Recommerce expands beyond fashion

The resale market is on the rise, as the stigma attached diminishes and consumers search for a sustainable path.

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With roots in flea markets, bazaars, and garage sales, “recommerce” in apparel predates the pandemic and even the digital age – though it has, until recently, remained tucked away at the periphery. A new class of eco-conscious and cash-strapped consumers are quickly changing that, pushing aside the stigma associated with buying second-hand to make room for resale in the mainstream.

In Canada, research by the NPD Group shows that 20% of Canadians have already purchased a second-hand clothing product, a number that grows to 26% among 18-to-34-year-olds, says Tamara Szames, a retail industry advisor with NPD. “The stigma has been removed for this market, whereas traditionally it was over indexing on certain demographics and households.”

Consignment marketplaces like the RealReal, ThredUp and Vestiaire Collective helped popularize the trend in fashion. Peer-to-peer resale platform Depop, acquired by Etsy for $1.6 billion in July 2021, has amassed more than 26 million users (90% of whom are Gen Zers) and now reportedly ranks among the 10 most-visited sites among the cohort in the U.S.

The buzz has pushed established brands and retailers to enter the space. In 2020, Levi’s launched Secondhand, a buy-back and resale platform that enables customers to buy pre-owned jeans and denim jackets and to receive gift cards when exchanging used items in store. And in Canada in August 2021, H&M launched Rewear, a platform allowing consumers to buy and sell used garments between themselves, including products from other brands.

DD9 copyRetail expert Bruce Winder believes a few trends are driving growth in recommerce. The stigma of buying second-hand has diminished, particularly among younger shoppers, and inflation continues to outpace wage growth, pushing consumers towards options that stretch their money further, while also meeting their needs for greener goods, he says. (In an October survey by NPD, 39% of Canadians said environmental policies were among the biggest factors influencing their decision to purchase from a brand or retailer, a seven point increase from the year before.)

These factors have boosted recommerce in the fashion space the most, but they’re also relevant in other categories – from home and electronics to outdoor goods and appliances – which Winder and Szames believe are poised to also be disrupted by the trend.

Already, IKEA is investing in circularity with its buy-back program, and a report by recommerce platform Chairish found home furnishings to be the fastest-growing resale segment in 2020.

Meanwhile, Hudson’s Bay partnered with Canadian startup Rebelstork in September 2021 to offer overstock, open box and used baby gear to shoppers through its own website. According to Rebelstork, new parents can spend up to $14,000 on their babies every year – often on items that they quickly outgrow.

So for young consumers entering first-time parenthood and who care about their environmental footprint, Szames says the model “makes total sense.”