If there was any stigma left about used clothing it may have been erased last week as Nordstrom put its high-end brand on what it calls “re-commerce.”
We like the handle. While “reselling” or “secondary market” are more likely to keep ownership of this burgeoning market, the reselling market is reinventing itself for 2020. The resale market, currently valued at about $7 billion, is expected to triple by 2023, according to a report prepared for fashion reseller thredUP by the research firm GlobalData. The company says 56 million women bought secondhand items in 2018, up from 44 million a year earlier.
Nordstrom is taking a multichannel approach. Called See You Tomorrow, its “re-commerce experience” will include an online marketplace and brick-and-mortar location housed in the Nordstrom New York City flagship store on 5th Avenue. The inventory at launch will include women’s apparel, shoes, handbags, men’s apparel, accessories, children’s wear, jewelry and watches.
Customers participate through a customer intake program in the Nordstrom New York City store in exchange for Nordstrom gift cards that can be spent at its signature brands as well as its owned brands HauteLook and Trunk Club. Nordstrom has not yet launched its online intake program where customers will have the ability to mail in merchandise.
Logistics are being handled by Yerdle. It also manages resale programs for Arc’teryx, Eileen Fisher, Patagonia, REI and Taylor Stitch. For See You Tomorrow, Yerdle will power all backend operations including cleaning and repairing of product, inventory processing and fulfillment, pricing and authentication.
Nordstrom joins other department stores in the resell market. Macy’s and JCPenney have partnered with online reseller thredUP to offer secondhand items in department stores across the country. Neiman Marcus is now in the business of “buying back” certain items from its consumers. Even the Kardashians are in “re-commerce” with the launch of Kardashian Kloset, where they offload Max Mara jumpsuits, Valentino handbags and other designer apparel.
Founded in 2009, thredUP has processed more than 100 million pieces of clothing in the past decade, according to its president, Anthony Marino. The site’s most loyal shoppers, he said, range from teenagers to 40-somethings. It is playing the sustainability card this year, with Fashion Footprint Calculator. The tool asks 12 questions, starting with how many items a user buys each year, whether they rent clothing and how much they return. It’s not limited to thredUP customers.
After answering the questions, the respondent’s fashion footprint is graded and compared to the average consumer, who emits 1,620 pounds of carbon emissions per year through fashion choices. The tool was created with environmental research firm Green Story Inc., an independent environmental research firm.
According to “The State of Consumer Spending: Gen Z Shoppers Demand Sustainable Retail” from FirstInsight, 62 percent of Generation Z survey participants prefer to buy from sustainable brands, on par with millennials. Fifty-four percent of Generation X and 44 percent of the silent generation said the same. However, only 39 percent of baby boomers agreed, uncovering a serious divide between older and younger generations.
More data on the market comes from sneaker and streetwear reseller StockX. It announced last week it surpassed $1 billion in gross merchandise value (GMV) in 2019 and grew global buyer and seller registrations by more than 100 percent. It also goes to great lengths to give its consumers inside intel as to what will sell successfully on the site. It says some 57.5 percent of StockX sales had a retail multiple of 1x to 2x , meaning that resale prices were between zero and 100 percent over retail. More than 27 percent of orders had retail multiples less than 1x, which means they sold for under retail.
Larger sizes don’t command high prices but rare sizes bring in higher premiums on average. Among men’s sneakers, size 16 and size 4.5 carry the highest average resale multiples, reselling for 1.86x retail and 1.83x retail, respectively. Among women’s sneakers, those two spots belong to size 10.5 (resale multiple: 1.62x) and size 11.5 (resale multiple: 1.61x). Men’s sneakers sell for higher resale values than women’s, too.
The company recently opened offices in Tokyo, New York City and Silicon Valley, and authentication centers in the Netherlands and Atlanta. StockX opened its first brick-and-mortar location in New York City and had pop-up drop-off locations in London, New York City, Los Angeles, Atlanta and Chicago. StockX also focused on international growth by expanding in France, Italy and Germany which reduced processing fees and delivery times for its European customers. It also added multiple payment methods including Apple Pay, Google Pay, Alipay and Venmo.
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