Reasonableness of price rising above the hype of vintage and luxury goods among MZ generation

Maratova Meerim, Jihyeon Park

SEOUL - The protracted COVID-19 pandemic and inflation, which reached 5.7% in October this year, became the reasons for the rapid growth of the second-hand market. With rising inflation, the number of people willing to consume goods at a reasonable price has grown. Especially the demand for second-hand vintage and luxury items with a "standout", and "special" style has become a trend due to the MZ generation's tendency to want to be different. Such changes in consumers' behavior have led to the fact that even department stores selling mostly newly branded goods entered the second-hand market.

The Shinchon branch of the Hyundai Department Store was the first in the industry to open an entire 4th floor for the sale of second-hand vintage and luxury goods in September of this year. The “Second Boutique” includes second-hand platform-based brand “Market In U”, platform “Mevent” for used luxury goods, eco-friendly vintage lifestyle brand “Regresy”, and vintage watch brand “Seoul Watch”.

Young people looking around next to the statue of a pile of old clothes in the vintage shop

In the opinion of one of the visitors of the Market in U, the price aspect is the reason for the consumption of second-hand goods. He added that the main reason is that “second-hand products are cheaper than new", which corresponds to the Market In U's slogan - "better than new."

A woman checking the price of vintage clothes in ‘Market in U’

"This is where luxury goods are expensive. Is it reasonable?", mentioned another visitor of Second Boutique. A worker at Mevent shared how prices are determined for the second-hand luxury bags they sell: "Of course the prices we set in our store are important, but so are the overall prices in the used market."

People in different age groups are looking at vintage luxury products together

In the same month, a second-hand luxury store "Luxury Again" was opened in the Mia branch of the Hyundai Department Store. One of the workers of "Luxury Again" said that the age of visitors varies, ranging from 20 to middle age, and even older; in her opinion, they buy second-hand luxury goods because they are cheap and of good quality.

Another second-hand vintage luxury store “Luxury Again” in the Mia branch of the Hyundai Department store

Also, a handler who sells and purchases second-hand products said “the general price of luxury products has risen in the first place, it’s not strange that the price of second-hand luxury has too”, explaining their standard of setting prices on products.

A shop treating second-hand luxury products which also set prices on vintage products in the main street

As mentioned, there are differences in the view about whether the price of second-hand luxury products is reasonable between customers and sellers. Nevertheless, the growing market for second-hand luxury goods reflects consumers' ongoing consumption. Why does the MZ generation consume second-hand luxury goods despite different opinions on price, and what is the value of second-hand luxury goods?

A veteran craftsman at XAPA, a luxury goods repair center in LOTTE Premium Outlet Time Villas, said: “Consumers think that carrying a luxury bag, even if it is used, is better than buying dozens of general bags.” As a person who worked there for a long time, he added that consumers carry even repaired second-hand luxury bags because it shows the status of a person in society.

A veteran craftsman of second-hand luxury goods at XAPA consulting the client

Vintage goods are more expensive than regular second-hand goods due to their rarity and age. An employee of Market in U at Hyundai Department Store also mentioned that “the price of vintage can be expensive for some people and cheap for others. However, vintage is not simply old clothes, but the combination of brand value and rarity that new clothes cannot have, so it has a convincing value beyond reasonable price.”

Vintage & antique Italy and France cutlery for sale

Vintage shop MII-HA’s Pop-Up store in the Shinchon branch of Hyundai Department Store

According to the consumption theory, consumers want to get the maximum benefit at the minimum cost. Many people think that a reasonable price means a cheap price. Consumers' perceptions of prices can vary and customer satisfaction plays an important role in this. The value and satisfaction that a product brings, apart from the price aspect, is the reason why the market for second-hand vintage and luxury goods continues to grow today.