- Gen Z and Millennials are planning to buy more secondhand clothing due to rising costs, which now puts secondhand items as one of the fastest-growing online activities.
- “In our report, we looked into how Gen Z is emerging as a sustainable generation, since climate change is at the top of their concerns. They are also more likely to choose homemade products and alternatives, while avoiding products that do not have recycled packaging.”
- Brands should be asking themselves if there are any segments they are overlooking for online shopping, such as eco-friendliness and price increase.
Inflation has been causing shoppers all across the world to cut back on their spending and budget wherever necessary. Because of the price increases, the U.S. secondhand retail market is booming and expected to double to $82 billion by 2026.
Younger Generations Favoring the Pre-Owned Market
More specifically, over a fifth of Gen Z and Millennials are planning to buy more secondhand clothing due to rising costs, which now puts secondhand items as one of the fastest-growing online activities among Gen Z, increasing by 12 percent globally since Q1 2021, according to data from GWI. Laura Connell, US Trends Manager at GWI, says that while other generations are also showing interest in secondhand merchandise, the fastest and most notable uptick is being seen with Gen Z.
“Just over a fifth of Baby Boomers are comfortable with buying pre-owned items rather than new ones, but over a quarter of Gen Z are comfortable with purchasing pre-owned merchandise,” Connell said. “In our report, we looked into how Gen Z is emerging as a sustainable generation, since climate change is at the top of their concerns. They are also more likely to choose homemade products and alternatives, while avoiding products that do not have recycled packaging.”
Online Retail Experiencing a Decline
While more consumers are turning to secondhand shopping, online retail is declining. According to GWI, 15 percent of shoppers say their ecommerce purchases have declined compared to a year ago, and a further 12 percent expect it to decline even more. Connell thinks that this trend has to do more with inflation — customers will go wherever the bargain is, and if that means they have to go in the store to receive the discount, then they will go to the physical storefront.
“When we think about online shopping versus brick-and-mortar, there are different levels of accessibility to consumers. Online shopping is still on the agenda based on our May survey, with 57 percent of consumers saying their online shopping behavior has remained the same, but the difference is what they think about between the cost of living and sustainability. Brands should be asking themselves if there are any segments they are overlooking for online shopping, such as eco-friendliness and price increases,” Connell said.
Continued Growth Into 2023
With inflation continuing to disrupt the industry, Connell thinks consumers are going to keep cost-cutting and pursuing secondhand merchandise well into next year. Both inflation and sustainability have a huge impact on the clothing pieces that shoppers buy, and the secondhand market checks off both of those boxes, while still allowing customers to add something new to their wardrobe.
“I think consumers will continue to look to reduce their environmental impact and buy pre-owned clothing. With prices continuing to increase, I urge retailers to tap into this resale idea, and even into the rental idea to match that rising consumer demand,” Connell said. “Both in the U.S. and the UK, those are key players in the space right now. Rent the Runway doubled their revenue and increased their subscriber base within the past year, so when you look at the cost of living and rising inflation, consumers have a lot more value on their minds now.”