Opinion: Luxury Should Embrace China’s Secondhand Boom

With a 20-year spending spree over, luxury brands must reinvent the way they relate to Chinese consumers. There’s no better way to do that than by embracing the country’s flourishing secondhand market. 

China’s high-end retail boom was unprecedented in scale and speed while it lasted. A culture that values keeping up appearances found an outlet in Western prestige shopping when it opened to the world at the end of the 1990s, fueling a period of expansion that lasted until the collapse of the property sector five years ago. With a lackluster economy and job prospects, the pragmatic Chinese shopper has shed her old biases against used luxury goods. What was once taboo is now considered chic.

The trend presents an opportunity for upscale brands. There’s no need for them enter the resale business directly. That space is already dominated by homegrown consignment platforms like ZZER (whose Chinese name means “secondhand only”), Zhuanzhuan (“pass it on”) and Poizon, which sell online and in physical stores. But what luxury houses can do is be part of the process — and in turn build relationships with customers who may eventually become buyers of new products.

The industry doesn’t need to look far for how this might work. There’s already a blueprint for turning resale transactions into a loyalty-building exercise. Rolex SA’s Certified Pre-Owned program allows authorised dealers to sell used watches that have been authenticated by the Swiss watchmaker, giving buyers greater confidence while bringing them into the brand’s orbit.

That reassurance matters especially in China, where fear of counterfeits remains one of the biggest obstacles to buying secondhand. More than 40 percent of complaints about pre-owned products two years ago centred around authenticity, according to the China Consumers Association. Resale platforms have invested heavily in authentication, but even expert appraisers can struggle to distinguish increasingly sophisticated fakes from the real thing. Luxury sellers have an obvious advantage. Who better to vouch for a handbag or watch than the company that made it?

Using secondhand as a gateway for recruiting buyers into a label is a logical strategy, Jacques Roizen, co-founder of Shanghai-based consultancy Foresight Performance Partners, told me. It’s a variation on a well-established approach of offering relatively affordable products that give consumers access to a brand without requiring them to buy its most expensive items. Chanel, for example, has opened a shoe boutique at Hong Kong’s glitzy IFC shopping mall in the Central district for this very purpose.

The entry-price tactic could take on greater importance if the recovery in China’s luxury market, the second largest in the world after the US, experiences another wobble. Although sales were buoyant earlier this year after the industry bottomed out in 2025, the outlook now appears uncertain. Business at two dozen of the biggest luxury labels, including LVMH Moët Hennessy Louis Vuitton SE’s Louis Vuitton and Kering SA’s Gucci, fell more than 10 percent last month, according to three research firms surveyed by Bloomberg News, after the government announced plans to reclaim tax revenues and curb capital outflows.

But none of this means Chinese shoppers are any less fond of luxury. The concept of “face” — how someone is perceived by others  — means a love of status symbols is baked into the culture. What has changed is how that desire is satisfied. They are simply switching to more affordable pieces, and that will ensure resale will continue to run rings around the rest of the industry.

While spending on new luxury goods contracted last year, the pre-owned trade expanded by 15 percent to 20 percent, consulting firm Bain & Co. reported, buoyed by livestreamers peddling secondhand wares. That was the fastest clip since 2020, when buying habits began to change. And there is plenty of room to run. The secondary market was less than 10 percent of China’s total luxury sector, compared with 35 percent in a more developed country like Japan.

For luxury houses, ignoring that shift would be a mistake. The Chinese consumer who buys a pre-owned Chanel bag or Cartier bracelet may eventually be in the market for a new, pricier one when finances improve. Helping to authenticate that purchase gives labels a chance to establish a relationship long before the buyers walk into a boutique. The challenge for brands is to meet shoppers where they are. Increasingly, that means starting with something that has already had an owner.

By Juliana Liu