Circular Economy Circular Economy

Mercari:
Brands Would Do Well to Join the ‘Resale Revolution’

Younger consumers are pushing resale into mainstream retail; and it’s changing how brands, platforms and other services that support commerce support and strategize around it.

By Geoff Nudelman | Published 1 year ago | About a 4 minute read

Image: Anete Lusina

We’re experiencing a “resale revolution;” and it’s fundamentally changing the way many of us in the US shop, according to the 2023 Reuse Report by global ecommerce marketplace Mercari.

According to the report, the US secondhand market is expected to reach $325 billion by 2031. What’s even more striking are the ways in which resale is slowly but surely becoming an integral part of the broader retail landscape; according to the report, Mercari has had more than 50 million downloads and gets 350,000 new listings every day in the US alone.

“Well over half of people surveyed for the report said buying secondhand is a lifestyle choice; and there’s a definite bias to younger consumers,” Neil Saunders, managing director of GlobalData (which worked with Mercari to compile the report), told Sustainable Brands®.

From July 2022 - July 2023, the report notes almost 82 percent of US consumers purchased a secondhand item — 89 percent of millennials and 83 percent of Gen Z shopped resale. That shows the tilt towards resale is there with younger shoppers in ways that are erasing any prior, dated stigmas or stereotypes of buying used.

Falling right in line with the broader trend of climate-driven purchasing behaviors by younger consumers, the report stated that well above 20 percent of Millennial and Gen Z buyers placed “reducing environmental impact” as a factor in choosing to buy something secondhand. Those numbers also track on the opposite side — as younger consumers are also looking for more ways to extend the life of unused items through resale.

“We’ve seen a notable shift in the conversation around resale within the retail industry; and it’s clear that resale will play an important role in the wider industry’s move towards a more circular economy,” Visa chief sustainability officer Douglas Sabo told SB.

Embracing the powerful potential of resale

The shift is so notable that retail-adjacent players such as Visa are reshaping portions of their business as more shoppers turn to recommerce.

For Visa, this innovation comes in the form of initiatives such as its recently launched Recommerce Behavioral Insights Lab — which is facilitating several real-world experiments to better understand how to integrate circular practices into everyday retail.

According to Sabo, resale businesses are still working on that consumer connection — with only 23 percent of UK-based small businesses, for example, offering a resale option.

For a company such as eBay — arguably a resale pioneer long before it was ever a burgeoning trend — it requires a redefinition of what the platform could be for a new generation of buyers and sellers.

“Our platform has transformed into a hub for recommerce in many categories, driven by the sustainability-conscious preferences of younger generations like Gen Z,” says Renee Morin, the company’s chief sustainability officer.

Despite the emergence of rival platforms such as Mercari, eBay remains a go-to, global marketplace for verified and authenticated goods through various self-run programs — especially with small appliances and electronics, which stand to have a greater positive environmental impact the longer they’re kept in service and out of the trash.

“Growth in eBay Refurbished GMV (gross merchandise volume) accelerated during Q1 2023, posting double-digit year-over-year growth with the addition of new categories — including computing and video game peripherals — as well as more brands and OEMs in existing categories,” Morin adds.

Apparel has the most potential and movement

One of the more interesting findings to come out of Mercari’s Reuse Report was the growth in male-identifying buyers exploring resale. 90 percent of male-identified consumers surveyed said they plan to purchase at least one secondhand item in the next year — and that’s supported by a 14.5 percent year-over-year growth in the “menswear” category on Mercari. Clearly, men’s-focused clothing is growing; and men are looking for more access to expensive items (sneakers, watches, etc) through verified resale channels. (GlobalData expects the “menswear” category to grow by 152 percent by 2031, according to the report. This is second only to “footwear,” which arguably could be partially incorporated into the “menswear” category, but remains separate for Mercari’s purposes.)

Over the last three years, apparel has easily been the largest growth category for recommerce — driven by streetwear, luxury and outdoor apparel brands alike looking to tap into new channels with current and new buyers. Whether by letting current customers buy and sell old pieces or offering a company’s own deadstock, flawed items or limited finds, apparel appears to be the most agile area for resale.

Recommerce is sure to continue evolving as consumers continue to explore it. Any entity with a stake in retail should adopt new messaging and offer more education to grow the segment, which is already making impact both in terms of the environment and the corporate bottom line: As Recurate asserted in its inaugural Resale Report, recommerce will be key for brands to unlock the next level of growth, engagement and consumer loyalty.

Geoff Nudelman

Geoff is a freelance journalist and copywriter focused on making the world a better place through compelling copy. He covers everything from apparel to travel while helping brands worldwide craft their messaging. In addition to Sustainable Brands, he's currently a contributor at Penta, AskMen.com, Field Mag and many others. You can check out more of his work at geoffnudelman.com.

Tags:

Visa