ThredUp Resale Report 2024 PDF

Resale Report 2024 Table of Contents Foreword The global secondhand apparel market continues to burgeon—a testament to Global & U.S. Market Sizing the intrinsic value shoppers find in the secondhand experience an...

Resale Report 2024 Table of Contents Foreword The global secondhand apparel market continues to burgeon—a testament to Global & U.S. Market Sizing the intrinsic value shoppers find in the secondhand experience and proof of the seismic shift towards a more circular fashion ecosystem. As we celebrate this Buying and Selling Trends progress, we also recognize the powerful role the government can play in accelerating the transition to a more sustainable future for fashion. Now in its 12th year, the Resale Report shows some of the most promising signals of what Life Cycle of a Thrifter that future could look like with increased levels of support. Until fashion is no longer one of the most damaging sectors of the global economy, we will Branded Resale continue to advocate for the government to help drive adoption and behavior change in fashion. We hope you enjoy this year’s findings and join us on our mission to inspire the world to think secondhand first. Government’s Role Glossary, Methodology & Sources – James Reinhart, ThredUp CEO Global Secondhand Apparel Market To Reach $350 Billion  by 2028, Growing 3X Faster Than Overall Global Apparel Market 2021 $141B Asia Europe 2022 $167B North America 2023 $197B South America Africa 2024 $230B Australasia 2025 $264B 2026 $295B 2027 $324B 2028 $350B $0 $50B $100B $150B $200B $250B $300B $350B Gross Merchandise Value In 2023 By 2025 Between 2023 and 2028 The global secondhand 10% of the global apparel The global secondhand apparel apparel market grew 18%. market is expected to be market is expected to grow at a CAGR made up of secondhand. of 12%. GlobalData 2024 Market Sizing and Growth Estimates U.S. Secondhand Apparel Market To Reach $73  Billion by 2028, Growing 11% Annually on Average RESALE 1 $80B SPOTLIGHT 29 U N STO P PA B L E m o m e n t u m 2 8 27 Resale grew 15X faster than the broader $60B Gross Merchandise Value retail clothing sector in 2023. 26 Resale will more than double by 2028, 24 growing 6.4X faster than the broader 44 retail clothing sector and representing a $40B 23 41 CAGR of 17%. 22 37 21 33 Resale is expected to more than double its market share over the next 10 years, 21 18 26 growing at a CAGR of 11% and gaining $20B 19 20 the largest volume of share of any distribution channel by 2033. 17 14 Resale will grow 6X faster than off-price 9 7 by 2033. $0 4 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 ONLINE RESALE IS DRIVING GROWTH Online resale saw accelerated growth in Non-Resale In 2023 Bet ween 2023 to 202 8 2023, growing at 23%—220 bps faster than in 2022. Gross Merchandise Value The U.S. secondhand apparel market Secondhand will grow at a CAGR of 11%. grew 11%—7X faster than the broader Online resale will account for half of all Resale retail clothing market. B Y 202 8 secondhand spend by 2025. Gross Merchandise Value New shoppers will account for 65% of incremental secondhand spend. Online resale will more than double in the next 5 years, growing at a CAGR of 17% to reach $40 billion in 2028. GlobalData 2024 Market Sizing and Growth Estimates Resilient Shoppers Turn to Secondhand Apparel Amid Economic Challenges S e c o n d h a n d m a k e s u p a s i g n i f i c a n t p o r t i o n o f s p e n d & c lo s e t s 2 52% of consumers shopped 2 in 5 apparel items bought in the On average, consumers spent nearly half secondhand apparel in 2023. last 12 months were secondhand. of their apparel budget on secondhand in the last 12 months. Compared to 65% of Gen Z and Millennials, up 5 pts from 2022. 23% 63% S h o p p e r s g r a v i tat e to w a r d s b u y i n g s e c o n d h a n d o n l i n e 2 13% Social media Peer-to-peer marketplace of consumers who bought secondhand apparel in 2023 made a purchase online, up 17 pts from 2022. Compared to 71% of Gen Z and Millennials 6% No preference 45% Channel breakdown for those who of Gen Z and Millennials prefer to buy secondhand prefer shopping apparel online, compared to 38% who prefer to secondhand online2 shop at a brick-and-mortar store. 20% Of those who prefer to buy secondhand Directly from a brand directly from a brand’s website: More than half say they trust brands more than marketplaces. 18% Livestream shopping 44% say they can more easily compare items side by side. 41% say they like to shop a more curated selection from a specific brand. 20% Managed marketplace Resale Thrives in a Value-Seeking Environment Where Consumers Are Shopping Deals value insights 2 Great brands at great prices, sustainably 2 2023: prioritizing price To p 4 R e a s o n s P e o p l e B u y S e c o n d h a n d Nearly 3 in 4 consumers say when it comes to apparel spend, value is king. 1 To get better deals of consumers say if they can’t find a good deal on an 59% apparel item, they won’t make a purchase at all. 60% of consumers say shopping secondhand apparel gives them the most bang for their buck. 2 0 2 4 : C O S T- C O N S C I O U S N E S S C O N T I N U E S 41% of consumers say when seeking a deal on apparel, secondhand is the first place On average, consumers plan to purchase 7% less they look. apparel at full price in 2024 than they did in 2023. Compared to 50% of Gen Z and Millennials of consumers say if the economy doesn’t 55% improve, they’ll spend a higher proportion of their apparel budget on secondhand. 2 To find unique items 3 To afford higher-end brands 4 It’s better for the planet Consumers Resell Apparel To Earn Extra Money and Clean Out Sustainably 25% of consumers resold apparel in 2023— nearly at parity with 2021 figures when post-pandemic activity was elevated. 2 Compared to 33% of Gen Z and Millennials Top 3 Reasons People resell Apparel 2 1 To make extra money Nearly half used the cash to pay for essentials like food and bills. Gen Z is most likely to put it into savings (41%). 2 To clean out their closet 3 To sustainably get rid of apparel Thrifting Transcends Generations, but Its Appeal and Purpose  Change Throughout a Shopper’s Life The Digitally Savvy The Eco-Conscious The In-Store The Experienced Individualist Family Planner Treasure Hunter Thrift Enthusiast Gen Z: Ages 18-26 Millennials: Ages 27-42 Gen X: Ages 43-58 Baby Boomers, Silent: Ages 59+ Median annual household income: Median annual household income: Median annual household income: Median annual household income: $52,460 5 $88,435 5 $101,500 5 $65,770 5 Children: 27% have at least 1 child Children: 57% have at least 1 child Children: 49% have at least 1 child Children: 93% are empty nesters with living at home; 89% of those have at living at home; 51% of those have at living at home; 54% of those have at no children living at home. least 1 child under the age of 5. least 1 child ages 6-18. least 1 child ages 13+. Shopping habits: 51% prefer to shop Shopping habits: 55% prefer to shop Shopping habits: 69% prefer to buy Shopping habits: 82% prefer to buy secondhand online vs. in a brick-and- secondhand online vs. in a brick-and- secondhand in a brick-and-mortar secondhand in a brick-and-mortar mortar store. Their #1 way to shop mortar store. Their #1 online store vs. online. 
 store vs. online. online is livestream shopping. destination is a managed marketplace. Why secondhand: They’re more likely Why secondhand: They’re more likely Why secondhand: They’re more likely Why secondhand: They’re more likely to buy secondhand to better express to buy secondhand to outfit their to buy secondhand to afford higher- to buy secondhand for the thrill of the personal style than any other family than any other generation. end brands than any other hunt and to get better deals than any generation. generation. other generation. GlobalData Consumer Resale Survey Branded Resale Saw Continued Momentum in 2023, With 31% Year-Over-Year Growth 74% of retail executives who don’t 200 currently offer resale are either +39 considering or planning on getting into resale in the future, 163 up 5 pts from 2022.3 brands 4 Number of Brands With Resale Shops 150 Brands who L AUNCHED 124 resale programs in 20234 100 50 36 9 4 5 0 2009-2018 2019 2020 2021 2022 2023 See which brands are having the biggest impact with scale in ThredUp’s Recommerce 100. Retailers Leverage Resale as a Gateway to New Shoppers 90% of retail executives say their customers are already participating in resale—an all-time high, up 4 pts from 2022.3 62% of retail executives say their customers care about their brand being sustainable. 3 47% of consumers say resale value is an important factor in purchasing apparel. 2 Compared to 60% of Gen Z and Millennials 38% of consumers say they shop secondhand to afford higher-end brands, up 11 pts from 2022. 2 27% of consumers have traded in apparel with a brand in exchange for shopping credit to that brand. 2 26% Top reasons CONSUMERS prefer shopping of consumers say they’re more likely to shop with a brand secondhand alongside new2 that offers secondhand apparel alongside new apparel. 2 Compared to 35% of Gen Z and Millennials 1 Wider variety 3 More likely the brand’s 5 More likely the 23% of price points products are durable brand cares about of consumers say they prefer to buy a secondhand item from a the environment brand before committing to purchasing new for the first time. 2 2 Wider selection 4 More likely the brand’s of products products are high-quality 22% of consumers say they’re more inclined to make a first-time purchase with a brand if they offer shopping credit for trading in used apparel. 2 Brands Generate Revenue Through Resale While Advancing Sustainability Goals Brands that offer resale Brands considering resale Brands not interested in resale Top benefits realized Top reasons brands T o p r e a s o n s b r a n d s since offering resale consider resale aren’t interested in resale 1 Advanced sustainability goals 1 To acquire more customers 1 Resale is too complex (87%, up 5 pts from 2022) (89%) (67%) 2 Generated more revenue
 2 To generate revenue
 2 They don't know where to start (80%, up 7 pts from 2022) (85%, up 7 pts from 2022) (56%) 3 Acquired more customers
 3 To advance sustainability goals
 3 They have higher priority initiatives (67%, up 22 pts from 2022) (77%, up 3 pts from 2022) demanding resources (56%) 67% 69% say resale will generate a meaningful say they're considering resale to Diluting the brand’s product or reputation (> 10% of total) revenue stream for the stay competitive with other brands has become less of a concern, down 10 pts company within 5 years. who offer it. from 2022. #1 brands say the biggest challenge with resale is getting enough inventory of pre-owned product. GlobalData Fashion Retailer Survey Best Brands in resale resale’s rising stars 1 Lululemon Athletica FROM #2 1 Aritzia 2 Patagonia FROM #6 2 SPANX 3 Vuori FROM #10 3 Outdoor Voices 4 Reformation FROM #7 4 Rag & Bone 5 Free People 5 Liverpool Los Angeles 6 Zara FROM #4 6 Mango 7 Johnny Was FROM #16 7 Show Me Your Mumu 8 Sézane NEW 8 Vans 9 Anthropologie FROM #12 9 J. McLaughlin 10 SKIMS NEW 10 Nic + Zoe 11 Dr. Martens NEW 11 Vineyard Vines 12 Abercrombie & Fitch FROM #13 12 Coach 13 The North Face FROM #18 13 PrAna 14 Everlane FROM #9 14 Kut from the Kloth 15 Converse NEW 15 TOMS 16 Quince NEW 16 Alice + Olivia About these lists:
 17 Tory Burch FROM #20 17 Paige Evaluating more than 55,000 brands in its marketplace, ThredUp ranked Best Brands for Resale using an 18 Smartwool NEW 18 Tommy Bahama aggregate score based on sell-through and volume of sold items in its marketplace from January 1, 2023- 19 Mother NEW 19 Sam Edelman December 31, 2023 and ranked Resale’s Rising Stars using an aggregate score based on year-over-year 20 Pact NEW 20 Rebecca Taylor increases in sell-through rates and volume of listed items in its marketplace from January 1-December 31, 2023 v. January 1-December 31, 2022. Government Involvement Could Accelerate the Transition to a More Sustainable Future for Fashion VOTERS fav o r c a n d i d at e s TA N G I B L E WAY S FOR THE who support circularity Government TO TA K E ACT I O N 65% of retail executives and 43% of consumers say the government is not doing enough to lessen fashion’s 3,2 environmental impact. 42% of consumers believe the government should take legislative action to help help promote sustainable fashion. 2 Compared to 52% of Gen Z and Millennials 65% 44% of consumers say they view circular of consumers say sales tax on 52% 2 textile policy as a non-partisan issue. secondhand apparel should be eliminated. 2 58% of retail executives say they’d 50% of consumers and 59% of of retail executives say they’d adopt circular business models 40% of consumers say they’re more likely Gen Z and Millennials say they’d invest in sustainable business or like resale if there were to vote for a candidate that supports buy more secondhand apparel if materials innovation if they government-sponsored financial 2 3 3 sustainable fashion. 2 there were no sales tax. qualified for government grants. incentives for doing so. Learn how brands and retailers are advocating for circular fashion policy through the American Circular Textiles policy coalition. Glossary Donation & Thrift: A sector of the broader “secondhand” market that includes Resale: A sector of the broader “secondhand” market that includes more curated traditional options such as Goodwill, Salvation Army, and yard sales. These product assortments, often well merchandised and/or higher end. Examples include secondhand options are primarily, but not exclusively, offline. ThredUp and The RealReal as well as upscale offline players like Buffalo Exchange. These secondhand options are primarily, but not exclusively, online. Off-Price: A retailer that sells items at lower prices than those typically charged by retail businesses. Off-price stores typically purchase overstocked goods or make Secondhand: Consumption of all used apparel. Includes both the Resale sector and special purchases. Examples include TJ Maxx, Marshalls, Ross, Burlington Coat the Thrift & Donation sector. Factory. Secondhand Products: Consumption of all used apparel, footwear, accessories, Other: Sales of clothing from all other sources, including grocers and books, furniture, entertainment, and beauty. supermarkets, drug stores, duty-free, warehouse clubs, variety stores, other non- clothing specialists, and convenience stores. Sustainable Fashion: Apparel that has been produced, sold, and distributed in such a way as to minimize, as much as possible, any damaging social and environmental Mid-Priced Specialty: Specialist clothing retailers operating in the middle of the impact. To be classified as sustainable, a company must reduce negative impacts at market in terms of price. Not value but not premium or luxury. They tend to be multiple stages of the supply chain and of the product’s lifecycle. Examples include found in malls or traditional main street locations. Examples include Gap, Ann Reformation, Allbirds, Eileen Fisher, Patagonia. Taylor, J.Crew. Methodology About the Report: ThredUp’s annual Resale Report contains research and data from GlobalData, a third-party retail analytics firm. GlobalData’s assessment of the secondhand market is determined through consumer surveys, retailer tracking, official public data, data sharing, store observation, and secondary sources. These inputs are used by analysts to model and calculate market sizes, channel sizes, and market shares. Further, for the purpose of this report, GlobalData conducted a December 2023 survey of 3,654 American adults over 18, asking specific questions about their behaviors and preferences for secondhand. GlobalData also surveyed the top 50 U.S. fashion retailers and brands in December 2023 to gather their opinions on resale. In addition, ThredUp’s Resale Report also leverages data from the following sources: ThredUp’s Recommerce 100 and internal ThredUp customer and brand performance data. View all sources here. Disclosure: All third-party brand names and logos appearing in this report are trademarks or registered trademarks of their respective holders. Any such appearance does not imply any affiliation with or endorsement of ThredUp. Published: March 2024 Sources 1. GlobalData Market Sizing: GlobalData’s assessment of the secondhand market is determined through ongoing retailer tracking, official public data, data sharing, store observation, consumer surveys, and secondary sources. These inputs are used by analysts to model and calculate market sizes, channel sizes, and market shares. Market data analysis included in this report was done in January 2024. 2. GlobalData Consumer Resale Survey: The consumer data in this report is derived from a consumer survey of 3,654 U.S. adults. The survey asked them a number of questions about their attitudes towards apparel, secondhand products, and resale products. The sample was designed to be representative of age and income and was also geographically representative. Surveying was undertaken by GlobalData in December 2023. Note: Survey data only sampled U.S. women until 2020. 3. GlobalData Fashion Retailer Survey: 50 U.S. fashion (apparel, accessories, footwear) retailers were surveyed in January 2024 about their sustainability and circular fashion goals. 4. ThredUp’s Recommerce 100: The Recommerce 100 is a monthly, independent review of branded recommerce, ranking brands and retailers who have dedicated resale programs by how many secondhand items they have listed at time of publish. See a detailed methodology here. 5. United States Census Bureau: Income and Poverty in the United States: 2020
 G e t i n t o u c h ! Press: [email protected] Investor Relations: [email protected] Resale-as-a-Service: [email protected]