This week California-based fashion marketplace Poshmark announced they hit a major milestone since launching the marketplace in 2011.
The company revealed they paid out $1 billion to its community of over four million Seller Stylists. On Poshmark, a Seller Stylist is not just a seller, but they are able to use the marketplace to curate looks.
Some sellers only sell second-hand clothes right out of their closets. But others are selling from their own retail boutiques or are building brands that can also be distributed through the company’s Wholesale Portal.
The Poshmark Wholesale Portal is a place in the Poshmark app where qualified sellers can offer the products to retail buyers or even other Poshmark sellers to sell in their Poshmark Boutiques.
It is a bit similar to the Etsy Wholesale program that recently seems to have stalled out a bit as Etsy is concentrating on expanding the marketplace front end.
On the fashion marketplace, people share style advice while buying and selling items through virtual and physical Posh Parties. These are real-time shopping events where shoppers meet up to shop, share, and sell clothing and accessories.
“We are creating the next generation of fashion businesses. Our Seller Stylists have redefined the fashion landscape by leveraging social selling to build a community centered around style and sharing.”
Manish Chandra, founder, and CEO of Poshmark
The combination of social interaction and shopping is very popular in China and Alibaba Group trough its Taobao app has grown to about a half billion users.
Poshmark is using the same concept in its marketplace to create a highly addictive social shopping and selling experience.
The company claims its community spends approximately 25 minutes per day in the app, opening it seven to nine times. These are similar statistics to Taoboa as revealed by Alibaba Group in 2016.
And the community uploads over $100 million of inventory to the platform each week and curates 14 million items daily, resulting in a sale made every second.
Most social shopping in the U.S. is still very much through Instagram and Facebook. It is not really a truly collaborative experience and even Amazon’s attempt at social shopping, called Amazon Spark, has not sparked to build more interest in social commerce here.
Personal versus Personalization
It seems nuanced, but there is a difference between the two as online retailers try to find ways to promote personalized shopping feeds through machine learning.
In personalization, the sellers are more of an advisor, helping shoppers to build their style. This is why Poshmark calls them Seller Stylists, not just sellers.
The company claims that some Seller Stylists are generating six to even seven-figure earnings from their one-on-one connection with shoppers.
“Thanks to Poshmark, I’ve been able to turn my love of fashion into a seven-figure retail business. I’m able to get to know my shoppers on a personal level and curate looks to meet their needs, resulting in a loyal community of shoppers that can’t be found elsewhere.”
Suzanne Canon, Poshmark’s first Seller Stylist to make $1 million
Unique Business Model
Just like some folks have become major influencers on social media and are able to make money promoting products to their followers, Seller Stylists are at core the same, influencers.
The unique business model of Poshmark allows these influencers to have a captive audience and if they are able to help people build style, they grow followers on the marketplace.
In that regard, success on Poshmark is very much reliant on social media prowess by building followers and selling followers products.
Additional Sales Channel Opportunity?
Because of the unique business approach of Poshmark, business sellers that are already active on eBay, Amazon, Etsy and other marketplaces may need to consider what it takes to become successful on Poshmark.
It is a different approach to selling, one that will require a personal touch and lots of hours of curating and managing feed content.
The marketplace does not appear to have an API. So automation is virtually impossible, including shipping and inventory management through third-party shipping tools.
Poshmark supplies USPS labels to sellers when an item sells and currently the marketplace only serves the United States.
An existing small business that utilizes multi-channel and order processing software to manage sales channels such as eBay, Amazon, or Etsy is going to have a hard time putting Poshmark into that workflow.
But Poshmark may still be worth a consideration as a separate independent “division” within an existing eCommerce business. For fashion and style sellers willing to dedicate a person and product line to just Poshmark, it could result in a profitable sales channel.
Sellers engaged in Fast Fashion could also find an opportunity to use Poshmark to sell remaining pieces to close out inventory.
Not through a discount strategy, eBay is probably better for that, but by promoting products in online Posh Parties and curating feed content.
One final point of consideration for business owners. In the last five years, Poshmark has grown tenfold in gross merchandise sales and revenue, and that is hard to ignore.
Have you tried Poshmark? We’d love to hear your experience with the marketplace. Head over to our Facebook Discussion Group or use the comments section below.