Find out why recommerce is one of the retail trends
Among the many changes generated by the digital transformation, we can add one more: the increasing relevance of recommerce.
The concept behind the term is not new, since it basically refers to the sale and purchase of used products, which have been a part of our lives forever. Thrift stores, community markets, antique shops and bookstores have long been successful business formats.
However, what is at stake now is the fact that we are appealing to a consumer trend that aligns very well with the purpose of genZ. And, following your spending habits, it’s highly likely that those purchases will happen digitally.
This is exactly what we intend to emphasize because we understand that in this case we are facing opportunities to reposition brands.
In this sense, recommerce can be seen as an opportunity for companies to increase revenues, as they develop strategies that are more suitable for the needs of new generations.
Studies have shown that this movement starts in certain niches, but soon includes other segments of the audience. That is, despite the success of, for example, online second-hand stores, resale strategies tend to spread to other areas.
What are the motives of the used goods market?
An important aspect to understand this trend is that the configuration of outlets, whether physical or virtual, takes on very different dimensions than those found in the last decade.
This is the case with second-hand shops. Unlike what happened in the past, today these are places where the public can “find” exclusive pieces. And because of this, the owners will stand out more with their curatorial role.
And, let’s remind, for genZ, this kind of purchase is not only an opportunity to save money. The main thing is conscious consumption, the possibility of reducing consumption and/or the impact of purchases on the environment.
Still thinking about this new behavior, it is also important to analyze the seller’s posture when they decide to pass their pieces forward. The possibility of selling items, in this case, is seen as a way of making money to buy other items, but it is also about the idea of extending the shelf life of the product.
Which segments stand out in recommerce?
In addition to the fashion field, reverse electronic trading (another name used for recommerce) has emerged, under these same perspectives, for electronics.
And considering the new dynamics of this sale, the idea that it happens in an amateur way is a thing of the past.
After the increase in spending on these items, we saw very well structured stores that work with resale. Not forgetting, of course, marketplaces, such as Mercado Livre, OLX, Ebay and Enjoei itself, which have been working very well for some time to promote closer relationships between resellers and their audience.
Especially in the fashion segment, one of the most developed, it is worth looking at some important points:
- Far from the “old clothes” or “out of use” scenario, thrift stores now play an important role in the fashion retail scene, as they cater to the desires of new groups of consumers.
- In this segment, reselling saw accelerated growth (significantly above the “normal” retail average) and encouraged the adoption of new practices by major brands, which created bonuses for reselling their products with partner sites.
- this movement, which was already underway, was accelerated by the Covid-19 pandemic. While retail sales decreased in this period, resale grew. A reflection of this was the entry of new players into the market. And at events like NRF Retail’s Big Show, which discusses the future of retail, reselling has emerged as one of the trends in the industry.
- a report by ThredUp, the American retail giant, helps to understand the extent of the changes: in the last 12 months, 74% of consumers have bought or are ready to buy used clothes. 53% of consumers bought used clothing in the last 12 months, which is 22 points more than in 2020.
- 45% of Gen Z and Millennials say they are more likely to shop at a brand that offers used clothing in addition to new clothing. An increase of 11 points compared to 2020 was recorded.
- 70% of consumers say it’s easier to buy used than five years ago, thanks to the rise of technology and online marketplaces.
What is happening in Brazil?
As has happened in other countries, in Brazil second-hand stores are starting to be recognized for their “curation” and this happens in physical stores or online. As in other sectors, what ultimately prevails is the multi-channel behavior of the audience.
Sebrae data from 2019 shows that the sector has seen accelerated growth: from 2010 to 2015, the number of facilities increased by 210%.
If we look at what is happening in the United States, we can conclude that the pace of store growth in this segment has continued to accelerate, although we do not have updated data for the country.
In the luxury market, it is important to note that the guardianship of the owners of these facilities goes beyond the selection of the most attractive pieces. They also have a mission to guarantee the authenticity of brands.
The movement of this resale market is also fueled by another factor: the attachment to “vintage fashion”. If a person wants a piece that refers to other decades, nothing better than looking for an “original” outfit, right?
A good indicator that we are talking about a promising market are the investments of large international brands.
In 2020, Levi’s launched Secondhand in the United States, which resells used jeans. In Brazil, the brand entered into a partnership with Repassa. The conscious fashion startup is now one of the largest online second-hand stores in the country, and has been owned by Renner since last year.
It was the way in which the retail chain decided to participate in the resale of its pieces. The model was also adopted by other important brands, which confirms that this is one of those irreversible market trends.
As you can imagine, in the case of these thrift stores, we are no longer talking about reduced structures. They work with thousands of brands, and the teams are ready to curate and, of course, publish offers.
What makes resale different?
Turning to the strategies that can be adopted for stores that decide on recommerce, the first recommendation refers to the professionalization of business.
Since they serve a very demanding and well-informed audience, this sector requires structured e-commerce with the best solutions in terms of technology.
In this case, we mean both issues related to the usability of the platform, in order to offer the best shopping experience, and aspects related to delivery and communication.
Discovery, by the way, requires specific strategies, because, even more than in other sectors, it is important to value all the resources of social commerce.
It is through social networks, such as Instagram and Tik Tok, that disclosure will gain more importance, even due to the need to create a differentiated connection with the public.
As we said, the strength of these operations is curation, which requires a relationship of trust between the store and the potential customer.
Another important difference: creating a channel of interaction in favor of buying, as you will need to keep your inventory well stocked.
Still among the resale strategies, it is important to remember that they also include the ability for the company to resell its own products. In other words, in this case, the proposal is precisely to extend the life of your items.
When looking into the possibility of re-selling or reverse-selling, keep this question of purpose in mind: by investing in this path, your brand can be positioned in a different way, connecting with the idea of conscious consumption.
Finally, it is worth noting that recommerce is not something for the future, because the movement in this area has been intense in recent years.
According to data from a Google survey, in Brazil, one in two consumers in the fashion and beauty category declares that they intend to reduce their spending on clothing from newly launched collections and invest in buying or renting second-hand items.
Globally, the ThredUp study estimates that sales of used clothing and accessories will double to more than $82 billion by 2026, growing 16 times faster than the overall retail sector.