Who Sets the Price of Fashion?
Having trouble finding the Nike SB Dunk Low Travis Scott, a Rolex GMT-Master II ‘Pepsi’, or a limited edition Louis Vuitton by Virgil Abloh duffle bag, at a price that doesn’t mean restructuring your finances? Want to pre-order the latest Jacquemus menswear collection months before it hits the shop floor?
A new global luxury retail app is about to solve this problem. THE LIST wants to rethink the way we shop luxury and how we think about it. From Andreas Skorski, a Dubai-based German entrepreneur, the app looks to bring you, the shopper, coveted products without having to acquire VIP status, linger in waiting lists, or fall victim to inflated resell prices.
“Fashion has evolved into a very high-speed game which is continuously restocked and oversupplied. This isn’t the nature of luxury in itself. It used to be preciousness and lesser quantities,” Skorski tells us in a first exclusive interview.
To combat the pace of luxury and to change how we think about the price we pay for goods, THE LIST is now launching an Initial Product Offering model. Not your traditional IPO on the stock exchange, this one releases limited quantities of new collections, products like the Nike Air Max 2 or vintage gems from Chanel for a limited time only where the price of products will fluctuate — changing every three seconds — according to the dynamics of existing demand, available supply and remaining time window, as determined by the company’s artificial intelligence technology which reads the market. The move could entirely disrupt the way we buy hyped products.
In the three seconds, the artificial intelligence will collect over 100,000 data points meaning that over the course of a product offering, the app can gather data about where, what, and when consumers are buying which means that as time goes by, the products offered to you are increasingly aligned with what you actually want.
“If we give our customer what they truly desire, instead of bringing them into a catalogue with discounts and where marketing dollars try to convert them, then those customers are actually buying something with consciousness and they might even spend more because it’s something they desire. It’s not an impulsive purchase,” says Skorski.
The idea is that if you’re quick enough to an IPO, you might make a good investment on products that might otherwise be unavailable or inflated. If you’re early, you might buy hard-to-find products close to retail prices or at fair market value, instead of the overblown secondary marketplace. If you’re later, you won’t get the same price, but you can still cut a deal. In the case of low demand for a product, the price will lower accordingly.
The app’s aim is to restore preciousness to luxury by tackling retail’s oversupply problem. Skorski is sceptical of the overabundance of choice on e-commerce sites and how the secondhand market drives up prices on resale websites within minutes of drops. On the app, he hopes to bring customers small quantities of much-coveted products at retail prices or slightly above, but always better than resale. Moreover, through artificial intelligence that reads the market, the app will sell an assortment of what the consumer really wants as opposed to what they might want.
"We don't want to run out there and tell big stories and whatnot. We want to focus on delivering and building a good product,” says Skorksi.
Skorski envisions the app as “a home for everyone who has a certain eye for design and luxury quality.” He asserts, “we aren’t trying to position ourselves to target one niche customer.” Hence, it becomes a marketplace where scarce Patek Philippe watches and Hermes ‘Kelly’ bags live alongside new season accessories and some accessible sneaker finds like the Nike Air Max 2 CB 94 Triple Black.
“We took a lot of time on figuring out how the market works, what it needs, and where we're heading next, and building a rock solid product that we deliver to 190 countries, all inclusive of taxes and duties as well,” says Skorski.
Born to Polish parents in Germany, Skorski was entrepreneurial from a young age. At just 17, he launched a fashion magazine where you could scan the advertising pages with an interactive app. By 19, he sold the company, launching THE LIST six years later, when he was 25, in 2016. The impetus for the app was moving to Dubai where Skorski could not find the right products he wanted to wear in Middle Eastern malls. He would buy what he liked on trips to London, Berlin, and Milan and his peers grew increasingly interested in his findings, asking him to bring back items which were cheaper than Middle Eastern rates and at the time impossible to find locally.
In 2016, he combined his technology know-how with fashion marketing expert Alexandra Valtin who would become the brand’s first Chief Brand Officer, along with people who worked across tech, customer service, and marketing formerly of Farfetch and Yoox Net-A-Porter / at other online retailers. Together, they launched a marketplace model which directly connects brands and retailers with the end consumer on one platform. By 2018, they catered to over 40 countries.
Skorski understood that supply and demand at e-commerce sites is skewed and is ripe for disruption, especially in the men’s space. Most retailers offer the same products which leads to customers comparing rates on different sites. After conversations with consumers, he realized that they are prepared to spend on products they actually desire rather than falling into the trap of impulse buying.
“Fashion and luxury have changed. People want uniqueness and we try to give them that by allowing them to combine things, especially in a marketplace where you can drop everything into a basket from, say, a small brand in Tokyo to a big brand in Italy or the US,” says Skorski, pointing to overproduction as a retail’s greatest threat which leads to a consumer sentiment that is largely shaped by where and when they can acquire discounted products.
And technology is intrinsic to the app. Skorski relies on intelligence-based data to find out what products consumers desire and curates a globally-sourced selection of them on one platform. The products available on the app are sourced via a professional supplier network of retailers, brands and individual sources around the globe that are scouted and acquired by an inhouse team based in Lisbon, Portugal.
Technology creates a level of trust between THE LIST and the brands and retailers that have partnered with the company. While prices can rise or fall on the app according to demand and supply, retailers can learn from the data that the app collects and, in turn, make available the products that are most likely to sell.
Moreover, if a new season collection arrives at a store connected to the app, the app’s technology automatically uploads this inventory cutting down on time spent sending products to other marketplace-based e-commerce sites, thus extending the full-price sales window, reducing overheads and overproduction, and increasing profit margins, for brands. In this instance, the value of a luxury good is not diminished by the usual circumstances.
“We’re a software company,” says Skorski. “We’re a marketplace and we’re dealing with luxury goods but we have no inventory so we never see an item, we utilize technology in every aspect. We only focus on mainly building great software.”
The app comes at a time when the global retail industry is experiencing a great deal of upheaval. A recent Boston Consulting Group study reports that fashion retailer sales are expected to contract by as much as 35 percent in 2020 compared to the previous year. Another report from The Business of Fashion and McKinsey & Co forecast that the personal luxury goods industry is expected to plummet by up to 40 percent this year.
While there are worrying signs in the industry at large, Skorksi remains hopeful. He hopes that as THE LIST commits to deliver products consumers actually desire as opposed to ones that they think might sell, in a manner that is true to the market value, the new app could become a game-changer in how luxury is sought, and ultimately purchased.
“It started with just the fact of bringing luxury online, and then obviously direct to the consumer, with a lot of brands trying to reach the customer as well. But now it's time. If you really want to win the market, you need to reinvent the game.”
