What if online marketplaces conducted sales like a stock exchange?
Described as the first online consumer “stock market of things,” StockX is a new online marketplace that promises to bring the transparency and efficiency of equity trading to the online sale of high-end, limited edition items.
The Detroit start-up will initially focus on collectible sneakers in a partnership with Campless.com, which since 2012 has built a wealth of information on sneaker prices by tracking re-seller activity on eBay auctions.
EBay controls about a third of the secondary sneaker market. The remainder of sales come mostly from niche websites and urban shops, as well as individual re-seller websites.
One major advantage of StockX over an eBay-like auction is transparency. Participants in the StockX exchange can find historical price and volume metrics, real-time bids and offers (asks), time-stamped trades and additional analytics on every sneaker model presented on the marketplace.
While prices can range widely on an auction-type site, the transparency helps set a “fair price” for both sellers and buyers. Like equity stocks, prices move higher or lower based on bids and asks.
The other benefit is trust. On eBay, a buyer has to trust a seller’s rating and manage any problems directly with the seller.
On StockX, all sales are anonymous, with StockX serving as the middleman between buyer and seller. When an item is sold, the seller ships the item to StockX’s facilities where it is authenticated and then shipped to the buyer. Beyond helping avoid counterfeits or any product quality issues, StockX helps buyers avoid any surprise shipping charges or delays that often come with auction purchases.
The start-up will initially focus on proving its model in sneakers but eventually explore women’s handbags, watches, comic books, baseball cards, coins and secondary sales of other non-commodity items.
“We are going to bring the kind of trading platform and visibility to tangible products that financial and commodities markets have used for decades,” said Dan Gilbert, the founder of Quicken Loans who is a major backer. “We believe this is the right time to extend this fundamental concept to appropriate sectors of the online consumer marketplace.”
- World’s First Online Consumer “Stock Market of Things” Launches – StockX
- Gilbert launches StockX, the ‘stock market of things’ – Detroit Free Press
- Detroit native starts online marketplace for high-end items – Washington Times
- Dan Gilbert And Campless Founder Launch A Marketplace For Sneakers – TechCrunch
DISCUSSION QUESTIONS: Do the dynamics of stock trading make sense for the online resale of consumer products? Do you see the opportunity being limited to a few niche items or extending more broadly across many non-commodity items?