Generation Z is changing the world and this includes the retail game. Environmental activist, Greta Thunberg has been dominating news headlines and is a fine example of the conscious and vocal Gen Z individual. All over the world, young people are taking action to advocate for a brighter future. Research by Ernst and Young indicates that it is the younger generation, with their sense of self-consciousness and emphasis on their role in the world, that is driving retailers to take greater responsibility for an environmental impact.
Taking matters into their own hands, Gen Z actively seek out alternative options — through resale sites and apps — and perhaps, what seems to be the future of sustainable fashion. Unlike a newly manufactured outfit, clothes are not technically “new”. Garments are “preloved”, meaning it does not create waste nor does it encourage over-consumption. This goes to the heart of the issue of overproduction and waste of unsold stock in the fashion industry.
Some luxury retailers have chosen to address this issue. Farfetch launched “Second Life” which enables customers to give their designer bags a “second lease of life” in exchange for credit that can be used for future Farfetch purchases. Younger consumers may not have a lot of spending power for higher-end or luxury clothing, but re-sale is an affordable gateway, as designer items are at a fraction of their original retail price.
Nevertheless, materialism isn’t the core driver to the resale economy. The RealReal, an online and brick-and-mortar marketplace for authenticated luxury consignment, stated that according to their 2019 report, 82% percent of their customers cited sustainability as a “important reason” for shopping on their platform.
With the introduction of these new resale ventures, buying secondhand clothing became more aesthetically pleasing as opposed to good old Ebay’s interface. Depop, a Gen Z favourite app, has a layout akin to Instagram, with its endless scroll, following, commenting and liking mechanism. There are currently 13 million users on Depop, making it a potentially lucrative business venture for those that have an entrepreneurial bone for re-selling goods. Depop’s business model is so promising that tech investors raised $62 million in June 2019 to grow the company.
This encouraging trend is replicated with other names in the resale market. The RealReal went public on the Nasdaq stock market, ThredUp brought in $175 million, Poshmark has nearly $150 million in revenue with “narrow losses”. As of 2018, the secondhand economy is a $24 billion market and is projected to grow to nearly 1.5 times the size of fashion within the next 10 years, according to a ThredUp report. This is primarily due to the resale of more high-end used items. Think Chanel and Saint Laurent at Vestiaire Collective and, Adidas Yeezy and Retro Jordans at StockX. Vestiaire Collective boasts of an online fashion community consisting of more than 3.5 million shoppers while StockX puts an emphasis on being a live bid marketplace for sneaker resale.
Amid the business success of organization’s netflix show master Marie Kondo, ThredUp’s 2019 report showed that it saw an 80% in its clean-out kits (the bags of clothes people send in for resale). Environmentalism is the pillar of the resale sector but in the case of luxury items, authenticity is just as important. The RealReal and Vestiaire Collective both add value by having a team of experts to authenticate goods, in order to be a safe and reliable platform for consumers to sell and buy luxury items. For Poshmark, which mixes both low-end and high-end fashion items, authentication is complimentary for items priced $500 and above. Depop, which is heavily user-generated, leaves it up to consumers to gauge the authenticity of an item for themselves.
The fact that massive fast-fashion retailer Forever 21 has filed for bankruptcy signifies a great shift in the way consumers are thinking and spending. The mindset of’ buy and toss’ is not as common as it was once. Resale sits at the opposite end of the spectrum, enabling customers to be proactive in addressing the carbon footprint problem of fashion by reducing supply chain waste. All this, while consumers find unique fashion pieces to make a stylish statement about their values