COVID-19 has made 2020 a challenging year for retail — but the resale market appears to be immune to the overall downward trends, according to ThredUp.
A ThredUp report released today revealed that online secondhand market is expected to grow 69% between 2019 and 2021, gaining 27% in 2020. Meanwhile, the fashion re-commerce giant projects the overall retail sector will shrink 15% over that period. Worth an estimated $28 billion in 2019, the resale market is expected to hit $64 billion by 2024 as resale disruptors such as ThredUp, Depop and The RealReal continue to see growth.
Although traditional retailers were challenged by store closures this spring, online commerce has accelerated amid COVID-19 — with ThredUp recording a record-breaking number of new visitors in May. ThredUp also reported a 50% increase in closet clean-outs during the public health crisis, as well as a 6.5 times increase in the number of donation clean-out kits ordered in April compared with prior months. Further, shoppers cut back on discretionary spending during COVID-19 — and according to ThredUp, 80% of consumers are willing to explore secondhand shopping when money is tight.
Resale has also become a growing trend as consumers — particularly millennials and Gen Zers — become increasingly environmentally conscious. According to ThredUp, nine in 10 Gen Zers are open to buying used apparel, and about half of shoppers are planning to buy more sustainable fashion in the next five years. At the same time, consumers are becoming more wary of fast fashion, with resale expected to be nearly twice the size of fast fashion by 2029.
“The ‘normal’ of the past is not working for so many people in this country. It’s not working for our planet. It’s not working for our economy. We’ve got to work to find another way. We can do better,” said ThredUp co-founder and CEO James Reinhart.
As resale continues to rise, a growing number of traditional retailers have gotten in on the trend. Just last month, Walmart announced a partnership with ThredUp, adding about 750,000 pre-owned items from the re-commerce site onto its website. In April, Reebok and Abercrombie & Fitch joined forces with ThredUp, with shoppers able to trade in used threads for loyalty points at the former and credits at the latter. Meanwhile, the resale site teamed up with Gap Inc. in February, with shoppers able to exchange used apparel for credit at Gap, Banana Republic, Athleta and Janie and Jack. ThredUp also announced deals with two department stores, Macy’s and JCPenney, in 2019.
Similarly, resale platforms have also looked to expand their reach in the traditional brick-and-mortar channel. In October 2019, France-based re-commerce company Vestiaire Collective opened its first permanent boutique as a shop-in-shop in Selfridges’ London flagship. Further, Neiman Marcus took a minority stake in online consignment boutique Fashionphile in April 2019.