The resale revolution: we’re seeing the rise of second-hand first hand

I was recently in the market for a new mobile phone. As I was considering my options, I couldn’t help but notice the advertisements pasted around London touting the environmental and financial perks of buying a refurbished phone. It got me thinking about changing attitudes towards resale and pre-loved more generally… today, is second-hand becoming sexy?

If you’ll pardon the pun, second-hand isn’t a new phenomenon. Vintage stores, antiques fairs, flea markets and charity shops have always been permanent fixtures of the sector. And just as mainstream retail moved online during the ecommerce boom, so did the second-hand market. Platforms like Vestiaire Collective and TheRealReal have been operating for well over a decade, providing peer-to-peer marketplaces and consignment services for luxury brands. Elsewhere, there’s Depop and Vinted for mass-market fashion; Etsy, Narchie and Vinterior for homeware; BackMarket and MusicMagpie for electronics, and Rebag for accessories.

But now, momentum is increasing, and mass market retailers are paying attention. Driven by the move towards more conscious purchasing, the resale segment is projected to more than double in size to $64bn by 2024. Attitudes are shifting rapidly, as customers factor sustainability into their buying decisions.

“One has to be people’s acknowledgment that we all need to shop more sustainably. Each time you choose vintage you’re making a positive impact on the environment and our future.” – Sandrine Zhang Ferron, Founder and CEO, Vinterior

I caught up with Sandrine Zhang Ferron, Founder and CEO at Vinterior, a platform for vintage furniture. “There are a couple of reasons why second-hand is increasing in popularity,” she told me. “One has to be people’s acknowledgment that we all need to shop more sustainably. Each time you choose vintage you’re making a positive impact on the environment and our future.

“With furniture, what’s even better is how much character vintage brings to a space. There’s no risk of walking into your friend’s home and seeing the same sofa, chair, or table when you shop vintage. You can make your home wonderfully different and feel very good about it.”

sofa and coffee table inside a living room.
Vinterior is an online platform for selling vintage furniture.

Across furniture, apparel, homeware and tech, more and more customers are opting to buy pre-loved. This is largely driven by younger consumers: according to online secondhand marketplace ThredUp, more than 40% of Gen Z have bought used clothing, shoes or accessories. So it’s no surprise that mainstream businesses are making a play. Over the course of this year, we’ve seen companies from IKEA to H&M enter the resale arena, aiming to capitalise on the growing demand for second-hand. There are a few different ways that retailers are getting involved.

The most common route for businesses is to partner with or invest in resale sites. H&M, for example, invested in Sellpy in 2015, and recently increased its stake in the business to 70%, announcing plans to expand the platform into more than twenty countries. Unlike other resale services, Sellpy collects a bag of unwanted clothes from a customer, sorts through them, sells the goods on its platform and then gives customers 40% of the proceeds. Similarly, in a commitment to the circular economy, M&S recently partnered with the kids clothing resale site Dotte, incentivising users to sell their pre-loved M&S clothes by offering a £5 voucher for every M&S item sold.

Woman and man posing for Sellpy ad campaign
Sellpy sells customers’ unwanted goods on its platform and gives customers 40% of the proceeds.

Other retailers have launched their own platforms. In 2021, URBN launched peer-to-peer resale site Nuuly Thrift, giving sellers the chance to convert their earnings into ‘Nuuly Cash’, which is worth 10% more at URBN-owned brands. Online fashion giant Boohoo has laid out similar plans, with founder Carol Kane announcing plans for a PrettyLittleThing resale platform in the UK. While sellers will be able to list clothes from any brand on the app, the platform will be differentiated from competitors through customer access to PLT’s product database, meaning any PLT-branded items do not have to be uploaded by the user.

Another route to entry is through brand-exclusive resale sites. Levi’s SecondHand allows customers to trade in their old jeans and denim jackets for vouchers, before cleaning, repairing, and listing them on its recommerce platform. While this is hardly surprising for a brand like Levi’s (according to industry magazine, Levi’s is the most-searched-for denim brand in vintage and secondhand markets), we’re now seeing mass-market retailers follow suit. Just last month, Joules announced plans for ‘Joules ReWear’, a resale and recommerce platform for pre-loved Joules clothes. Away from fashion, IKEA’s ‘As Is’ service allows customers to buy furniture that’s been ‘gently used’, either by previous customers or in the showroom.

Clearly, there is a real opportunity here, and real money to be made. In the past twelve months, Etsy has bought Depop for £1.6bn, and online second-hand marketplace ThredUp has raised $168m in an IPO at a $1.3bn valuation. What’s more, beyond tapping into a burgeoning market and encouraging sustainable practices, moving into resale could provide access to more customer data: which styles are customers reselling? Who is buying second-hand? How long does it take for an item to be bought and resold?

“Moving into resale could provide access to more customer data: which styles are customers reselling? Who is buying second-hand? How long does it take for an item to be bought and resold?”

There will certainly be challenges ahead. The model doesn’t bring immediate financial returns: ThredUp made a net loss of $63.2m in last year, and TheRealReal recently predicted that it won’t be profitable until 2024. Moreover, beyond luxury fashion and furniture, apparel brands must think carefully about producing products that last – especially if customers begin factoring resale value into first-time purchasing decisions.

Resale is just one piece of the puzzle when it comes to conscious consumption. The rental space is booming; luxury brands are embracing tailoring and repairs; and we’re seeing services like DFS’ ‘sofa rescue’ become increasingly common. In the second-hand arena, the biggest hurdle for retailers will be navigating the various business models and differentiating themselves from the pack. Building a truly user-friendly platform or stocking pre-loved products in store could provide a competitive edge.

In the end, I did get myself a refurbished phone. It works just as well as a new one, has saved me money and is good for the planet – what’s not to love?! If this is the next retail revolution, then sign me up. | @TheMBSGroup