Friday, December 9, 2022

Secondhand Fashion Sales Will More Than Double By 2026, ThredUp Reports

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Secondhand fashion is outpacing sales of fast fashion—and that’s a good thing for the planet, says leading resale platform ThredUp.

The secondhand fashion market will reach $82 billion by 2026 says the 2022 Resale Report from ThredUp—the popular secondhand platform’s tenth. That number is up $5 billion from its last, showing the category is surpassing expectations as consumers seek to support the circular economy and reduce their environmental impact.

“The last 10 years of resale were dominated by marketplaces, but brands and retailers are driving the next wave of secondhand,” James Reinhart, thredUP CEO & Co-Founder, said in a statement. “We’re still in the very beginning of this trend, but the acceleration of resale adoption is a positive signal with enormous benefits for the planet.”

The secondhand wave

The ThredUp report, conducted by retail analytics firm GlobalData, reveals secondhand fashion is quickly becoming a “global phenomenon” led predominantly by the U.S. According to the report’s findings, the secondhand market is expected to grow 127 percent by 2026—three times faster than the global apparel market. And resale platforms will grow 16 times faster than the sector at large. Sales in the U.S. will double, reaching $82 billion by 2026 after record growth last year at 32 percent.

Secondhand’s impact on the environment isn’t insignificant; in 2021, secondhand shopping displaced nearly one billion new clothing purchases. Nearly 66 percent of consumers said they believe personal consumption habits impact the environment and 41 percent said secondhand is their first stop when shopping for apparel. That practice is highest amongst Gen Z and millennial shoppers; 62 percent said they look for secondhand items first before purchasing new, and 46 percent said they also consider the resale value of an item before buying. But Gen X is also driving the demand, according to data from The RealReal.

thredup secondhand
Courtesy Ksenia Chernaya | Pexels

According to the report, online sales are growing faster than brick and mortar locations; they’re expected to grow nearly four times by 2026, and 50 percent of resale earnings will come from online platforms by 2024. Consumers say it’s easier than ever to shop secondhand, with 70 percent saying it’s easier than it was five years ago. That’s likely due to the rise in secondhand shopping platforms catering to every budget and style.

But the rise in brands may also play a role. The number of fashion brands that launched resale offerings increased 275 percent last year. They’re watching the trends; 78 percent say their customers are already participating in resale—a 16 percent increase over 2020, and 88 percent that offer resale say it’s driving revenue. “We are still in the very beginning of this trend, but the acceleration of resale adoption is a positive signal with enormous benefits for the planet,” Reinhart said in the report.

Another key driver is the recent inflation; 58 percent of consumers said secondhand helped them through inflation and 25 percent said they’d consider secondhand if inflation continues while 80 percent said they’re buying the same or more secondhand options compared with 49 percent of consumers buying the same or more items overall.

“Resale has emerged from the pandemic in an extremely strong position. More consumers are shopping secondhand, growth has accelerated, and the interest from traditional retailers has soared,” said Neil Saunders, Managing Director, GlobalData. “The economic outlook remains uncertain, but with inflation driving apparel prices higher and higher, more shoppers appear to be turning to secondhand to make their budgets stretch further. These things will ensure resale remains a disruptive part of the market and a force for good in helping people shop sustainably.”

Replacing fast fashion

The fast fashion industry has been feeling the pressure in recent years. Shein most recently announced a sustainable collection. And proposed legislation in New York and most recently to the U.S. Senate, would hold the fashion industry more accountable for environmental and labor practices.

vestiaire collective tradesy
Courtesy Tradesy

According to the report, 62 percent of consumers who shop fast fashion say the industry encourages impulse purchases, and 20 percent said they feel pressured to have the latest styles due in large part to social media.

These consumers are changing their shopping habits, though. According to the findings, 65 percent of consumers who shop fast fashion say they’re aiming to do more secondhand fashion shopping, and 64 percent who bought their first secondhand item within the last year say they want to quit fast fashion for good.

Reinhart says while there’s still much work to do, there’s no question that the market is shifting in the right direction.

“This year’s report proves that with the collective power of conscious consumers, resale marketplaces, and forward-thinking brands and retailers, we can pioneer a more sustainable future for the fashion industry.”

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