Despite The RealReal’s impressive financial performance and revenue peak, doubts regarding the authenticity of products sold on the platform have resurfaced. The company reported a significant increase in third-quarter revenues, reaching $80.5 million, with a 55% growth from the previous year. The gross merchandise volume also saw a 48% increase year over year, amounting to $252.8 million. Despite these positive numbers, The RealReal experienced a net loss of $25.3 million, attributing it to rising costs related to marketing and technological advancements.
CEO and founder Julie Wainwright expressed optimism about the company’s performance, emphasizing accelerated growth and operational efficiency. The RealReal reported a total revenue of $220.7 million year to date, showing a substantial increase from the previous year. Looking ahead, the company expects continued growth in the fourth quarter and full fiscal year 2019, with GMV projected to reach between $997 million to $1 billion.
However, The RealReal faced criticism when a CNBC report questioned the platform’s authentication process, suggesting that not all items are evaluated by expert authenticators. Instead, copywriters who are undertrained and facing strict quotas handle some products, leading to authentication concerns. This is not the first time the company has faced authenticity issues, with The Capitol Forum and Chanel also raising concerns about the platform’s standards.
While The RealReal has not directly addressed the accusations, it has been acknowledged that copywriters handle some items, with only high-risk products being assessed by expert authenticators. Despite the scrutiny over its authentication process, The RealReal continues to experience financial growth and revenue peak.
For more information on The RealReal and its authentication process, you can visit their official website here. Additionally, for further insights on luxury consignment platforms, you can check out this informative article here.
