Getting RealReal With Michael Groffenberger



The two fastest-growing categories on The RealReal, the popular online retailer of secondhand designer fashion, are preowned fine jewelry and luxury watches. The categories sell so solidly on the site, which was founded in 2011 by tech industry veteran Julie Wainwright, that the company recently opened six brick-and-mortar “valuation offices” across the United States (the latest, in Washington, D.C., bowed in April). The offices—also located in San Francisco, Chicago, New York City, Los Angeles, and ­Dallas—facilitate face-to-face experiences between consignors and gemologists and watch and jewelry experts. Michael Groffenberger, managing director of luxury consignment offices for The RealReal, says the idea for the valuation centers arose when “we realized we can create a great market­place online, but we also needed to recognize that customers and consignors want to meet with an expert.” That’s because, ultimately, “jewelry is a very nuanced business.”

How did The RealReal ­initially build up its jewelry and watch ­business?
We realized, okay, we have a secret sauce that works really well for jewelry and watches, too. Then it was about investing in and hiring experts throughout the country. Around three years ago we started building that business, and we’ve hired dozens of gemologists and experts. We take it very seriously. The jewelry store is designed as an imposing edifice—it’s something legitimate. Our legitimacy is tied to the accuracy we can offer. Then it becomes about pricing in a way that’s comfortable and fair for both the consignor and the buyer.

How do you keep your prices so notably low?
All of our product comes ­directly from consignors—we have the advantage of directly connecting consignors with our 5 million customers. We take the middleman out of the process. We have a seller and a willing buyer for the vast majority of product we’re providing.

What’s the sweet spot for The ­RealReal when it comes to jewelry?
The sweet spot is around $1,000. But we’ve sold items worth up to $100,000. We once sold a pair of Graff earrings for $99,950 through our app.

How do you think the site has made clients out of so many jewelry and watch buyers?
For one thing, we take that product description very seriously—the description is our voice of authenticity online. It’s not “You can call these earrings Graff”; it’s “These are Graff earrings.” That distinction is important.

What considerations went into setting up the valuation offices?
People want to understand the pricing of their pieces and what goes into pricing. We were thinking, “All we need to do now is take the expertise we have as a business and get it closer to our consignors.” Also, jewelry is a very emotional thing. A lot of times it’s easier to part with a $3,000 coat than it is a $3,000 watch—there’s often more of an emotional bond there. So having an expert there can be very helpful.

Describe a typical visit at a valuation office.
Most of our consignors come in with jewelry and watches, and they sit down with an expert. We look at the authenticity of all items, and we do all the pricing in their presence. There’s no pressure to sell with us. We give people a document with what we value their piece at, and they can take that with them and shop it around. We would be thrilled if they could make more with someone else! Some people are surprised by how much we value things for. Someone once came in who had received an offer of $7,500 for a ring, and we told them it was worth $75,000.

How many employees do you have working in the valuation offices?
We will have 30 people by the end of 2017. We look to people who are scientists, who are academics; they’re not salespeople, they’re graduate gemologists and watch experts. Every piece we see in the offices is a new, fun investigation.

Jewelry: a Ballon Bleu de Cartier watch, a Mouawad diamond collar necklace, emerald and diamond drop earrings, and a yellow gold diamond and emerald cocktail ring (photos: Kate Warren)

(Portrait photography by Cody Pickens)

 


  • Lapidary Artist

    Refreshing to see scientist and academics being employed but the notion that putting something ‘online’ cuts out the middleman I still find odd, perhaps misleading.