Categories: Payment Methods

COVID Creates A Seller’s Market In reCommerce

Whether it’s called “certified pre-owned” or just plain “used,” reCommerce has never been hotter. Online marketplaces are well-situated for a COVID-triggered digital shift, personified by millions of the newly unemployed who are desperately seeking lockdown diversions and elusive items.

The reCommerce marketplace OfferUp first made headlines back in 2015, when its easy mobile-first footing made it an instant (and serious) competitor to entrenched players like Craigslist, eBay and relative newcomer Facebook Marketplace. But as the 2020 pandemic emptied store shelves, shoppers began finding depleted inventories online, too.

People quickly figured it out, and the market for gently used items blew up overnight. OfferUp CEO Nick Huzar recently told PYMNTS, “What we saw was a huge influx of demand pretty quickly, because you can’t get things right now, the stores are closed down.”

Huzar noted that parents on lockdown with young children are among the marketplace’s best new customers at the moment, noting that searches for games and amusements on OfferUp skyrocketed in the first and second quarters.

“Searches for puzzles … are up 1,000 percent; above-ground swimming pool searches are up 450 percent; water table searches are up 300 percent, as are the searches for video games; and searches for swing sets are up 200 percent,” according to PYMNTS coverage.

With product shortages starting to feel chronic and businesses trying to restart and reinvent to avoid permanent closure, all manner of sellers – from autos to home furnishings – are looking at OfferUp. “A good example would be a local furniture store here in Seattle that has sold $2 million worth of furniture in two years on OfferUp,” Huzar told PYMNTS’ Karen Webster.

“Huzar has seen a host of the car dealerships on the platform make a similar move, making their inventory easily viewable on OfferUp to consumers who either can’t go to their local dealerships or who are merely wary about doing it,” the report noted.

Consumers aren’t the only ones showing a newfound interest in the marketplace. OfferUp announced in March a company statement that it had received $120 million in new funding, and had acquired rival app Letgo “…to create a combined U.S. marketplace with more than 20 million monthly active users…”

Scaling is clearly part of the company’s future plans, although Huzar holds fast to the view of OfferUp as a fundamentally local player. “OfferUp’s focus … is local retail channels: how can they unlock all that local inventory and get it into the hands of the local customer who wants it, but just doesn’t know how close they are to it at the moment,” PYMNTS reported. “It is why OfferUp added local shipping to its platform a little over a year ago – because it was yet another way to take friction out of local commerce.”

And while its C2C roots remain intact and central to the company’s vision, OfferUp is proving to be a viable option for serious merchants.

Huzar noted that “…if you look at Seattle or even L.A., for example, over 18 percent of the adult population in these markets is using OfferUp every single month now. I think merchants are saying, ‘Hey, you know, why not try it? All I’ll have to do is take a picture.’”

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New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.

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