People Don't Care If Their Clothes Are New Anymore
The advent of the luxury resale market—or “re-commerce” or consignment or whatever you want to call it—has changed what secondhand means. In today’s economy, pre-owned goods are a booming business, and they’re on the cusp of even more explosive growth.
The resale industry hit a milestone when shares of the RealReal, a secondhand luxury retailer, started trading on Nasdaq after a blockbuster IPO. Priced at $20 a share, it jumped almost 50% in the first few minutes of trading after raising $300 million in the IPO.
According to a recent report from ThredUp itself, the $24 billion secondhand retail market is set to outpace fast fashion by 2028. And per CNBC, resale as a whole is projected to tick up to 45% of the entire retail market by 2023, more than doubling from its current 20%.
Are we over new clothes?
Experts have speculated that today’s discerning shoppers, particularly the internet-savvy millennial and Gen-Z variety, are interested in premium goods. What they’re not interested in—and probably can’t afford given they haven’t reached their spending potential and are under substantially more financial pressure than previous generations—is breaking the bank to buy them.
There are also sustainability and ethical concerns when it comes to buying clothes from the $2.5 trillion fast fashion industry. In addition to exploitative practices, the environmental impact is staggering: Not only is the industry causing an environmental "emergency" thanks to it being one of the largest global users of water, but much of the low-cost clothing produced is quickly discarded and ends up in waterways and landfills, where its synthetic compounds can take hundreds or thousands of years to biodegrade.
All this considered, it seems that the stigma previously associated with secondhand goods is less relevant. Not only are shoppers more interested in buying things that already exist within the fashion ecosystem, they also want to save money, especially if it’s on something that could be a lasting investment, like a collectible sneaker or Hermès accessory.
Overall the idea of “ownership”—clothes, cars, art–is not what it used to be. Adding to the argument is the advent of clothing rental services, seminal amongst them Rent the Runway, which today a new drop-off partnership with Nordstrom. According to the company, its most active subscribers wear rented clothes more than 120 days (over 30%) of the year.