By Emily Xiao
You’ve witnessed it firsthand--COVID-19, quarantine boredom, and mass digitization. Over the past year, people have stayed home with little to do, and companies have rapidly adapted their sales strategies in response. This means, of course, an increase in online shopping, much to the detriment of brick and mortar retail. And what’s more is that tech-savvy young consumers seem to dictate emerging shopping trends. Gen Z and millennials’ current fixation? Sustainability.
Calls for sustainability have been growing for a while now. It’s a slow-moving trend, but one which has become increasingly apparent in the past year. Young consumers’ interests in vintage, quality clothes, novel and practical thrifting, and the environment mean that secondhand shopping is becoming mainstream. At the intersection of the sustainable and digital worlds, consumers seek companies like ThredUp -- the online resale site where people can buy and sell secondhand clothing at a commission. In a successful IPO, ThredUp sold 12 million shares to raise $168 million. By the close of trading, shares had risen nearly 43%, from $14 to $20.
Platforms like ThredUp change the accessibility of the resale landscape for both buyers and sellers. With 2.4 million listings, over 35,000 brands, and an average price point of $17, ThredUp appeals not only to bargain buyers but also to more well-off consumers exercising budget and environmental conscientiousness, crossing all demographics. The platform is easy for sellers too -- they merely need to send their clothes in a bag and wait on the company to take care of logistics.
ThredUp’s superior automation allows this convenience. Internal software takes care of pricing, product photography, and determes seller payout. Automated distribution centers, algorithms to determine the demand for items, and extensive customer data on shopping patterns mean that ThredUp is able to reach its target market accurately and efficiently.
But how long can ThredUp sustain its wins? Brands like Patagonia and Levi’s are launching in-house resale efforts that pose competition. The move back to in-person shopping means that consumers post-pandemic may look towards traditional thrift and established discount retailers like TJ Maxx. Even so, ThredUp is likely here to stay. Lingering recession means ThredUp’s variety of quality brands at fair prices will continue to deliver value. After all, the resale industry is only in its infancy. The company’s annual report estimates the secondhand market to be worth $28 billion, expected to rise to $64 billion by just 2024. As consumers increasingly prioritize sustainability, ThredUp will continue to deliver accessibility through its backward logistics technologies better than anyone.