Will preowned Ikea recycle eBay?
The Swedish giant launches Ikea preowned, an e-commerce where customers can sell and buy used furniture, a rapidly expanding market that has so far been dominated by a few players. Among which the main one is eBay. All the details
Sustainability and competition are the words that guide Ikea preowned, the new project by the Swedish giant that allows customers to buy and sell previously purchased furniture. It will initially be tested until the end of the year in Oslo and Madrid and has the declared aim of breaking the "monopoly or oligopoly of e-commerce platforms", mainly eBay.
HOW IKEA PREOWNED WILL WORK
On Ikea preowned, customers enter their products , with photos and a sales price, while the Ikea database, equipped with artificial intelligence, inserts their promotional images and measurements. The buyer can then collect the furniture directly from the seller, who can choose whether to be paid in cash or with an Ikea voucher which also includes a 15% discount to be spent in the group's stores.
Currently, writes the Financial Times , the first offers on the platform include large items such as sofas for up to 600 euros and wardrobes for 450 euros, but also smaller items such as a toilet roll holder for 4 euros. Advertisements are free, said Jesper Brodin, chief executive of Ingka, the main operator of Ikea stores, but "a symbolic fee" may be required in future.
In the past the company had proposed something similar, purchasing used furniture from customers and reselling it in the store, but the new platform is much more ambitious and aims to enter the second hand market.
THE NUMBERS OF SECOND HAND SOLD BETWEEN PRIVATE INDIVIDUALS
According to Brodin, the trading of second-hand goods between customers who sell directly to each other is a sector in which Ikea would have "a higher market share than that of sales of new furniture".
Furthermore, according to data from StraitsResearch cited by Repubblica , the global second-hand furniture market has "exceeded 38 billion dollars in value in 2023, but is expected to substantially double above 75 billion between now and 2032, with growth annual average of almost 8%”. In Italy, adds the newspaper, the second hand market as a whole – not just furniture – is worth 26 billion.
BREAK THE MONOPOLY
In this sector however, Brodin explained, “very often there is a monopoly or oligopoly on the platforms that operate”, referring to eBay and digital classifieds services such as Gumtree in the United Kingdom and Finn in Norway. Finn himself, reports the Financial Times , offers 8,700 Ikea items listed in Oslo alone.
“We will verify the entire scope, also from an economic point of view – he added -. If many people use the offer to get a discount with Ikea, it is a good way to reconnect with customers. I'm very curious. I think it makes sense from a business perspective.”
THE TRANSFORMATION OF IKEA
The new marketplace is part of a transformation process started years ago by Ikea, which went from being an out-of-town retailer where customers had to take and build their own furniture to a company that offers online sales, shops in the city center and services such as assembly.
The pandemic was certainly a turning point: “For us it was a question of survival – explained Brodin -. We were 100% closed. Digital transformation saved us." And in fact the launch of online shopping around the world which should have taken place between 2020 and 2023 took place in six weeks.
Now the arrival in second-hand is the latest innovation but over the years it has already tested other forms of sales, for example on third-party platforms such as Alibaba's Tmall in China.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia-on-demand/ikea-preowned-riciclera-ebay/ on Tue, 27 Aug 2024 14:03:37 +0000.