Leading French sneakers resale site Wethenew targets European expansion
It is all going very quickly for David Benhaim and Michael Holzmann. In three years, their shared passion for sneakers has led them to turn what was initially a side project into a start-up that is beginning to play a leading role in its sector in their native France.
Sneakers enthusiasts Benhaim and Holzmann, both steeped in contemporary street culture since their early teenage years, first met at commerce school. Dreaming about US brands and a US career, they began trading with collectors across Europe, buying and selling limited edition sneakers by Nike, Adidas and Jordan. The duo developed a knack for unearthing rare, unworn models and, seeing the rise of players like Goat and StockX in this market niche in the USA, they decided to launch their own business in France.
“We knew this sector well. And we thought there was an opportunity to create a shopping experience that didn’t yet exist in France. The market’s distinguishing feature is that products are usually launched in select specialist stores that run out of stock very quickly. Fostering a secondary market of aficionados who meet up to trade and talk sneakers on Facebook groups. But often, it is a case of cash purchases, with no real chance of checking the products’ authenticity. Often resulting in disappointment. We wanted to democratise the experience, making it transparent and enabling more enthusiasts to access this market,” said Benhaim.
Their concept was simple: limited-edition sneakers were featured on Wethenew, offered for sale at a price calculated by the site’s founders. If customers wanted to buy a pair, they placed an order, and the partners then started searching for the model within their network. While they couldn’t dig up every single model sought, the success rate was almost 100%, sparking a quick rise in demand.
A service-oriented model
In 2018, Wethenew was established as a fully fledged marketplace. “We set up an Instagram account and worked with a freelance community manager,” said Benhaim, adding that “it was crystal-clear to us we had to convey passion and a community spirit. We weren't really ready to handle the growth we experienced, but we still managed to develop a purchasing strategy and to forge links with influencers. We needed to establish a reputation to eliminate the fear of scams. The strategy paid off, and by adopting a didactic tone, with plenty of descriptions and pics or videos of the models, we reached an audience going beyond sneakerheads and pure aficionados. That was our goal, and by the end of 2018 we had mothers buying shoes for their kids.”
The launch strategy enabled the start-up to carve a space for itself in the booming resale market, where US giants were growing an appetite for new territories, among them Europe. Meanwhile, Wethenew’s strategy to target a broad audience enabled the company to expand its reach and organisation, hiring marketing, IT and logistics staff, and of course a team focusing on product authentication, the crux of the matter for Wethenew.
The website’s growing success, with revenue figures gradually reaching the millions of euro, attracted the interest of investors. In October 2019, a pool of private investors from the digital tech and fashion sectors brought in fresh funds and industry expertise. This allowed Benhaim and Holzmann to expand their staff and, crucially, to exchange information in order to refine their strategies.
“Nowadays, our genuine point of difference is our value proposition. A site like StockX has a hardcore audience,” said Benhaim. “Customers have the ability to understand the prices quoted for each model, they are well aware of each brand's specificities. This works well for us. Our audience is looking for service, for example information on how a shoe size actually fits, the ability to return or exchange merchandise, and even staggered payments. We are proud to have top ratings for customers experience. Our driving force is operational excellence,” he added.
Launching Wethenew’s own-brand
A strategic choice that is bringing dividends. After grinding to a halt for a few days in March 2020, Wethenew tweaked its organisation and closed last year with a more than three-fold rise in revenue, now reaching the tens of millions according to the founders. And the site is set to thrive in 2021.
At the end of last year, Wethenew presented the first models of its own label at a pop-up store within the Galeries Lafayette's Champs-Elysées branch in Paris. The style is of course streetwear, with sweatshirts and t-shirts designed internally, while the label’s running has been entrusted to Sofiane Kihoul, founder of Defend Paris, who also worked for French rapper Booba’s label DCNTD.
In the next few days, Wethenew will launch its first major collaboration, a range of sweatshirts, t-shirts, sport bras and hoodies developed with Champion.
Rather than an additional range of products on the site, the label must become an extra asset for Wethenew in months to come. The company, with about 50 employees at its Paris headquarters, is planning to carry out a funding round in the near future.
“It will enable us to develop content and a media positioning in the street culture segment. We have a strong presence on Instagram, and we will extend our footprint on YouTube, Snapchat and Tiktok. This will boost our community. Additionally, we will need to make our operations more automated. We receive hundreds of orders per day, and we have to be able to handle thousands, even tens of thousands of them,” said Benhaim.
It currently takes Wethenew a dozen days to fulfil orders placed from France. Soon, the plan is to replicate the site’s service-oriented model across the whole of Europe. And maybe create a new French e-tail giant.
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