Dive Brief:
- On average, U.S. consumers spent almost half of their 2023 clothing budget on secondhand items, according to the ThredUp 2024 Resale Report.
- The 12th annual study, conducted for ThredUp by retail analytics firm GlobalData, found that 60% of U.S. consumers “say shopping secondhand apparel gives them the most bang for their buck,” making savings the most popular reason to shop secondhand. Meanwhile, concerns about the environment ranked fourth in the study. Similarly, the report said earning extra cash is the top reason people resell clothes and a desire to “sustainably get rid of apparel” is the third most popular reason.
- The global secondhand market grew 18% to $197 billion in 2023, 15 times faster than retail, according to the report. Meanwhile, the U.S. secondhand market grew 11% to $43 billion in 2023, seven times faster than retail, according to the report.
Dive Insight:
ThredUp’s current projections are in line with the company’s 2022 report, which predicted the U.S. secondhand market would reach a $70 billion valuation by 2027. The new report now puts that figure at $69 billion. The report also predicts that online resale will more than double in the next five years, growing at a compound annual rate of 17% to reach $40 billion by 2028.
“The global secondhand apparel market continues to burgeon — a testament to the intrinsic value shoppers find in the secondhand experience and proof of the seismic shift towards a more circular fashion ecosystem,” James Reinhardt, CEO of ThredUp, said in a press release sent to Fashion Dive.
In-house resale is a trend to watch for brands as well. The report found that 39 brands launched resale programs in 2023, including H&M, J. Crew, American Eagle, Toms and Kate Spade. The total number of brands with resale programs is now 163, up from 5 in 2019, per the data.
Based on a survey of the top 50 fashion brands in the U.S., 74% of executives at brands that don’t have resale programs are considering or planning to create ones, according to the report.
Of the approximately 55,000 brands on ThredUp, the top five brands for resale in 2023 were Lululemon, Patagonia, Vuori, Reformation and Free People. Both Lululemon and Free People also made the top five in 2022. Zara, Johnny Was, Sézane, Anthropologie and Skims rounded out the top 10 in 2023.
“With more than half of all consumers shopping for secondhand apparel last year, it’s evident that resale is now firmly embedded in the fashion landscape,” Neil Saunders, managing director of GlobalData, said in a press release sent to Fashion Dive. The report also found that 55% of consumers said they plan to “spend more on secondhand apparel if the economy doesn’t improve.”
If 2023 was a good year for the secondhand market as a whole, it was also a strong one for ThredUp. Earlier this month, ThredUp reported Q4 revenue of $81.4 million, up 14% year-over-year, and full fiscal 2023 revenue of $322.0 million, up 12% from 2022. The company expects to see full fiscal year 2024 revenue in the range of $340 million to $350 million, per their March earnings report. Increasing consignment sales and expanding their resale-as-a-service business helped ThredUp narrow their losses in 2023.
