The growth of the online resale market was evident long before Covid-19 hit, fuelled by younger consumers turning their back on fast fashion for a more sustainable, affordable, and creative way to shop.
Since the pandemic, online resale sites and apps (also known as ‘recommerce’ sites) have seen a surge in usage and overall sales. This is in contrast to many other retailers – particularly those with brick-and-mortar stores – who are facing the sustained negative financial impact. According to Three Up’s ‘Resale Growth’ report, the online second-hand market is predicted to grow 69% between 2019 and 2021, while the broader retail sector is projected to shrink 15%.
Consumers looking for value amid economic uncertainty
There are two overarching factors as to why consumers tend to shop second-hand – ethical and financial. With many people tightening their belts due to the impact of Covid, it’s likely that the latter has contributed to the growth in resale this year, as consumers embrace more affordable clothing instead of buying brand new. As well as reducing spend for consumers, online resale apps like Depop also enable users to make money or earn an additional income.
— Alycia Elizabeth (@SimplyAlyciae) October 31, 2020
Store shutdowns are also likely to have played a part in the surge in second-hand shopping, too, with people unable or unwilling to shop from charity shop or thrift stores now looking for an online alternative.
Traffic and usage data from various resale sites confirms this trend. According to Thred Up, May 2020 was a record-breaking month for new visits to the Thred Up site (an ‘online thrift store’), with 2.2m hours spent by shoppers browsing the site – this marks a 31% increase on pre-Covid. Similarly, and in contrast to many retailers who have been forced to make extensive job cuts, Depop has announced plans to expand its UK workforce by almost a quarter to 320 employees by the end of this year, which comes on the back of demand doubling during lockdown.
Of course, saving money isn’t the only motivation, with wider concerns about the environment and mass-consumerism also urging people to buy and sell pre-owned goods. Piper Sandler’s ‘Taking Stock With Teens’ survey (conducted in the Spring) found that 46% of teenagers from upper-income households have purchased clothing second-hand, while 58% have sold their used clothing to others.
Growth for eBay further highlights the demand for second-hand across the board, meaning it is not just new or youth-focused sites that are seeing growth. According to the Guardian, sales of used goods increased 30% on eBay between March and June 2020.
Retailers look to resale opportunities
In response to the market’s growth, many traditional retailers are also looking to capitalise on resale. One recent example is Levi’s, which launched its very own ‘buy back’ site in October. Levi’s SecondHand allows consumers to turn in a pair of Levi’s in exchange for a gift card towards a future purchase, which the brand will then clean and sort for resale online. Speaking to Vogue, Levi’s chief marketing officer Jen Sey pointed out how the move is designed to appeal to the shopping habits of Generation Z. “They love the hunt, they love finding a really unique item, and it makes it even better that it’s a sustainable choice,” she says. “Buying a used pair of Levi’s saves approximately 80% of the CO2 emissions, and 1.5 pounds of waste, compared to buying a new pair. As we scale this, that will really start adding up.”
Levi’s tell the story of a life well-lived. They only improve with every rip and tear. So get out there and make them your own. It’s your turn to write the next chapter.
— Levi's SecondHand (@LevisSecondHand) October 18, 2020
The direct benefit of this type of partnership is increased sales, with retailers capitalising on the opportunity to reach and engage consumers looking for second-hand items. At the same time, it can also enable retailers to turn excess or unsold inventory into revenue – without appearing to dilute the value or reputation of a brand. With Covid-19 shutdowns resulting in large amounts of unsold stock, this could be a growing motivation for retailers launching resale ventures.
Flea markets and charity shops making the shift online
Lockdown measures have forced retail stores of all kinds to shut down, including those that do not typically have an ecommerce presence, such as charity shops, flea markets, vintage boutiques, and thrift stores.
Consequently, we have seen some invest in and expand to online channels in order to drive sales. Wunderman Thompson explains how vintage clothing show ‘A Current Affair’ transferred to Instagram Live earlier this year, enabling more than 200 vintage vendors to sell through social. Similarly, the Brimfield Antique Flea Market in Massachusetts turned to Facebook Live to replicate its offline events, with success resulting plans to continue using the channel even as and when in-person events can resume.
Charity shops are popular destinations for second-hand shoppers in the UK, with many charities also losing out of valuable funds due to closures. In order to help, ASOS Marketplace has recently launched five charity boutiques for Oxfam, Save the Children, British Red Cross, Cancer Research UK and Royal Trinity Hospice. ASOS will reportedly receive no commission from the sales, instead enabling each charity to benefit from ASOS’ online presence during the Covid-19 pandemic.
Oxfam is one charity that has experience with retail partnerships, having launched #SecondHandSeptember back in 2019. For its campaign this year, the charity partnered with eBay, Selfridges, and Vestiaire Collective in order to continue its mission to change the perception of second-hand shopping. By placing charity shop collections in the context of a luxury store or high-end website, Oxfam is hoping to encourage consumers to think of it in the same way as shopping in larger retail or department stores, with the added bonus of executing more sustainable and ethical buying habits.
It might be the last week of #SecondHandSeptember, but you’ll find unique #SecondHand fashion gems in the @OxfamOnlineShop every single day of the year! Enjoy 20% off when you spend £40 before 30 Sep with SAVE20 ???? https://t.co/f1IMr0mFJW pic.twitter.com/KwzkfZ5yjL
— Oxfam (@oxfamgb) September 28, 2020
With high street and city centre retailers facing continued uncertainty in the months ahead, we could see resale (or recommerce) emerge as a strong and viable channel for 2021.
Join us Dec 1-2 at Econsultancy Live: Riding the Ecommerce Wave, with speakers from Unilever, Farfetch and more.