The RealReal Looks to Third-Party Ads as It Retools Resale Platform

Do you click on third-party ads? Whatever your answer may be, it’s a part of The RealReal’s 2023 reconfiguration strategy.

The resale platform is planning to intensify its third-party advertising. During the company’s second quarter earnings call on Tuesday (Aug. 8), John Koryl, The RealReal’s CEO, spoke of the company’s intention to bring in brands that align with the interests of The RealReal’s customer profiles, whether that be airlines or luxury labels.

But will these advertisements enhance or impede the customer’s experience?

Firsts Impressions Are Great, but Then People Get Bored
In 1994, when HotWired introduced banner ads, they achieved an average click-through rate of 78%. Fast forward to 2011, when Facebook incorporated banner ads into its platform, the company encountered an average click-through rate of 0.05%.

A parallel narrative unfolds within email marketing. As consumers encounter an increasing abundance of similar content and less originality, a decrease in engagement becomes evident. According to eMarketer, global email click-through rates fell from 14% in 2007 to 11.2% in 2009. These days it’s 2.3%.

What happened? According to Andrew Chen, a partner at Andreessen Horowitz, with the introduction of novel marketing channels, their effectiveness typically diminishes as time passes, leading to a decline in click-through rates.


Leave a Reply

Your email address will not be published. Required fields are marked *