From wine to watches, sharing sites offer slice of luxury

FAN Editor
FILE PHOTO: A watch model by Konstantin Chaykin that resembles a smiley and is part of the charity auction
FILE PHOTO: A watch model by Konstantin Chaykin that resembles a smiley and is part of the charity auction “Only Watch 2017” is pictured during a preview of Christie’s auction sale in Geneva, Switzerland November 8, 2017. REUTERS/Denis Balibouse/File Photo

December 20, 2017

By Sarah White and Silke Koltrowitz

PARIS/ZURICH (Reuters) – Online platforms offering rentals or shares in everything from glitzy watches to sports cars are making inroads in the luxury goods market, as a shift in consumer habits begins to head up market.

Playing off the sharing economy model popularized by the likes of Airbnb, such companies invite people to enjoy luxury brands without spending a fortune. For example, a fixed monthly fee gives a consumer use of a Rolex watch for a few weeks which they then send back to exchange for another luxury brand.

Businesses say the market for renting or co-investing in everything from jewelery to fine art is taking off with moderately well-off clients aspiring to a taste of the high life, and potentially the seriously wealthy.

“The modern generation leads a very different life, people want to keep their options open,” said Marco Abele, who formerly worked in digital banking at Credit Suisse and is now developing sharing platform TEND, set to launch in Switzerland in March.

The platform offers people ways of buying tradable stakes in a Porsche or a vineyard, for a return on their investment and a chance to go for occasional spins in the car or get customized bottles.

While aiming to “democratize” luxury, its target customers are not quite every man or woman: their net worth would be around 100,000 to 1 million Swiss francs ($1 million), Abele said.

While still small, the sharing economy is predicted to grow from around $15 billion in 2016 to $335 billion by 2025, according to PricewaterhouseCoopers. Luxury is only a small part of that but has potential.

“It’s not a significant market, but it’s getting under way, it will become more significant,” said Olivier Abtan, a luxury specialist at Boston Consulting Group. “There are a lot of start-ups and especially young people piling into this.”

Eleven James, a U.S.-based watch rental site launched in 2014, is considering moving into jewelery and artworks and may expand overseas, Chief Executive Olivier Reza said.

The company – whose monthly fees range from $150 to $500, depending on the value of the watches – used to rent out its own stock. But in November it opened up to collectors wanting to lease their timepieces.

“This mainly came about because of consumer demand,” Reza said. “People have more watches, they can’t wear them all at once, they tire of them.”

TEST BEFORE BUYING

For some luxury manufacturers, this budding market may be an unwelcome development.

They had only just started to make peace with e-commerce, having long been afraid that online sales might dilute their brands, and are still fighting to control distribution, resisting moving onto mainstream sites such as Amazon <AMZN.O>.

Now they run the risk of missing out on sales as people rent a piece of the luxury they offer, making items more accessible – and ubiquitous – undermining their exclusivity.

Still, rentals of evening dresses or designer items by Chanel or Louis Vuitton have long existed, as have co-investments in assets including private jets and yachts. Online platforms offer a means of rapidly expanding such services.

For watch enthusiast Chi Chan, 43, a New York-based IT developer who has consigned four watches to Eleven James, the rental site is an easy way of testing before buying.

“It is very intimidating sometimes to go to a boutique with the salespeople judging you,” said Chan, suggesting online leasing was less pressured.

(Editing by Luke Baker and Robin Pomeroy)

Free America Network Articles

Leave a Reply

Next Post

SpaceX unveils world's most powerful rocket

SpaceX founder Elon Musk posted the first pictures of the company’s Falcon Heavy booster Wednesday, showing the powerful rocket in its hangar at the base of historic launch pad 39A at the Kennedy Space Center where it is being readied for a long-awaited maiden flight next month. The payload for […]