The second-hand fashion market is expected to be more than twice as large as fast fashion by 2030
The $ 36 billion second-hand market is expected to double to $ 77 billion in the next 5 years, according to ThredUp in its 2021 Resale Report. The Oakland, Calif In March and April 2021 3,500 American adults were surveyed that “the more consumers clean their closets, the easier it becomes to sell clothes online.” 36.2 million customers first sold used clothing online in 2020, joining a larger pool of 52.6 million people selling used clothing during the year. And based on those numbers, ThredUp says there is still plenty of room for growth. Another 118.8 million people say they have never resold clothes online but are “open to trying”.
With an estimated 9 billion pieces of clothing “barely worn or idle in consumer closets” in the US in 2020, online frugality became a “new pandemic habit” as consumers sold not just clothes online, but a sizable one Number – 33 million to be precise – first bought secondhand clothing online in 2020. ThredUp is hardly a COVID-specific trend, but ThredUp expects that the consumption of second-hand clothing will actually increase in the wake of the pandemic, as “first-time buyers plan” to increase their second-hand spending in the next 5 years “, resulting in a 4-fold increase in the next 5 years.
In addition to the increase in resale space, ThredUp points to the growth in second-hand consumption compared to fast fashion and notes that second-hand clothing has already grown faster than its fast fashion counterparts in terms of building market shares from 2020 onwards. “The market share of fast fashion is expected to remain roughly the same over the next 10 years” at around 9 percent, while the second-hand clothing segment is expected to grow to 18 percent by 2030, twice as much as fast fashion. Meanwhile, off-price retailers like Marshalls and TJ Maxx are expected to take 19 percent of the apparel market by 2030, and subscription apparel services, direct-to-consumer brands, and Amazon’s fashion division are also set to do the same Advance period.
Especially with regard to the shift from fast fashion to pre-owned fashion, a market that is expected to be twice as large as fast fashion by 2030, The ThredUp report shows that almost 2 out of 5 consumers who already buy used clothing state that they “replace fast fashion purchases with used clothing”. which may be supported by the fact that 1 in 4 say they “care less about wearing the latest trends than” [they did] before the pandemic ”and a whopping 1 in 2 says“ saving money on clothes is now a top priority ”.
As for the role of Gen Z consumers in the overarching growth of the resale segment, ThredUp claims that this younger generation simply has “more circular fashion habits” than older generations. Generation Z consumers, for example, are 165 percent more likely than their baby boomer counterparts to “check the resale value of clothes before they buy,” which luxury resale sites like The RealReal in the past associated with handbags and. have indicated other goods. They are 83 percent more likely to view ownership of clothing as “temporary” and are therefore subject to multiple changes of ownership to promote the larger sharing economy.
In one of its most striking observations, the reselling giant’s report states that for the next 5 years consumers will prefer second-hand clothing to new clothing that is marketed as “sustainable”. With that in mind, 42 percent of consumers say they plan to spend more on second-hand clothing versus 26 percent who plan to spend more on new “sustainable” goods and those marketed as “inclusive” and “transparent” will be 40 percent less than in 2019. This interesting shift probably reflects the cost difference between used clothing and “sustainable” goods, the latter of which tend to be considerably more expensive.
In addition, it is also likely a response to increasing consumer awareness of the widespread greenwashing that brands have been (and are) doing as a marketing gimmick. At the same time, the move away from “sustainable” marketing is almost certainly a result of the overuse of buzzwords like “sustainability”, which has created confusion among consumers about what such terms actually mean and whether such claims are in many cases valid.
The ThredUp report also highlights the “emerging growth channel” of reselling, especially given that 43 percent of consumers say they are more likely to buy from a brand where they can trade old clothes for branded credit, and 34 percent say they are more likely to buy from a brand where they can trade old clothes for branded credit that they are more likely to buy from a brand that offers second-hand clothing as well as new ones. The company notes that one in three retail managers says reselling is becoming an integral part of doing business in order to meet customer expectations, with 42 percent saying reselling “will be an important part of their business within 5 years.” This is reflected in the reasons brands are looking for the resale space, namely to attract more customers, attract younger customers and stay relevant, while of course increasing sales and doing business more sustainably.
With this in mind, ThredUp notes that brands “barely scratch the surface of the potential impact of resale,” with used clothing accounting for less than 1 percent of the total volume of clothing sold by retailers who have opened resale stores.
Finally, with regard to regulation, ThredUp found that policy incentives could encourage meaningful adoption of circular fashion, as 53 percent of fashion managers said they would “be more likely to test resale if there were financial incentives to do so,” and 47 percent of consumers said they “would be more inclined to buy used clothing if there was no sales tax or if they were given a tax credit”. As examples of how the government can “enable resale to get its environmental impact,” ThredUp suggests abolishing sales tax for consumers or providing a tax credit on second-hand purchases, providing tax deductions for brands with certified resale programs, and the Responsible disposal of clothing to consumers and encourages retailers to reuse returns
Neil Saunders, Managing Director of GlobalData, pondered these findings for a while, stating that “Retailers are seeing this change, which is why so many of them are now trying to get into reselling,” which makes reselling what it calls ” the most dynamic and dynamic “denotes a fast-moving part of the clothing market in the next ten years.”