In 2023, 39 brands including H&M, Kate Spade, and Carhartt unveiled resale programs which, while impressive, is far fewer than in 2022, when 72 brands jumped in, according to ThredUp’s The Recommerce 100, which documents and monitors retailers’ resale programs.
But executives we’ve bumped heads with said 2024 may be the year that resale grows more as a result of the brands expanding their existing resale programs than new brands entering the fray.
They had other predictions, too:
New and resale items will commingle
Gayle Tait, CEO at Trove, which partners with brands to launch their resale programs, recently visited the Boulevard Haussmann location of Galeries Lafayette, France’s upscale department store chain.
On the third floor, she discovered what the retailer calls its (Re)Store department, where it features secondhand items, which bump up against new clothing in your shopping basket, in the dressing room, and in the bag after you pay.
“It’s not like I shop secondhand or I shop new,” Tait told Retail Brew. “It’s that I’m actually able to shop both types of merchandise in a very coherent, very pleasant shopping experience.”
US department stores may not start selling used merchandise anytime soon, but Tait noted that in the US, some retailers already sell used alongside new, including REI and Patagonia.
Resale programs go “multimodel”
When it comes to resale programs, brands tend to pick a lane. In the “buyback” model, brands acquire resale items from consumers, who sell them back their used items, often with an option for either cash or a larger store credit.
Contrastly, peer-to-peer programs are more like eBay or Poshmark—with sellers posting items, processing transactions, and shipping—while the brand earns a commission.
But this year, more brands will row with both oars, taking what Emily Gittins, co-founder and CEO of Archive, calls a “multimodel” approach. They may have launched, say, with a peer-to-peer model, but will add a buyback element as well. It has the potential to boost both the brands’ rates of acquisition and profits, since both buyers and sellers have ever-shifting preferences, and as more options appeal more broadly.
“In 2024, brands will take an even more holistic approach and we’ll see more brands scale by adding on multiple different customer options,” Gittins said.
Furniture brands will jump in
It’s no wonder why items like furniture brands—whose wares you can’t even manage to get up the stairs yourself, never mind ship cheaply—have been slower to jump on the resale bandwagon.
Retail news that keeps industry pros in the know
Retail Brew delivers the latest retail industry news and insights surrounding marketing, DTC, and e-commerce to keep leaders and decision-makers up to date.
But Gittins said that will change this year, and that’s because she thinks the viability of furniture has been having a California king-sized proof of concept on Facebook Marketplace.
“I literally have bought all of my furniture on Facebook Marketplace and we always use Lugg,” said Gittins, referring to the popular app that connects bulky-item purchasers to “Luggers,” independent contractors with trucks (and sore backs).
Brands, of course, could partner with apps like Lugg or TaskRabbit to help facilitate transporting the items affordably.
“There’s enough services…where you can very easily get someone to come and pick something up or collect something,” Gittins said.
Footwear brands, too
While footwear brands including Allbirds, Brooks Running, Steve Madden, and Frye have introduced resale programs in recent years, The Recommerce 100 remains dominated by clothing brands. But Gittins said she “anticipates a lot more footwear brands getting in.”
No, there won’t be a huge demand for a pair of sneakers that someone just trained for a marathon in, but when a consumer has returned sneakers they haven’t used but whose box they threw away, or which have minor cosmetic damage, they often are sold as used, albeit described in their listings as “like new.”
And footwear brands are “uniquely positioned to have an even bigger resale market” because there’s a “flow of damaged returns,” Gittins said.
And that’s a scenario that goes beyond footwear, which cues up our final prediction…
Resale will help tackle the returns problem
Returns—retail executives’ biggest ulcer inducer—accounted for more than $816 billion in lost revenue in 2022, according to a survey from the National Retail Federation. And contributing to that loss is that many retailers throw away more than 25% of their returns.
So if that dress shirt has a little schmutz on it that’ll come out in the wash, or that cashmere sweater that you couldn’t afford otherwise has a tiny pull in it, many resale aficionados will regard them not as trash, but a score.
“Damaged returns have either ended up in landfill, been incinerated, or just sitting in warehouses for a long period of time, so resellers are a great alternative to all those,” Gittins said. “Resale sites will become the go-to solution for brands’ damaged returns problem.”