![\"\"](\"https:\/\/d3.harvard.edu\/platform-digit\/wp-content\/uploads\/sites\/2\/2022\/11\/StockX-Apple-App-Store.png\")
<\/a>VALUE CREATION<\/h2>\n\n\n\nStructure<\/h3>\n\n\n\n
StockX operates like a real-time trading platform by facilitating anonymous (i.e. avoiding disintermediation) trades and transactions between sellers and buyers: sellers list items with \u201casks\u201d (or \u201csell now\u201d), and buyers place \u201cbids\u201d (or \u201cbuy now\u201d). Transactions are deemed successful when a seller and buyer find a matching price. StockX has also dramatically simplified the resale e-commerce process by enabling sellers to post listings quickly and facilitating all processing, handling, and shipping with an escrow-like model. <\/p>\n\n\n\n
Transparency<\/h3>\n\n\n\n
All the \u201casks\u201d, \u201cbids\u201d and sales are displayed on each product page to foster transparent pricing. Buyers love this because they can better assess prices based on current demand, thus avoiding overpayment. In some circumstances, buyers can purchase lower-demand items below retail prices thanks to StockX\u2019s real-time market pricing, well-before retail outlets mark down inventory. Sellers also appreciate transparency because market price trends allow them to optimize sales to maximize profits. <\/p>\n\n\n\n
Authenticity <\/h3>\n\n\n\n
Upon a successful transaction, sellers ship their goods to StockX\u2019s facilities, where they implement a proprietary, multi-step authentication process (i.e. which involves human and AI-enhanced inspections) to verify each item\u2019s authenticity, quality, and condition. Counterfeiting was a significant pain point for buyers, and now StockX\u2019s \u201cVERIFIED\u201d tag has become synonymous with authenticity. <\/p>\n\n\n\n StockX makes revenue by charging processing and transaction fees. Processing fees are fixed at 3%, and transaction fees are tiered based on the seller level \u2013 i.e. the more one sells, the lower the transaction fee imposed on future orders. Higher-tiered sellers also receive additional benefits such as bulk shipping, early payouts, VIP account management, bonus discounts, and more advanced tools. <\/p>\n\n\n\n As of 2021, StockX was valued at ~$3.8 billion and considered profitable after generating $400 million in revenue from $1.8 billion in gross merchandising value (GMV) \u2013 a strong sign of growth after accruing $2.5 billion in cumulative GMV between 2016-2020. With targets on international expansion and growth, StockX has physical facilities in North America, Europe, and China, and ships to 200 countries. Unfortunately, StockX needs to physically handle, and authenticate each item every time it’s shipped and re-sold, which creates friction and incurs high operational costs. <\/p>\n\n\n\n In January 2022, StockX launched a non-fungible token (NFT) offering called the \u201cVault NFT collection\u201d, where each NFT is tied to a physical item that StockX sells, like how the numbers on a banking application represent actual money. <\/p>\n\n\n\n The launch represents a paradigm shift in the resale marketplace demonstrating how blockchain technology can effectively be used to improve operational efficiency and profitability. StockX claims the Vault NFTs will enable them to \u201creduce transaction fees, minimize environmental impacts, and create provenance.\u201d A reasonable percentage of resale buyers are also re-sellers themselves who intend on \u201cflipping\u201d items for profits as quickly as possible \u2013 a chain that continues until items reach their final buyers. By leveraging NFTs, StockX eliminates the need to handle and ship physical items multiple times, with digital representations being seamlessly traded repeatedly with ownership tracked securely using Ethereum. <\/p>\n\n\n\n Just a month after launch, Nike sued StockX for launching NFTs based on their shoes and trademarks. Nike claims that the NFTs are separate products and not merely digital traceable receipts since the shoes themselves stay in StockX inventory until someone claims them. This case has far-reaching ramifications for NFT \u201cfair use\u201d, trademark and IP policy, and how NFTs may be used to represent physical goods in marketplaces moving forward. <\/p>\n\n\n\n While Nike and others may be against StockX\u2019s foray into NFTs, some argue that this was a smart strategy for StockX to improve its profitability, scalability, and sustainability while maintaining its core value creation. But will it result in success or not? It will be interesting to observe how things unfold in 2022, and beyond. <\/p>\n\n\n\n https:\/\/ublawsportsforum.com\/2022\/02\/24\/nike-v-stockx-a-full-breakdown-of-the-nft-lawsuit-that-will-create-legal-precedent\/<\/a><\/p>\n\n\n\n https:\/\/www.cnbc.com\/2021\/04\/08\/sneaker-reseller-stockxs-valuation-jumps-to-3point8-billion-.html<\/a><\/p>\n\n\n\n https:\/\/www.insider.com\/guides\/style\/how-stockx-works-service-review<\/a><\/p>\n\n\n\n https:\/\/entrepreneur-360.com\/how-does-stockx-make-money-21767<\/a> <\/p>\n\n\n\n https:\/\/stockx.com\/help\/articles\/What-are-StockXs-fees-for-sellers<\/a><\/p>\n\n\n\n https:\/\/www.complex.com\/sneakers\/2016\/07\/stock-is-changing-the-sneaker-resell-market-and-detroit<\/a><\/p>\n\n\n\n https:\/\/www.theverge.com\/2022\/6\/6\/23156515\/nike-stockx-nfts-counterfeit-sneakers-lawsuit<\/a><\/p>\n\n\n\n https:\/\/www.theverge.com\/2022\/2\/10\/22925252\/nike-stockx-shoe-lawsuit-vault-nft-trademark-infringement<\/a><\/p>\n\n\n\n https:\/\/www.inputmag.com\/style\/stockx-vault-nfts-sneakers-shoes-nike-off-white-dunk-adidas-bad-bunny<\/a><\/p>\n\n\n\n https:\/\/www.highsnobiety.com\/p\/stockx-nft\/<\/a><\/p>\n\n\n\n https:\/\/www.aiobot.com\/stockx-nft\/<\/a><\/p>\n\n\n\n https:\/\/nftnow.com\/features\/the-nike-v-stockx-lawsuit-could-determine-what-type-of-nfts-can-be-created\/<\/a><\/p>\n\n\n\n https:\/\/nftnow.com\/features\/the-nike-v-stockx-lawsuit-could-determine-what-type-of-nfts-can-be-created\/<\/a><\/p>\n\n\n\n https:\/\/www.highsnobiety.com\/p\/stockx-nft\/<\/a><\/p>\n\n\n\n<\/a>VALUE CAPTURE<\/h2>\n\n\n\n
Payment Processing & Transaction Fees<\/h3>\n\n\n\n
<\/a>SCALABILITY & SUSTAINABILITY<\/h2>\n\n\n\n
Introducing NFTs to improve Scalability & Sustainability<\/h3>\n\n\n\n
<\/a><\/a><\/figure>\n<\/figure>\n\n\n\nBacklash from Nike – Trademark Infringement Lawsuit<\/h3>\n\n\n\n
<\/a>FUTURE OF STOCKX<\/h2>\n\n\n\n
APPENDIX: STOCKX BUSINESS MODEL IN DETAIL<\/h2>\n\n\n\n
<\/a>SOURCES<\/h2>\n\n\n\n