AI, tariffs, and social commerce are driving the $367 billion secondhand market, according to ThredUp’s 2025 Resale Report.
For decades, vintage Chanel jackets and perfectly worn-in Levi’s 501s were the domain of thrift store diggers and estate sale regulars. But today, the secondhand fashion market is anything but niche. Once a quiet alternative to traditional retail, resale has gone mainstream — now a sophisticated, tech-driven industry projected to reach $367 billion globally by 2029. In the United States alone, secondhand apparel is set to hit $74 billion within the next five years, growing at a pace five times faster than traditional retail.
And while price and sustainability remain key motivators, new forces — tariffs, artificial intelligence, and social commerce — are accelerating resale’s explosive growth. According to ThredUp’s newly released 2025 Resale Report, compiled by retail analytics firm GlobalData, the secondhand apparel sector surged 14 percent in 2024, its strongest annual increase since 2021. Online resale, in particular, saw a 23 percent jump — the fastest expansion in three years — and is on track to double by 2029, with a projected $40 billion valuation.
“Resale continues to outpace the broader retail sector, with online resale in particular driving the sector’s growth,” Neil Saunders, Managing Director of GlobalData, said in a statement. “Shoppers are prioritizing quality as resale value becomes an increasingly important factor in purchasing decisions, and retailers are evolving their secondhand offerings to meet consumer demand with new avenues like social commerce, further driving adoption and preference for secondhand.”
As inflation pushes shoppers toward affordability and younger generations embrace secondhand fashion as both a financial and stylistic choice, resale is no longer an alternative — it’s an expectation. According to ThredUp, one of the biggest forces shaping resale’s future is government policy. Trade disruptions and rising tariffs on imported goods have retailers scrambling for more stable supply chains. As a result, 44 percent of retail executives surveyed by ThredUp are actively reducing their reliance on imported apparel, while 54 percent now view resale as a reliable alternative in the face of global trade uncertainty.
Consumers are following suit. Fifty-nine percent say if tariffs make new clothing more expensive, they’ll opt for secondhand. That number jumps to 69 percent among Millennials, signaling a shift that extends beyond cost-cutting into a full-fledged generational preference.
Consumers are increasingly thinking secondhand first, says said James Reinhart, CEO of ThredUp. He says the retail industry is adopting “powerful new pathways” for resale. “From the integration of social commerce and innovative AI applications to the establishment of trade organizations and interfacing with government, it’s clear why resale is seeing accelerated growth and has such a promising growth trajectory.”
Social commerce and AI-powered resale
Scrolling Instagram, spotting a celebrity in vintage Prada, and purchasing a near-identical secondhand piece — all in under five minutes. That’s the power of social commerce, which has rapidly transformed resale into an interactive, influencer-driven experience. According to ThredUp’s report, 39 percent of Gen Z and Millennial shoppers have bought secondhand fashion through a social commerce platform in the past year, compared to 28 percent of all consumers. Even more telling, half of younger resale shoppers say they purchased secondhand apparel specifically to create content or share on social media.
Retailers are taking note. Seventy-six percent of executives now say social commerce will be critical in growing resale within their brands, and nearly half are actively exploring resale integrations on platforms like Instagram and TikTok. With Gen Z’s penchant for circular fashion, combined with the immediacy of social shopping, resale is no longer a waiting game — it’s a real-time marketplace.
One of resale’s longest-standing hurdles has been the unpredictability of secondhand shopping. Traditional thrifting requires patience, but the introduction of AI is eliminating that friction. Personalization, predictive search, and automated curation are making secondhand shopping as intuitive as buying new.
Forty-eight percent of consumers say AI-driven personalization makes secondhand shopping just as easy as purchasing new. Among younger shoppers, that number jumps to 59 percent. Meanwhile, 46 percent of shoppers now say that if they can find an item secondhand, they won’t buy it new — a mindset that is driving retailers to invest in AI-powered resale platforms. Already, 78 percent of major fashion retailers have made significant investments in AI, and 58 percent plan to introduce AI-driven resale tools within the next year.
For brands, this shift represents more than just technological innovation — it’s become a necessity. With 94 percent of retail executives reporting that their customers are already engaging in resale, and nearly half of younger consumers more likely to buy from a brand that offers trade-in incentives, resale isn’t just a trend, it’s the future of fashion.
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