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ThredUp: Secondhand market to double to $350B by 2027; most popular brands are …

The U.S. secondhand apparel market is projected to reach $70 billion by 2027.

The global market for used goods continues to grow, with Gen Z leading the charge.

The global secondhand market is expected to double and reach $350 billion by 2027, with the U.S. market reaching $70 billion, according to ThredUp’s 2023 Resale Report. In 2022, the global secondhand market reached $177 billion; the U.S. market hit $39 billion.

The 11th annual study, conducted by third-party analytics firm GlobalData, found that online resale is the fastest-growing sector of the U.S. secondhand market, expected to grow 21% annually on average over the next five years, reaching $38 billion by 2027.  (All stats are for the U.S. market unless otherwise noted.)

The report found that GenZ is helping to fuel the popularity of resale — two in five items in Gen Z's closet are secondhand. More than half of Gen Z are more likely to shop with a brand that offers secondhand alongside new, up six points from 2021. 

Eighty-two percent of Gen Z has considered the resale value of apparel before buying it, and 64% look for an item secondhand before buying it new.

“Secondhand continues to be one of the fastest-growing segments in apparel, and online resale in particular is seeing solid growth,” commented Neil Saunders, managing director, GlobalData. “What's particularly striking this year is new detail around how much younger generations are expected to account for future growth as their purchasing power increases.

Retailers Response

The report also revealed the increasingly important — and strategic —role resale plays in the retail marketplace, with more and more retailers offering branded resale programs.  Eighty-six percent of retail execs said their customers are already participating in resale, up eight points from 2021.

Fifty-eight percent of retail executives said offering resale options to customers is becoming table stakes, up six points from 2021.

 In addition, 82% of retailers who offer resale expect it to generate a positive ROI.  And 45% of retail executives who offer resale said they're satisfying investor demands around ESG, and more than one-third said if resale proved to be successful, they would cut production of new products.

“Traditional retailers … are really the ones driving the market forward, and we expect increased adoption in retail as secondhand becomes more of a lifestyle for consumers,” Saunders said.

Most Popular Brands

The top five most popular brands in resale, according to ThredUp, are Torrid, Lululemon, Madewell, Zara and Free People.

Rounding out the top 10: Patagonia, Reformation, Urban Outfitters, Everlane and Vuori.

Other highlights from the ThredUp report are below:

• Value is the top driver influencing resale purchasing decisions, followed by quality, selection and convenience. Trends ranked as the weakest spend motivator.

• Thirty-seven percent of consumers spent a higher proportion of their apparel budget on secondhand last year. Of those, 63% increased their spend in response to inflation.

• U.S. consumers bought 1.4 billion secondhand apparel items in 2022 that they normally would have bought new, up 40% from 2021.

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