MARKETING RESEARCH: ASSIGNMENT 2

Submitted towards the partial fulfillment of the course of Masters of Fashion Management

DEMOGRAPHIC VARIABLES RELATION TO VARIOUS TYPES OF SECOND-HAND

LUXURY VALUE LIKE SOCIAL VALUE, UNIQUENESS VALUE AND QUALITY
VALUE.

Submitted by:
VRINDA GUPTA
(MFM/16/212)

Under the guidance

Dr. Santosh Tarai
(Associate Professor)

Submitted to:

Department of Fashion Management Studies

National Institute of Fashion Technology
(Ministry of Textiles, Govt. of India)
NIFT Campus, IDCO Plot No-24,
Bhubaneswar, Odisha-751024.
www.nift.ac.in

I.

OBJECTIVE
To study the attitudes of young people enrolled in fashion design, technology and
management towards second-hand luxury products sold through brick-and-mortar
retail versus online portals and compare it to the attitude of students enrolled in
another field of studies. To understand how demographic variables like gender, age,
and academia are related to various types of second-hand luxury value like social
value, uniqueness value and quality value.

II.

LITERATURE REVIEW
Luxury can be seen as a way of life. Bourne (1957) defined luxury goods as exclusive
products, which are not so commonly owned or used. But they are more visible and
symbolic than necessity products. They are mainly branded goods that are bought so that
they can satisfy the psychological needs of the consumer and also lead to an increase of
self- esteem. Such products are purchased mainly for social and individual needs rather
than functional needs that play a secondary role in purchase decisions (Arghavan and
Zaichkowsky 2000). Roux & Floch (1996) say that luxury is not just about price, but also
associated with pleasure, refinement, exclusivity and appreciation. A luxury product is
also characterized by very limited supply and recognition of value by other people.
Kapferer (1997, p.253; as cited in Vigneron and Johnson 2004) summarized luxury as
defining beauty, enlightening and providing good taste. Luxury brands can also be
described as premium or high priced brands that consumers purchase to satisfy their
psychological needs like materialistic, hedonic and social needs rather than for their
economical and functional value (Nueno and Quelch 1998). Even as premium global
fashion brands see India as a potential market, another segment in the Indian retail chain
is attracting global attention: The country has emerged as the biggest importer of worn
clothing and textiles. UN Comtrade data on global trade of worn clothes and textiles show
in 2013, such imports by India were worth $182 million, 4.3 per cent of the overall global
imports of $4,179 million, making India the top importer of used clothes. Russia and
Pakistan were second, accounting for 3.9 per cent of global imports each. The US, the UK
and Germany were the top three exporters. In 2012, India surpassed Russia as the largest
importer of used clothing, with imports worth $173 million. India had topped the list in
2009 and 2003, too, UN Comtrade data show. Between 2010 and 2013, the import of used

clothes and textiles increased about 200 per cent. Largely, the used clothes segment in
India is envisioned as serving the cause of charity, especially in African countries. In fact,
Panipat in Haryana is one of the largest suppliers of blankets made from second-hand
textile for charity across the globe. The demand for low-cost blankets and high-street
fashion brands from the West at throwaway prices is, however, no less in the domestic
market. Used clothes are imported into India under two categories wearable and
mutilated. The import of wearable clothes requires a license from the government, with
the condition of 100 per cent re-export. This segment accounts for about 30 per cent of
the imports. The governments approval isnt required to import mutilated clothes, which
account for about 60 per cent of worn clothing imports. Yarn extracted from mutilated
rags and woolens is used to make blankets, sold at about Rs 80-100 each in the open
market. Used wearable clothes enter the Indian retail market through two channels: First,
smuggling from special economic zones (SEZs). Domestic apparel manufacturers say as
much as 30 per cent of the imports into the SEZs are smuggled into the domestic market.
The second channel is payment of a paltry penalty of Rs 50 a kg at custom checkpoints.
By comparison, new imported garments attract an import duty of 15 per cent. Rahul
Mehta, president of the Clothing Manufacturers Association of India, says the government
is considering increasing against the number of licenses for the import of wearable used
clothes from 22 (20 in the Kandla SEZ and two in Falta) to 200. The move could flood
the domestic market with used clothes from the West. In a recent letter to the Union
textiles ministry, the association had written, We understand a meeting was held on July
4, 2015, in the commerce ministry, wherein a decision has been taken to liberalize the
import of un-mutilated worn and used clothes by releasing about 200 licenses in all SEZs
in India. The issuance of fresh licenses will substantially hurt the domestic textile and
apparel sector. The association estimates as many as 57.6 million garments enter the
retail market every year through each licensee, for resale through illegal channels from
SEZs. In September 2014, the government had allowed up to 15 per cent of the used
wearable clothes export surplus to be used in the domestic market. This was, however,
rolled back in January this year. In a research paper titled The limits of ethicality in
international markets: Imported second-hand clothing in India, Lucy Norris, a researcher
in the department of anthropology, University College London, writes Panipat is home to
the worlds largest shoddy wool sector, supplying low-quality blankets to the poor across
India, South Asia and East Africa.

Selling old clothes to fund new purchases or buying little-used designer wear are no
longer done furtively. Re-commerce sites, which sell pre-owned luxury and high-street
apparel, footwear and accessories, are slowly catching on among fashionistas who want
the best brands without burning a hole in their pockets. As the desire to flaunt that Chanel
or Burberry is curing Indians of their queasiness about wearing cast-offs, more than a
dozen startups are tailoring businesses to suit a growing clientele. Indian reselling sites
and apps such as Confidential Couture, Elanic, Spoyl, Envoged, Zapyle and Refashion
have drawn inspiration from international luxury second-hand marketplaces like Rebagg,
Poshmark and Tradesy, and are challenging regular e-tailers such as Myntra, Flipkart,
Amazon and Jabong. "The market is as large as $2 billion a year and we have seen a surge
in the user base as well as transaction rate," says Aditi Rohan, co-founder of Elanic, an
app-based platform to re-sell "gently-worn" apparel, which was started this September.
She says they have 30,000 users and get about 300 to 400 listings of items a day. Elanic
received seed funding from Rebright Partners, Traxcn Labs and angel investor Aneesh
Reddy "We are looking at extending our product line-up from just fashion to accessories
for women and products for men," said Rohan, who is aiming to clock 2,000 listings a day
by next month.
It's a fairly simple system: A seller posts clothes or shoes that she no longer wants online,
the re-seller picks up the products, checks, cleans, re-packs and prices the items -- often at
as little as 50% of the original cost (imagine a Burberry with a boutique price of Rs
85,000 going for under Rs 20,000) and puts it up for sale, where a buyer can negotiate
further on the price. The site gets a commission of 15% to 20% on every transaction.
The challenge, though, is ensuring authenticity, quality and cleanliness, and making sure
the clothes look as good as new. "Ensuring authenticity and quality is a big driver to
sustain growth in the long term for us. We have 1 lakh registered users with average
transaction size of Rs 5,000 to Rs 6,000, but logistics is a challenge as we have to pick up
products from sellers, make sure they are in good shape and ensure smooth delivery," says
IIT Kharagpur alumnus Anandita Singh, co-founder of Envoged, which sells pre-owned
luxury fashion. To the surprise of most founders, a significant number of sellers and
buyers are from tier II and tier III towns, which are why many of them are planning to
expand operations to cities like Ahmedabad, Ludhiana and Chandigarh. The
entrepreneurs, however, agree that the current user base is inclined towards sellers. "There
is more supply than demand at present but that will change over time," says Singh. Some
sellers are creating a whole range of products online and waiting for buyers.
Alok Mittal, an investor in Envoged, says younger people have no inhibitions about pre-

owned products. "A 20-something can't afford a Gucci on her own salary," he explains.
"Once they have a good experience and as the inventory on these sites improves, buyers
will return. It is a natural process of evolution." Abhishek Goyal, founder of Tracxn and
an angel investor in Elanic, says the market has potential to scale. "It could be even 10%
of the overall retail market," he says. Both Goyal and Mittal say the companies need to
generate users' trust by ensuring quality, especially since the model is in the nascent stage
and is unproven.
What Goes Around Comes Around (WGACA), where absolutely everything for sale is
second-hand or rather, luxury vintage. A recent boom in enthusiasm for vintage fashion
has led to a rapid expansion for stores such as WGACA and growing profits, even when
global fashion brands are faltering. In fact, its merchandise assortment is even more
exclusive and thrilling to shoppers than many offered by neighboring stores. That Chanel
selection We have the largest collection of vintage Chanel in the whole world,
Weisser claims will include dozens of noteworthy bags and clothes from Karl
Lagerfelds stint as head designer, as well as sought-after, discontinued pieces from its
costume jewelry range. As for the Herms "concession," the centerpiece when it opens
will be a Himalayan crocodile Birkin; a similar model sold for $185,000 at auction two
years ago. You simply cant walk into an Herms store anywhere in the world and expect
to be able to walk out with one of these, now matter how much you are willing to pay.
Vintage Is Booming WGACA isnt the only superior second-hand operation in the area:
Indeed, Ben Hemmingers Fashionphile has been selling top tier, gently used designer
purses by Dior and Louis Vuitton from a jewel box-sized showroom in Beverly Hills
since 2008. Its tucked into an alleyway at the end of the same block as WGACA, less
than 500 feet from an enormous branch of Barneys. Actually, our showroom is right next
to Louis Vuitton our garbage can is the same as theirs, Hemminger laughs, speaking
by phone from the firms warehouse headquarters in Carlsbad, California. Both firms are
booming: Weissers plush new site is 25 percent larger than its previous location in a busy
block of La Brea, while Fashionphile logged $3 million in sales in February 2016, its
strongest month ever, and business grew 50 percent to 60 percent year over year in 2015.
They are prime examples of the new retail sector of luxury vintage, in which barely worn
bags or designer dresses are sold at discount to women who might have shopped straight
from the runway. They occupy sites adjacent to full-price rivals; sometimes, they even
supply them. Weisser has contracts with such department stores as Lane Crawford in
Hong Kong and Barneys in Japan to supply authentic, top-tier vintage for their sales

floors.Online Competition Is Growing Online counterparts are jostling for the same
business: Both TheRealReal and MaterialWorld operate similarly, trading on the
newfound cachet for used clothes. The booming industry of prime vintage has been
buttressed by the emergence of handbag-centric auctions such as those at ArtCurial in
Paris or Fine Art Auctions in Miami. Christies was so keen to enter the luxury vintage
business that in 2014 it poached the wunderkind head of Heritage Auctions bag-selling
department, a twenty something Matt Rubinger. Heritage perceived the defection as such
a blow that it sued Christie's for $60 million. Its still startling, though, to see a secondhand store even one with such blue chip, red carpet credentials (Rihannas a regular) as
WGACA snap up prime retail space in Beverly Hills. Stylist Lauren Goodman
suggests that this wont be the last vintage tenant roped in by Rodeo Drive. She points
out that much like fine wine; top-tier vintage clothes and accessories often appreciate in
value. You could buy a vintage Versace dress from the 1990s, wear it five times and
resell it, and its probably gone up a little bit in value. I mean, everyones obsessed with
the '90s right now, Goodman says by phone from her home in San Francisco.
(Remember the headline- making, albeit exaggerated claim that a Birkin bag by Herms
was a better investment than gold) New Stuff Is More Expensive Now, Too Goodman
adds that the lure of vintage is also driven by the rising prices of new merchandise.
Designer labels have deliberately hiked prices of core items over the past decade or so;
the cost of Chanels bags, for example, raises an average15 percent annually. It makes
vintage feel better value than ever, and its already survived the test of time. Michael
Tonello, who wrote the memoir Bringing Home the Birkin about his time as a Herms
reseller, agrees. Ten years ago, a nice designer shirt was a couple hundred bucks, he
says by phone from his home in Barcelona. Now, you look in a store window and every
price has a comma in it$1,000 or more. Other cultural and economic shifts are helping
to bring WGACA and Fashionphile to the fore. Instagramming from the front row of a
show might earn editors a few extra followers, but it softens the excitement that once
surrounded the delivery of new clothes to a retailer, notes Goodman. By the time
someone wears a look from the runway out to a party now, the clothes already feel like
last season. But if its vintage, it will exist outside of this cycle and won't have been liked
5,000 or 25,000 times on Instagram already. Its special, unique, and its yours. You are
making a bold, personal style decision. This same impetus lay behind Burberrys
decision to create runways with instant buying options, starting in September. The Threat
of Fraud it might seem that the rise of luxury vintage is unstoppable, but a danger looms

that could derail the entire industry: fakes. The resale market is lucrative and generally
un-policedcharges around selling fakes are usually pleaded down to disorderly conduct,
resulting in minor fines and no jail timeso its ripe for unscrupulous exploitation. The
situation is made trickier by the emergence of a new class of counterfeits known as
superfakes, essentially production overruns stolen from the factory and indistinguishable
from authorized merchandise.
Its a threat that WGACAs Weisser takes seriously. We handle more of this product than
anyones ever seen, so we get a very good comfort level on how to spot a fake. Our senior
buyers are like scientists, and they will get down to counting stitches or even using
techniques wed prefer not to disclose.
According to Scitovsky (1992) belonging to groups is a necessary and psychologically
satisfying behavior for humans. Within these groups individuals emulate each other in
order to be accepted as a group member but they also seek to be distinguished and
recognized within the group (Scitovsky, 1992). Need-for-status is the motivational
processes by which individuals strive to improve their social standing through
conspicuous consumption of consumer products that confer or symbolize status for both
the individual and surrounding others (Eastman et al, 1999a, p. 41). Consumption is used
by consumers to cement and improve their place in the social hierarchy and is a
motivating force behind the purchase, use, display and consumption of certain goods and
services (Eastman et al, 1999b). Han et al (2010) found a relationship between an
individuals need-for-status and their preference for brand prominence on luxury fashion
goods.
Status has its roots in ancient society, in which every person had a place in the social
hierarchy. Historically, this place was attained either through birth (e.g., born into nobility
or an upper class in the caste system) or by ordainment (e.g., knighted by the king). This
changed during the Age of Enlightenment (roughly the beginning of the eighteenth
century) as a persons worth began to be judged according to his or her achievements,
which frequently brought great wealth (De Botton 2004). A reliable connection was made
between merit and worldly success; well-paid jobs were secured primarily through
intelligence and ability. The rich were not just wealthier; they were better. They merited
their success, and as such, affluence increasingly became a marker of social status. Wealth
and social status have been inextricably linked ever since.
If virtually everyone owns a particular brand, it is considered to be non-luxury (Thuy,
2008). Uniqueness is based on the assumption, demonstrated in research, that the
perceived exclusivity and rareness of the product enhances a consumers desire or

preference for it (Verhallen, 1982; Pantzalis, 1995). Furthermore, this desire increases
when the brand is also perceived as expensive (Groth and McDaniel, 1993; Verhallen and
Robben 1994). Therefore, the more unique a brand is deemed, and the more expensive it
is compared to normal standards, the more valuable it becomes (Heidarzadeh and
Teimourpour, 2011; Verhallen and Robben, 1994).

QUESTIONNAIRE

I, Vrinda Gupta, a student of Masters Of Fashion Management, 1st Semester

would like your opinion on below queries to conduct a survey and to
determine the potential and awareness for Second-hand luxury goods market
in Patia, Bhubaneswar. Please help to take some time out of your busy
schedule to fill up this questionnaire.
1)
2)
3)
4)
5)
6)
7)
8)

Gender: Male____ Female____

Age: 18___19___20___21___22___23___24___25___26___
Marital Status: Single____Married____
Field Of Study: Fashion___Engineering___
Education: Graduation___Post-Graduation___
Expenditure on Clothes in a year: ____________________
Clothes preferred: Branded____Un-branded____
Would you prefer to buy authentic second-hand luxury goods
from a store: Yes____No____

If yes, please help to accord ratings to below statements (Rating of 5 =

Very Likely, 4 = Seems Likely, 3 = No comments, 2 = Seems Unlikely and
1 = Very Unlikely):
Statement
If I buy
second hand
luxury
goods, I
will buy
those
known by
many
people
Second
hand luxury
goods can
also be a
symbol of
status
I will lose
interest in
Second
hand luxury
goods
purchased
by general
population
Products
superior
quality is
the reason I
buy secondhand luxury

goods
My decision
for
purchasing
is affected
by quality
and not by
others
preference
I experience
gratification
and
satisfaction
by
purchasing
secondhand luxury
goods
I feel under
pressure to
own highend brands
hence prefer
purchasing
them at a
lower price
People who
are
important to
me want me
to purchase
luxury
goods
My friends
would
prefer that I
buy luxury
brand

REFERENCES
1. Brand Prominence on Luxury Fashion Goods: The Preferences of Fashion Change Agents
versus Fashion Followers Zoe Thwaites, Curtin University, Australia.Graham Ferguson*,
Curtin University, Australia.
2. Signaling Status with Luxury Goods: The Role of Brand Prominence Young Jee Han,
Joseph C. Nunes, & Xavier Drze
3. Investigation of the effects of luxury brand perception and brand preference on purchase
intention of luxury products Kambiz Heidarzadeh Hanzaee* and Fereshteh Raeis
Rouhani Department of Business Management, Science and Research Branch, Islamic
Azad University, Tehran, Iran.
4. Second-hand market to cross Rs 1,15,000 crore by 2015: ASSOCHAM Economic
slowdown creates higher demand for second-hand goods and machinery The Associated
Chambers of Commerce & Industry of India
5. Demographics and Lifestyle Analysis
6. Identification and Motivation of Participants for Luxury Consumer Surveys Through
Viral Participant Acquisition Klaus HeineTechnical University of Berlin, Germany
7. Global Mode: Secondhand Luxury ACADEMIC RESEARCH & RELATED,
INTERNATIONAL FASHION
8. Consumers Experiences of Luxury Interpreting the Luxuriousness of a Brand LINDA
LISA MARIA TURUNEN
9. Attitudes of young Indian consumers towards luxury brands Dr. R. Srinivasan, Dr. R.K.
Srivastava & Prof. Sandeep Bhanot
10. The Less Conspicuous Road to Virtue:The Influence of Luxury Consumption on Socially
Valued Behavior Keith Wilcox Henrik Hagtvedt Bruno Kocher*
11. Pre-loved luxury: identifying the meaning of second hand luxury possessions Linda Lisa
Maria Turunen and Hanna Leipmaa-Leskinen Department of Marketing, University of
Vaasa, Vaasa, Finland
12. Who You Are Affects What You Buy: The Influence of Consumer Identity on Brand
Preferences By Morgan A. Ilaw 2014, Vol. 6 No. 11
13. The future of global luxury fashion: Growth, Source of design and inspiration, and prime
markets for the sales of luxury goods Rosalie J. Regni
14. Understanding second-hand retailing: A resource based perspective of best practices
leading to business success Jinhee Han
15. Inside the Booming Vintage Luxury Fashion Market BY BLOOMBERG
16. India emerges top importer of used clothes Namrata Acharya
17. Pre-owned luxury brands breathe second life By Minal Sancheti
18. Resale sites boom as shoppers buy with reselling in mind THE ASSOCIATED PRESS
19. Selling second hand goods from luxury brands becoming big business in India Digbijay
Mishra & Anand J | TNN

20. The second-hand market: what consumers really want to buy Mindy Chahal