Former RealReal Director Dumps On Re-Commerce, Gen Z, and Retail Trends

What started as a simple closet cleaning has grown into the realization of the untapped potential of the resale market. Retailers and re-commerce brands like The RealReal, Recurate and Vestiaire Collective have shaken up traditional distribution formats. This has continued to grow with the increased understanding of the impact of fast fashion on the planet.

“[Knowledge of resale value has] has led to the next big thing: people are changing what they buy in the primary retail market, focusing on the items they see have great value in the secondary market, ”says Karin Dillie Electricity retail.

The pandemic has changed a lot in the world as consumers and as businesses. From the immediate closure of stores in early 2020 to the accelerated growth of e-commerce, the world we live in is no longer black and white when it comes to retail. Omnichannel strategies are at the forefront and have become the priority for many companies as they adapt to an ever-changing landscape.

“In many ways, e-commerce has become less of a change than an accelerator and a bridge to brick and mortar,” says Dillie. “More importantly, resale has become a way to attract even more consumers into a brand’s ecosystem, both in the primary retail market (eg, the brand’s original store) and secondary. Additionally, since the pandemic, almost every fashion brand has been trying to find a way to provide consumers with an even better online experience (e.g. sound, touch, visuals). “

The resale market is estimated to be worth $ 5,000 billion, with major retailers gaining the attention of luxury brands like Gucci and Alexander McQueen. Online marketplaces like Etsy have since acquired Depop, a favorite among Gen Z shoppers. Will this success continue to grow even after the pandemic is over? Yes, definitely, ”Dillie tells us. “The resale market as a whole, both consignment and peer-to-peer resale, will continue to grow dramatically. Our team here at Recurate is bullish on recommerce in general and sees a ton of growth opportunities, especially among Gen Z consumers, across all resale channels.

Read more: Cya Millennials, it’s all about Gen Z

As previously mentioned by Electricity retail, the Next-Gen Shopper (Gen Z) is a digital native shopper who prefers brands that align with their ethics and values. Gen Z accounts for up to $ 150 billion in purchasing power worldwide, according to a report by WP Engine. In addition, they influence $ 600 billion in spending around the world. In 2020, Generation Z made up 40% of global consumers.

For Dillie, Gen Z is a progressive and adaptable generation who flourished in the wake of the pandemic, especially as oncoming consumers. “I love Gen Z! ”She tells us.“ This generation has progressed so quickly and the pandemic has only further fueled their passion for sustainability. I love that Gen Z consumers are using their voices. to demand what brands need to be. Brands need to listen to what this generation values, like clothes and accessories that have less of a footprint on the planet, are well made and rare. “

Photo by cottonbro from Pexels

So how should retailers view the Next-Gen customer? According to Dillie, companies should look at what people are already doing and respond accordingly. “For example, Generation Z is not afraid to buy clothes that have had a third or fourth life, ”she says. “They totally normalized circular fashion and went further. Additionally, Gen Z shoppers love experiences, stories, and want a deeper relationship with the brands they buy from. For example, Gen Z consumers would like to know the history of the backpack an influencer took with them on an epic backpacking trip before buying it secondhand.

As more retailers understand the market value of resale, big brands are jumping on the re-commerce bandwagon. This month, Amazon Australia entered the resale market with the introduction of Amazon Warehouse, and earlier in the year Poshmark landed in Down Under. As the resale market grows and expands further, could this hurt the entire category?

“There is a myth that resale cannibalizes the primary retail market,” she says. “In fact, what the numbers show is that reselling opens up a whole new sales channel for brands that they’ve never had before. Fifteen percent of the time, consumers buy both new and used items in the same transaction. Consumers are sold on the rise because brands offer both primary and secondary buying options.

“At Recurate, we are further developing the resale market and attracting more and more consumers to the brand. Just five years ago, people weren’t comfortable buying resale items, but now that they see their favorite e-commerce store selling resale items, they’re more likely to buy used items. We see that in the numbers, 50% of the used buyers of our brand are new to the brand. We’re accelerating this huge trillion dollar retail trend at Recurate, ”says Dillie.

So why is the resale market so popular right now? It’s all about sustainability. “Sustainability is a growing concern for consumers around the world, but access and affordability are still major factors that explain why the opportunity is so attractive, ”says Dillie. “A $ 400 dress from a brand can be unaffordable, but that same aftermarket dress could cost $ 200 and become much more accessible to the average consumer who wants to buy quality items.”

Photo by RODNAE Productions de Pexels

We have noticed many trends over the years on Power Retail, but one of the enduring trends in the industry is the importance of building trust with the consumer. No truer word could be said these days. “No one was encouraging anyone to sell on eBay five years ago,” says Dillie. “The responsibility rested with the customer. Now, brands are encouraging consumers to sell through their e-commerce stores. More brands participating in resale will attract new customers and create a much larger participation in clothing resale.

“We’re also seeing brands getting to know their customers and building more community around their brand. Previously, brands did not offer a secondary market. Resale is progressing despite the brands. Brands are now following this consumer behavior.

What will online retailing look like for Karin Dillie in the next 12 months? “Frankly, all brands and retailers seem to be switching platforms! ” she says. “Most brands and retailers have been significantly affected by the pandemic and are now considering how best to engage their customers. A major strategy that we see is for brands to actively invest in and grow their community – we’ve seen reselling become an important way to engage and grow this loyal brand community.

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