South Korea’s platform giant Naver Corp. is on the move to claim the throne in the sneaker resale market, up against other fashion platforms such as Musinsa Co. which is also ramping up efforts to become the market frontrunner.
On Aug. 26, Naver's sneaker resale platform Kream acquired a popular online resale community, Nike Mania, for 8 billion won ($6.9 million), stirring up chatter among the fashion industry that Naver is pushing to solidify its lead in the sneaker resale market.
According to fashion industry sources, Naver's decision to acquire Nike Mania is to gain an upper hand in user acquisition, a core element for any given platform. Kream has around 450,000 users and the platform is hoping to increase its market share through Nike Mania, which has over 1 million users.
Founded in 2004, Nike Mania has pioneered the resale market for sneakers, becoming the largest online community for limited-edition sneakers in Korea. And through the acquisition, Kream is hoping to cement its position as the resale market frontrunner.
Currently, the resale market for limited-edition sneakers is largely divided between Naver and Musinsa. Naver first tapped into the sneaker resale market in March 2020 when it launched Kream through its subsidiary platform, SNOW. Four months later, fashion platform Musinsa joined the scene by establishing SoldOut, an e-commerce platform for selling limited-edition sneakers.
Both of the resale platforms have hired professional inspectors to spot fakes and verify products' authenticity, thereby boosting their credibility.
As Naver works to maintain its leading position, the No. 2 player Musinsa is preparing for a fight by carrying out a complete overhaul of its app and launching aggressive marketing efforts to expand its user base.
Meanwhile, the fierce battle between Naver and Musinsa has caused smaller resale platforms to shut down as they are unable to survive amid the intensifying competition. Also, some have criticized Naver's acquisition of Nike Mania, stating that it's absurd to purchase an online community while some users have departed to set up their own community.
Major platforms' interest in the sneaker resale market is owing to its growth potential. According to the US investment bank Cowen and Company, the global sneaker resale market is expected to reach 7 trillion won ($6 billion) by 2025, driven by millennials and Gen Zers who are used to buying and selling expensive brands and limited-edition sneakers. Currently, the domestic resale market for limited-edition sneakers stands at around 500 billion won.
Write to Jeong-cheol Bae at
bjc@hankyung.comDanbee Lee edited this article.
