As the second-hand market becomes more popular, brands are starting to take notice. Indeed, it is the perfect example of circular and sustainable fashion since rather than being disposed of, products are resold and reused which extends their life and reduces the need for new products to be produced. Many brands are still unsure of how they can be active in this space, but there are a few things they can do.
The second-hand market today
The second-hand market is a thriving reality, with an annual growth rate of 39%. However, at the moment, much of the second-hand fashion market is managed by consumers themselves, who sell and buy items through social platforms (Facebook Marketplace), apps (Vinted), and specialised web sites (Vestiare Collective). The majority of brands take no active role in the second life of their products, although some of them have quickly understood the opportunity behind the second-hand market. For example, back in 2019 - before the pandemic caused online commerce to explode - Burberry and H&M launched reCommerce and rental projects.
As reported by the Resale Report 2022 by threadUP, the brands that resell their items increased by 275% between 2020 and 2021, but they are just a few: "we are still at the beginning of this trend”.
Why brands should be more active in the second-hand market
There are several reasons why brands may want to be more active in the second-hand market for their products:
To meet the demands of the consumer
People want to buy luxury items that elevate their wardrobe but without breaking the bank - they want quality at affordable prices. But there is more: many consumers today are interested in sustainability and want to make their contribution by both buying used garments, and selling their products as a means to fund new purchases. Why not give them what they want?
To protect brand image and reputation
Consumers search out discounted channels and both unwittingly as well as knowingly end up buying counterfeits as a more accessible way to wear the brand. Cultivating the second-hand market provides a more accessible and safer solution to both brand and consumer that can make a counterfeits a less appealing alternative, and ensure consumers experience the true quality of original brand products. The second-hand market however represents a massive opportunity for counterfeiters as a channel to convincingly dispose of fake goods. Brands must take care to remain in control of their brand in this market.
To increase engagement
Each time a product is sold as a second hand purchase, it is a consumer experience in which the brand was not present. These purchases represent an opportunity for the brand to still remain active in these moments, as we will discuss later in the article.
To be more sustainable
By encouraging the resale of second-hand products, brands can leverage their consumers to help to reduce the amount of waste produced each year.
- To increase revenue
Up until now brands have been concerned by the on off sale of new products. But by taking an active role in the resale of their products, brands create opportunities to monetise the same product many times and increase the lifetime revenue of a product.
- To improve market insights
The second hand market is where the new trends first take shape. It is the playground where the savants and opinion formers scout and gather garments to create new outfits and looks. Knowing which products are rising in popularity can provide brands with valuable insights to predict which products they should be bringing to market. Brands will benefit from insights to help them better create products that are timeless and evergreen.