Defying two decades of fast-fashion domination, recommerce was accelerating 21 times faster than traditional retail before the coronavirus hit. But what’s driving this passion for the pre-owned, and how is it being assimilated by the big brands?
Fast-fashion may have enjoyed a prolonged spell of success, but now the growing demand for sustainability combined with the added bonus of luxury is turning the tide.
Maybe it’s about guilt. According to USA Today, the average American throws away 70 pounds of clothing and other textiles every year – much of it destined for landfill. The truth is that not so long ago, mainstream retailers put little thought into the complete lifecycle of their goods. However, times and consumer attitudes are changing fast.
Recommerce in the fashion sector is not a new concept – some would say it’s just a new word for a very old idea – but the growing trend is undeniable. Originally associated mainly with thrift stores, resale has been elevated to a global phenomenon. It’s no longer viewed as a second-best option but a positive choice to purchase more sustainably while enjoying luxury items without the luxury price tag. Marketers call that a triple-win.
It can also satisfy a psychospiritual need to simplify our lives. Many joining the new trend were spurred on by Netflix’s streaming of videos featuring decluttering sage, Marie Kondo, who encouraged viewers to purge closets and downsize their belongings – only keeping what brought them joy.
Enlightened millennials may have ramped-up the desire for recommerce, but a growing number of high-end stores are seizing the opportunities it offers, encouraging trade-ins and donations, and dispensing detailed information on a product’s carbon footprint and lifespan.
Cowen Equity Research estimates that $200 billion worth of luxury goods are available for resale in the U.S. and retailers are taking note. In April 2019, Neiman Marcus purchased a minority stake in designer accessories site Fashionphile, dipping their immaculately polished toes into recommerce for the first time. Nordstrom followed in January 2020, introducing their ‘See You Tomorrow’ resale arm online and in-store.
Some manufacturers have created sub-brands, such as North Face’s ‘Renew’ and Patagonia’s ‘Worn Wear’, to ensure used apparel reaches the market via their approved outlets without compromising quality or brand values. Others have strengthened relationships with customers through aftercare programs. Filson’s ‘Whiskey & Wax’ events allow canvas jacket owners to re-wax their Tin Cloth while sipping craft distilled whiskey.
Established fashion brands like Forever 21, H&M, and Zara are less than comfortable with the recommerce concept, still fighting to stay relevant in a shifting retail landscape. Fast-fashion may have enjoyed a prolonged spell of success, but now the growing demand for sustainability combined with the added bonus of luxury is turning the tide.
Global designer heavyweights such as Louis Vuitton, Coach, Kate Spade, Michael Kors, Ferragamo and Prada are seeing increasing numbers of their products being resold. But not all brands are thrilled at the prospect. In 2018, Chanel Inc. sued recommerce retailer, The RealReal, for the reselling of counterfeit handbags that were marketed as genuine Chanel. While The RealReal has a ‘100% real’ guarantee, their company size and product volume make it difficult to deliver on this promise.
Despite such setbacks and the uncertainty created by the pandemic, the future of recommerce stores such as The RealReal, Poshmark and ThredUp remains promising with the market’s total annual sales projected to double, reaching over $51 billion by 2023.
Non-profit thrift stores haven’t left the scene. On the contrary, their popularity is growing rapidly too – bringing its own challenges. Insatiable resale devotees have virtually ransacked many outlets, severely depleting stock. To tackle this issue, 117-year-old Goodwill Industries has partnered with OfferUp to upgrade their online marketplace, expanding selection and improving accessibility.
There’s speculation that the pandemic may give further impetus to the recommerce movement. Straitened shoppers will seek out less costly clothing without sacrificing their desire for quality or their environmental ethics. From the retailers’ viewpoint, a resale model might provide a solution to supply-chain shortages and squeezed restocking budgets while allowing them to retain and encourage customer loyalty.
Could it be that recommerce will provide retail with a way to rebuild when the coronavirus eventually releases us from its debilitating grip? Making predictions in troubled times is always risky, but so far it looks like this revolution is set to make a lasting difference.
CDI World dba. CDI USA, Inc - A wholly owned subsidiary of CDI Holding PTE LTD63 Hillview Avenue #10-02B, Lam Soon Industrial Building, Singapore 669569
© CDI World 2023