eBay is expanding upon its existing authentication efforts to include certain handbags in addition to $2,000-plus watches and sneakers with price tags of upwards of $100, as sales within its “luxury categories continue to gain momentum” as indicated by “recent quarter-over-quarter growth.” With such growing demand in mind, San Jose, California-headquartered eBay announced this week that it is extending its Authenticity Guarantee service to include “new and pre-owned handbags sold for more than $500 from 16 prominent luxury brands” – from Gucci and Goyard to Louis Vuitton and Hermès, with the aim of “delivering a more seamless and accessible experience that lets shoppers buy and sellers sell luxury handbags with total confidence.”
On the heels of rolling out authentication services for luxury watches and sneakers last year, eBay revealed in a statement this week that it has experienced “significant growth” in these categories. Its sneakers business has grown at “a triple digit rate on a year-over-year basis for several quarters, while its watches business accelerated from 16 percent to 38 percent in Q1” of this year. Meanwhile, eBay claims that “focusing on these core verticals has, in turn, lifted sales in other categories, as well,” such as handbags. Tirath Kamdar, who is the GM of Luxury at eBay, echoed this sentiment, pointing to “an iconic Hermès Birkin bag [that] recently sold for $98,000” and to the burgeoning success of the 26-year-old company’s watch business, which “doubled last quarter.”
By way of the “additional layer of trust and confidence” that it provides to buyers and sellers, Charis Márquez, VP of Fashion at eBay, says that the Authenticity Guarantee effort “has changed the way people buy and sell luxury items on eBay,” including by spurring a rise in handbag sales. On average, the company states that there are roughly 1.41 million handbags listings on its platform every day, with five handbags selling every minute. Reflecting on 2020, the eBay says that it sold over 2 million handbags in North America, with sales of bags from brands like Louis Vuitton, Gucci and Prada up 31 percent on a year-over-year basis.
In bulking up its Authenticity Guarantee initiative, eBay revealed on Wednesday that all $500-plus handbags from Louis Vuitton, Chanel, Gucci, Hermès, Saint Laurent, Celine, Dior, Prada, Fendi, Goyard, Burberry, Chloe, Valentino, Givenchy, Balenciaga, and Bottega Veneta that are bought and sold in the U.S. “will be vetted and verified by eBay’s team of professionally trained authenticators, using detailed physical inspection and advanced technical equipment in a state-of-the-art facility.”
While the newly-announced authenticity efforts will likely help eBay to further boost sales of luxury goods on its platform, particularly as consumers become increasingly comfortable buying second-hand luxury goods and doing so in an e-commerce capacity (existing trends that were accelerated amid the COVID-19 pandemic), there might be a double-edged sword at play: such efforts might set the company up for potential legal issues in something of the same vein as the likes of The RealReal (“TRR”), for instance, which was sued by Chanel in November 2018 on the basis that it allegedly sold a number of Chanel-branded bags that it “purport[ed] to be genuine but [were] in fact counterfeit.”
A key complaint of Chanel’s in the case is TRR’s practice of allegedly “attempt[ing] to deceive consumers into falsely believing that [it] has some kind of approval from or an association or affiliation with Chanel or that all Chanel-branded goods sold [on its website] are authentic,” which Chanel has claimed is not the case. Specifically, counsel for Chanel has argued that while TRR advertises its authentication efforts, “The only way for consumers to absolutely ensure that they are in fact receiving genuine Chanel products is to purchase such goods from Chanel or from an authorized retailer of Chanel.”
The brand has since doubled-down on this point, further alleging that “training and knowledge regarding authentication of genuine Chanel-branded goods could only reside within Chanel.” In other words, “Only Chanel, itself, can know what is genuine Chanel,” and what is not, an assertion that has been the subject of quite a bit of pushback from TRR.
That case is still underway in a New York federal court, with the two parties agreeing to temporarily put court proceedings on hold in order to participate in a private mediation. In an order dated April 5, Judge Gabriel Gorstein of the U.S. District Court for the Southern District of New York issued a joint stipulation and order staying the process of the trademark infringement and counterfeiting, false advertising, and unfair competition case for three months, aimed at getting the high fashion titan and the luxury resale pioneer to settle their ever-escalating legal differences out of court and without the need for a trial.