the consumers behind fashion’s growing secondhand market
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The Consumers Behind Fashion’s Growing Secondhand Market
By Sarah Willersdorf, Felix Krüger, Raphael Estripeau, Maelle Gasc, and Charlotte Mardon
Increasingly, consumers are realizing that it is possible to shop affordably and sustainably for exclusive, high-quality, and on-trend items. A new fashion and luxury market is growing fast: secondhand apparel, footwear, and accessories represent $30 billion to $40 billion in value worldwide. And although the number of fashion purchases and the size of
closets have decreased during the pandemic, the share of preowned items in shoppers’ wardrobes will likely continue to rise in the coming years.
A recent BCG survey of 7,000 individuals from six countries—powered by data from Vestiaire Collective’s consumers—has uncovered deeper insights into the trend. It suggests that the global secondhand market will likely grow over the next five years by a compound annual growth rate (CAGR) of 15% to 20%. Developed markets may see even greater gains,
and some online resale players could potentially experience 100% year-on-year growth.
Although affordability, selection availability, and item uniqueness are key drivers of the secondhand market, consumers’ mounting environmental concerns also contribute to its growth. Today, 70% of preowned buyers “like the sustainable aspect” of secondhand consumption, compared with 62% in 2018. Shoppers hope to own fewer, though better items, to
reduce overconsumption, and to take better care of what’s in their closets; the presence of a thriving preowned market encourages all three goals.
We’ve looked beyond general preferences to identify six consumer segments representing the variation in participants’ engagement with the secondhand market, including their motivations, the frequency with which they buy or sell items, and their preferred marketplaces. To better understand the shoppers of today and tomorrow, brands should take stock of these segments and, just as important, recognize how secondhand consumers may evolve—from occasional shoppers of luxury items, for example, to full-fledged brand loyalists. In
the past year, nearly 50% of preowned shoppers tried a new brand. Clearly, preowned consumption is a key driver of customer acquisition.
There are many ways brands can capture value from the growing market. They stand to gain as much as their customers from the new circular economy, but reaping the full benefits requires understanding where the opportunities lie. Brands should explore such options as selling secondhand themselves, developing their own resale platforms, instituting buy-back programs (making it easy for customers to sell their items), and partnering with existing resale platforms to leverage outside expertise. According to the BCG-Vestiaire research, 62%
of consumers would buy more from fashion brands that partner with secondhand players.
The bottom line for brands is that the preowned market is here to stay. To fill their wardrobes in a sustainable way with unique, value-friendly items—consumers are shopping secondhand. They will continue to do so in the years ahead. For those brands that capitalize on this trend, the rewards are numerous.
Learn more about the growing secondhand market—and the wide-ranging motivations of its participants—in the slideshow below.
The Consumers Behind Fashion’s Growing Secondhand Market
BCG powered by Vestiaire Collective
The global apparel, footwear, and personal accessories resale market is already significant and is poised to grow
The apparel, footwear, and accessories resale market represents 2% of the broader fashion and luxury market
The global market has a potential CAGR of 15% to 20% over the next five years
Sources: Euromonitor; BCG analysis.Note: BCG analysis for market sizing took two approaches: evaluation of total market size and calibration through market shares; and evaluation of total population expenditure and decomposition in share ofwallet by channel type. CAGR = compound annual growth rate.
$30 billionto $40 billion
Global resale market
0%
100%
1%Overall F&L CAGR over the past five years
15%–20%CAGR of global resale market in the next five years
~100%CAGR of some online retail players in the next five years
17
5
+1
Consumers are increasingly filling their closets with secondhand items
Secondhand-market penetration is on the rise
Closet share of secondhand fashion could grow from 21% to 27%
% of population that had purchased a secondhand product in the past year
% of wardrobe composition by channel for secondhand customers
Sources: Altagamma research 2020 (left); BCG x VC Resale Survey, mid-May to mid-June 2020 (right). Note: Numbers are from developed markets. Because of rounding, not all figures sum to 100.
20192018
14 12
8
13 13
1311
21 17
2023 (forecasted)
Marketplaces
Secondhand
Online outlets
Outlets offlineOffline multibrand retail
Brand stores online
Online multibrand retail
Brand stores offline14 12
10 8
13 13
1311
21
24 25
27
17
2
4
Brand stores offline
115
3
2020
4
Subscription
Rental
Brand stores online
Trad
itio
nal
10 millionnew shoppers
Source: BCG x VC Resale Survey, mid-May to mid-June 2020.Note: Because of rounding, not all figures sum to 100.
Secondhand consumption is increasingly driven by sustainability and affordability
Strongly agree Slightly disagree Strongly disagree Slightly agree Neither agree nor disagree
34 39
49 46
3 1112
32018 2020
Offer/choiceI am able to find a large selection of items and brands
32 38
41 43
2018
20 5 4 2020
13
Trend anduniquenessI find unique pieces to enhance my style
26
29 34
33 36
7 5 4 21
2018 2020
EnvironmentalconsciousnessI like the sustainable aspect of purchasing secondhand items
5
27 32
45 45
2018
16 135 47 6
2020
Affordability/purchase powerI buy items I can’t afford at full price
% of respondents who identify the following reasons as drivers of their secondhand consumption
24% 22%15% 17% 15% 17%
28% 24%14% 16%
12%
25%
Source: BCG analysis.Note: Because of rounding, not all figures sum to 100.
The secondhand market comprises six very different consumer profiles
Secondhand trialists
<35 years old <35 years old <35 years old35+ years old 35+ years old 35+ years oldDemographic
Consumption
Needs Authentication and experience
Exclusivity and uniqueness
Uniqueness seekers Impulsive sophisticates Trendy millennials Sustainability adepts Amateur merchants
Lowest activity rate inthe secondhand market(mostly first-time users); high spending per occasion because of focus on high-value items
Active on resale platforms in both engagement (follows, likes) and buying, with intention to search for uniqueness
Convenient buyingprocess (impulsive), different brand options for brand loyalists
Active on resale platforms in engagement (follows, likes); buy very frequentlyin search of uniqueness;sell to buy more items,generally secondhand
Ability to follow new trends, social interaction
Very active in social interactions; sell to buy more items (both new and secondhand)
Sustainability and experience
Not very active in selling; do not buy frequently; have low spending per occasion but engage with many platforms
Convenient selling process
Buy very little secondhand but are quite active in selling on a limited number of platforms
BUYERS ONLY SELLERS ONLYBUYERS AND SELLERS
Segment share: By # of people | By secondhand spending By secondhand and firsthand spending
$
17% 17% 12% 13%2%
9%
Source: BCG analysis.
The secondhand market offers multiple opportunities for increased engagement
3
Secondhand trialists alreadycare about sustainability; they can start selling with the intention of becoming more sustainable
Secondhand trialists can start selling to buy more items (often secondhand) to become trendier
Uniqueness seekers canstart selling to buy more itemsand transition into the impulsive sophisticates segment
Amateur merchants can startto use earnings to buy more secondhand items
Entry point Possible transitions
1
2
4
Frequency of buying
Freq
uenc
y of
sel
ling
Secondhandtrialists
Uniquenessseekers
Amateurmerchants
Trendymillennials
Impulsivesophisticates
Sustainabilityadepts
$
32
1
4
Source: BCG x VC Resale Survey, mid-May to mid-June 2020.Note: Averages based on rounded figures.
The pandemic has accelerated consumer trends in sustainability, sales channels, and fashion consumptionResponses to the question: “Once things start to normalize, how do you plan to adapt your behavior toward fashion?”
82
70
59
55
55
62
45
72
47
33
Buy more from socially responsible companies
Reduce the number of items I own/buy
Consume less
Buy more from online secondhand platforms
Make fewer impulse purchases
Buy more online
Limit fashion expenses to save money because of uncertainty
Shift fashion expenses to more purpose-driven categories
83 82 82 80 89 79
71 64 69 58 89 68
62 57 57 47 80 53
54 48 51 49 70 57
50 44 55 51 67 63
64 65 68 63 72 40
44 44 48 46 45 44
72 65 72 68 84 72
47 38 43 44 54 53
33 27 28 30 42 38
% of respondents who rank the following behaviors first or second among planned changes
Sustainabilityhabits
Channelmix
Fashionconsumption
Secondhand trialists
Uniqueness seekers
Impulsive sophisticates
Trendy millennials
Sustainability adepts
Amateur merchants
Buy more quality items to keep for a long time
Adopt a more sustainable behavior
$
Secondhand trialists
Uniqueness seekers
Impulsive sophisticates
Trendy millennials
Sustainability adepts
Amateur merchants
% of respondents who rank the following behaviors first or second among planned changes
$
Source: BCG x VC Resale Survey, mid-May to mid-June 2020Note: Averages based on rounded figures.
A thriving secondhand market drives sustainable consumption
How do you plan to adapt your behavior from a sustainability perspective?85%
70% The Durability Boost
The Upscale Effect
60% The Circular Life Cycle
of preowned buyers participate to reduce overconsumption by trading up fast fashion to fewer, better-quality items
of fashion consumers are encouraged to take greater care of their items thanks to the existence of a liquid secondhand market
of preowned sellers would not have given a second life to their items without the existence of a second-hand market
65
54
68
10
59
66
Buy more secondhand items
Buy less overall
Increase use of fashion rental
Buy more sustainable brands
Buy more items locally
Sell more
68 61 62 52 87 59
59 49 48 46 69 54
70 73 76 68 82 42
11 7 8 10 15
75
9
6358 50 56 54
46 42 76 72 85 78
74Donate/recycle more 9266 7575 68 72
Source: BCG x VC Resale Survey, mid-May to mid-June 2020.148% of secondhand shoppers purchased a preowned item from a newly discovered brand in the past year.
Luxury brands benefit from a healthy secondhand market
62%
48%
31%
Sustainability
Customeracquisition
Customerloyalty
of secondhand shoppers purchased a brand that was new to them; nearly all would consider buying these brands again1
of secondhand sellers bought new high-end goods with the money they made selling preowned goods
• Consumers appreciate purpose-led organizations that care about sustainability• Brands can adopt a comprehensive sustainability approach and account for the full life cycles of products
• Consumers discover brands through secondhand shopping• A preowned market encourages consumers to purchase high-end brands
• Brands can reward sellers with buy-back programs and exclusive loyalty benefits• Sellers can shop for new items with the money they gain from selling old ones
of consumers would be more willing to buy from fashion brands that partner with secondhand players
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