What is recommerce: Definition, benefits, examples
Recommerce is booming as sustainability and affordability become consumer priorities. Learn the benefits for brands and get tips for resale success.
In 2024, the recommerce trend is striking a chord with consumers. Whether they’re looking to save money or save the planet, more and more people are opting for “pre-loved” items—and not just clothes.
The sector is seeing a massive surge, and is projected to reach close to $276 billion by 2028 (a 4.4x faster growth rate than the overall retail market).
For retail and ecommerce leaders looking for ways to grow business, understanding the current state of the recommerce market—and the consumer motivations driving it—is crucial.
Recommerce: Factors driving the resale trend
Recommerce (or, reverse commerce) has seen exponential growth in recent years, and 2024 is no exception. OfferUp’s latest Recommerce Report revealed that 85% of shoppers now regularly buy and/or sell secondhand items with 27% of respondents doing so for the first time this year.
This trend can largely be attributed to two key factors driving consumer behavior. The first is economic uncertainty and rising prices due to inflation, which is prompting shoppers to tighten their budgets.
OfferUp’s report found that the top three reasons consumers shop second hand are all value-driven:
- 78% want to get a good deal
- 58% want to avoid higher prices due to inflation
- 34% want to maintain their desired lifestyle while working within budget constraints
And 84% of those who sell on recommerce platforms do it to earn extra income.
Whether buying or selling, consumers are extremely budget-conscious right now. Recommerce gives them a more affordable option for updating their wardrobe, embarking on hobbies and personal projects, or just grabbing everyday items for less.
The other top factor driving consumer behavior today is increasing environmental awareness and a desire for more sustainable consumption patterns. People – especially millennials and gen Z – are increasingly prioritizing sustainability when shopping.
Often, we view that through the lens of them opting for more eco-friendly products or brands. But it’s driving a surge in recommerce as well. Buying secondhand extends the life of items, keeping them out of landfills.
Indeed, eBay’s 2024 Recommerce Report found that 63% of global consumers (and 71% of those aged 25-34) say sustainability is important to them.
Thanks to these shifts in consumer priorities, 76% of shoppers believe that there’s less of a stigma around secondhand shopping than there used to be, according to OfferUp’s report. Forty-one percent even consider it to be a status symbol.
What resells? Diversifying beyond apparel
Fashion has traditionally been one of the most popular categories for recommerce, but it’s by no means the only one. As the recommerce trend grows, it’s encompassing a variety of items.
“The data also paints a picture of an increasingly diverse recommerce market, with 77% of transactions extending beyond apparel,” said Todd Dunlap, CEO of OfferUp.
The categories that make up the other 77% include:
- Electronics
- Furniture
- Home goods
- Home improvement
- Sporting goods
- Outdoor equipment
- Auto parts
And eBay reports that, while interest in apparel remains strong, “goods for collections and hobbies saw a healthy increase of interest, especially among Gen Z (10%) and Millennials (6%) YoY.”
So what resells best? Assuming condition and quality are good, any number of non-perishable categories can reap the benefits. Categories like fashion and electronics, where what’s popular is constantly being updated by season or upgrade, offer a unique opportunity to let people grab high-quality items that may be marked down once the latest and greatest is released.
Fashion recommerce: A better model for a more sustainable future
Explore a new cost-effective approach that streamlines fashion recommerce and boosts the circular economy.
Retailers jumping on the recommerce trend
For retail and e-commerce companies, the rise of recommerce presents both opportunities and challenges. Strategically, it offers a new revenue stream and a way to engage with environmentally conscious consumers. Retailers can integrate recommerce into their existing operations or partner with specialized third-party platforms to tap into this growing market.
Many high-profile brands have successfully integrated recommerce into their business models, including:
- For instance, Patagonia’s Worn Wear program allows customers to trade in their used gear for store credit, promoting sustainability and customer loyalty.
- Similarly, IKEA’s Buy Back & Resell service encourages customers to return used furniture for store credit. The items are then resold or recycled, aligning with the company’s commitment to a circular economy.
- Other retailers such as Madewell and J. Crew partner with recommerce specialists like ThredUp to sell secondhand clothing.
However, entering the recommerce market requires careful consideration of several factors. Ensuring product quality, managing logistics, and maintaining customer trust are key. Customers need to be confident that the used items aren’t worn out before they’ll hit the buy button.
Optimizing operations for secondhand success
Leveraging the right technology can make or break a recommerce experience. For most online retailers, though, it shouldn’t require a complete overhaul of your system. Just a few adjustments.
Certain business operations will need extra attention when handling pre-owned items, including:
- Quality control: Ensuring the quality and authenticity of pre-owned goods can be challenging. Businesses need robust systems for inspecting and certifying products to assure customers of their condition.
- Logistics and supply chain management: The logistics of handling returns, refurbishments, and resales require sophisticated supply chain solutions.
- Inventory management. Efficient inventory management and reverse logistics are essential for recommerce success.
For example, if you’re going to be storing pre-owned goods, you need to be sure your inventory management system and warehouse tools can differentiate between new and used items—as well as the different level of quality for secondhand goods.
As with everything, AI is driving advancements to enhance the recommerce experience. For example, eBay’s AI-powered features like “Shop the Look” simplify the process of finding and buying pre-owned items, delivering a more traditional e-commerce experience.
And blockchain technology is enabling businesses to provide transparency and traceability in their supply chain, going a long way to build trust with consumers.
The future of recommerce
As more businesses adopt sustainable practices and consumers continue to prioritize value and environmental impact, the recommerce market is poised for continued growth.
By integrating recommerce into their business models, retailers can drive growth, foster sustainability, and meet the demands of today’s discerning consumers.
