pandemic-era growth, eBay's decline continues. Market data shows its valuation has plummeted from $53 billion last year to $21 billion today. Recent financial reports reveal five consecutive quarters of year-over-year sales declines, with its U.S. market share shrinking from 7.6% in 2016 to just 3.5% this year.
CEO Jamie Iannone acknowledges eBay can no longer compete with Amazon in new product sales. However, he sees greater potential in the secondhand market, believing eBay's experience and resources position it to regain consumer trust.
To execute this vision, eBay has significantly increased investment in luxury resale. Beyond interface improvements tailored for jewelry and other premium categories, the company is expanding inventory and enhancing services. By 2024, these focus categories are projected to comprise 50% of eBay's sales, up from just 20% at the end of last year.
This pivot aligns perfectly with growing circular economy trends. As environmental consciousness rises, more consumers embrace secondhand shopping—creating substantial opportunities in luxury resale.
A Golden Era for Secondhand Luxury
The pre-owned luxury market faces unprecedented growth. Business of Fashion projects the luxury apparel resale sector will expand from $27 billion in 2020 to $37 billion by 2025. The sneaker resale market shows similar potential, forecast to reach $30 billion by 2030. McKinsey estimates resold luxury watches will account for one-third of global watch sales by 2025.
These projections signal a golden age for secondhand luxury—an opportunity eBay hopes will power its e-commerce revival.
Navigating Fierce Competition
Yet the luxury resale landscape grows increasingly crowded. Platforms like StockX and GOAT have secured $1.2 billion in combined funding. The RealReal raised $300 million through its 2019 IPO, while Poshmark recently sold to South Korea's Naver for $1.2 billion.
Beyond startup rivals, eBay faces competition from luxury brands themselves. Balenciaga, Gucci, and others now operate resale shops—with 107 major U.S. brands currently running secondhand stores, up from just 37 last year according to ThredUp.
eBay's advantage, Iannone argues, lies in cross-promotion potential. Data shows customers purchasing $2,000+ luxury watches typically spend another $5,000 on watches and $5,000 across other eBay categories.
The company invests approximately $100 million annually in authentication services, operating five global "authentication centers." In sneakers, eBay's lower seller fees compared to StockX and GOAT may attract more inventory.
However, eBay hasn't disclosed financials for its authentication business. Currently, "collectibles" represent $10 billion in annual sales—about 10% of total platform volume.
A Pivotal Moment for eBay
eBay's luxury resale bet presents both opportunity and risk. Whether its marketplace experience can overcome fierce competition and shifting consumer preferences remains uncertain. But this strategic shift undoubtedly injects new energy into secondhand luxury while expanding consumer choice.
The road ahead demands improved user experience, stronger authentication, broader inventory, and effective competition response. Regardless of outcome, eBay's high-stakes pivot warrants close observation as it seeks to redefine its future.