Opportunity
To see the full potential of Merchagogo, you must first understand the growth path of its sister company, Merchbar.
Merchbar launched several years ago, recognizing there was no single place that a music fan could go to find merchandise from a comprehensive selection of artists.
They’ve grown to become the leading dedicated online retailer of music merchandise, growing more than 300% over the past five years while selling more than 3.4 million units.
Merchbar quickly built a business model that’s difficult to replicate.
- Deepest selection of products covering 330,306 artists, likely the largest set in the world
- Widest distribution network with goods shopping from over 400 Merchbar partners
- Comprehensive selection of goods including vinyl (50%), t-shirts/hoodies (33%), and accessories (17%)
- Large fanbase with over seven million registered users
- Excellent fan and artist data including input from Spotify and Instagram
Merchbar gives fans the opportunity to create connections with their artists. There are now more than 100 million, an average of 14 connections per fan. Spotify customers can also link their accounts to Merchbar, sharing their top 200 artists as well as their top 50 tracks.
These connections allow Merchbar to create highly personalized shopping experiences focused on a fan’s favorite performers.
Along the way, the Merchbar team identified a key element of the merchandise market that presents another major opportunity.
Solution
It’s the one item you might find worn by supermodels, celebrities in Hollywood, and kids at your local high school.
Blend it all together and you have two markets for vintage - people who want to make a fashion statement and fans who value the merch as a sign of their connection to the music. Both groups are often willing to pay a significant amount to get it.
The problem? The vintage music merchandise market is scattered across resale shops, a few specialty stores, and small online vendors. There’s no comprehensive destination for goods – just as was the case with music merchandise before Merchbar hit the market.
That’s why the team behind Merchbar is now creating Merchagogo.
Through their network of international partners, Merchagogo has acquired a selection of nearly 1 million vintage items including from artists like Taylor Swift, Led Zeppelin, and many more. This range of goods will instantly make them a top vendor in the space.
Fans will have the opportunity to be both buyers and sellers adding depth to the marketplace.
The opportunities for growth in both the secondary and vintage music merchandise marketplaces are huge. In fact, global apparel resale is expected to grow by $153B over the next five years.
Once established in music, Merchagogo plans to extend the marketplace to all categories that fans wear and collect including TV, Film, Sports, Culture, and more.
Product
The alignment with sister company Merchbar gives Merchagogo a major jump start with three of the keys to e-commerce success - audience, inventory, and infrastructure.
The deep set of partnerships with major publishers will allow Merchagogo to take a unique step.
Perks
*Anyone who invests more than $1,000 will take part in a revenue sharing pool. The pool will consist of 2% of Marketplace fee revenue with investors eligible to receive payments until their initial investment is recouped. (For instance, a $10,000 investor will be eligible to stay in the pool until they recoup $10,000 through this program) The money will be allocated pro rata based on an investor’s percentage of the total amount invested through this offering. Payments will occur on an annual basis. Investors keep all their shares at all times, even if the entire initial investment is recouped.
Usability
There’s no more powerful feeling at a live concert than singing along with your favorite song. Now fans can keep that feeling going with merchandise featuring their favorite lyrics.
The official licensing is key here. This customization is made possible by unprecedented agreements with all the majors including Sony, Universal, and Warner as well as dozens of other music publishers.
These t-shirts, hats, hoodies, and other items will be printed on-demand, allowing fans to select precise lyrics, all at favorable economics for Merchagogo.
Leadership
Customers
By establishing the first comprehensive resale marketplace for music merchandise, Merchagogo is well-aligned with its audience. E-commerce surveys indicate the core music merchandise buyer, aged 18-34, prioritizes authenticity, exclusivity, and sustainability in how they choose to shop.
Authenticity: With officially licensed products as well as relationships with tour operators and music publishers, Merchbar separates itself from the unlicensed knockoffs often found on sites like Etsy or Redbubble.
Exclusivity: Inventory will include vinyl and merchandise unavailable anywhere else as well as customizable lyrics merchandise.
Sustainability: 78% of consumers are more likely to buy music merchandise if it is eco-friendly, matching the resale and re-use nature of featured products.