Back Market Hops On Second-Hand Phone Craze

06 Aug 2021 | 11.01 am

Back Market Hops On Second-Hand Phone Craze

Platform's catalogue spans over 200,000 devices

06 Aug 2021 | 11.01 am

Back Market is one of several online marketplaces for refurbished devices to recently launch in Ireland. Co-founder Vianney Vaute explains why to Darren O’Loughlin

One of the more successful examples of the circular economy is the market for second-hand, refurbished electronic devices. Investors are flocking to fund new players, who in turn are expanding globally. In the past year, three major marketplaces for refurbished goods have launched in Ireland: Swappie, Refurbed and, most recently, Back Market.

Back Market launched in Ireland in May, shortly after closing a €276m Series D funding round. Founded in France in 2014, Back Market operates in 13 countries, primarily in Europe but also in the US and Japan, and employs c.500 people. The business model is similar to German peer Refurbed, in that Back Market doesn’t refurbish the phones, laptops and other devices itself. Instead it operates a vetted marketplace for vendors, supplemented with after-sales services.

Vianney Vaute, chief creative officer, notes that Covid has accelerated uptake of cheaper, second-hand devices. “Not everyone can afford tech devices at their full price,” says Vaute. “The pandemic meant that people need tablets, computers and phones for education, work and entertainment, and they turned more to refurbished options.”

Back Market hosts over 1,500 vendors of refurbished devices, most of them French. The company assesses the credibility of prospective vendors by looking at the quality of their products, collecting feedback from their customers, and by anonymously buying and examining the devices. On average, one-third of Back Market vendor applicants are approved. Vendors pay €50 per month for their Back Market account and 10% commission on platform transactions.

The Back Market catalogue currently spans over 200,000 smartphones, computers and laptops, tablets, game consoles, audio devices, cameras, TVs, small appliances and wearables. Products are sold with a 12-month warranty and their quality is ranked from the lowest (‘Stallone’) to the highest (‘Mint’). The site says that the overall defective rate of products sold on the platform is 5%.

Back Market’s team seems large given that, unlike Swappie, the company does not refurbish devices itself. Vaute explains that the staff work primarily in engineering, marketing and supply management. “We don’t consider Back Market to be just a distribution channel – we try to be a partner with our sellers,” he adds.

“We can assist vendors to improve their repair processes, and we can also manage their after-sales services and sourcing components. We have a team working in our innovation lab that also examines devices and sees how merchants do their repairs. We can then come up with recommendations on how they can improve.”

Research by Refurbed earlier this year showed that three-quarters of Irish consumers would buy a second-hand device to reduce their environmental impact. One in three survey respondents claimed to have purchased a refurbished device, while slightly more than half told Refurbed that they would buy one in the future.

Only a handful of Back Market vendors are in Ireland but Vianney is confident that more will sign up. “Once we open in a country we attract merchants who avail of the opportunity to sell beyond their local market,” he says. “Ireland is a big piece in our global strategy – we’re projecting device sales of €25m here by 2024. For us it’s an important market to crack.”

Back Market’s latest funding will be used to finance growth and provide enhanced services for vendors. “We’re going to keep on expanding internationally, with a focus on the German market, as well as the US and Asia in the long run. We are also creating a new repair service for our merchants that will see us handle the repairs for users if they are required during the warranty period.”

Photo (l-r): Back Market co-founders Quentin Le Brouster, Thibaud Hug de Larauze and Vianney Vaute  (pic: Julie Glassberg)

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