Tuesday, January 31, 2023
HomeMarketGood News for Resellers: Rising Prices Have Shoppers Buying Secondhand Gifts.

Good News for Resellers: Rising Prices Have Shoppers Buying Secondhand Gifts.

The market for secondhand gifts is on the rise.

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Saul Loeb/AFP via Getty Images

Like many people, Elyse Lyons has spent the run-up to the holidays obsessing over what gifts to buy for her family and friends, and devoting hours of shopping to cross those items off her list. But while others might do their present hunting online or at the mall, the 27-year-old has been doing most of her shopping at local thrift stores. 

She says about three-quarters of her 2022 gifts were sourced at thrift stores, a strategy that both saved her “so much money” and meets her goal of a more sustainable holiday. What’s more, she doesn’t see a secondhand holiday as a sacrifice: “If you were sitting in on our Christmas morning, you might not know that all of it is from a thrift store.”

While Lyons is certainly a prime candidate for what she calls “Thriftmas”—she runs a budgeting website and business called The Savvy Sagittarius—this may be the year that secondhand gifting tiptoes into the mainstream. A recent PricewaterhouseCoopers holiday survey found that 37% of people were planning on including resale or upcycled items on their shopping lists. Younger shoppers appear to be driving the trend; roughly 42% of Gen Z and 53% of millennial respondents said they were likely to buy secondhand gifts this holiday season.

Shoppers like Lyons may be combing the racks at local brick and mortar stores, but the big e-commerce resale players are also going after the gifting market.
The RealReal
(ticker: REAL), for one, says orders with gift boxes are up 24% from the beginning of November to mid-December, compared with the same period last year. Gift card purchases are also up more than 20% in the same period. The RealReal, like
Poshmark
and
eBay
(EBAY), publishes a holiday report for sellers, noting which products are hot with gift givers this season. Resale marketplace
ThredUp
(TDUP) launched its first “upcycled holiday collection” this year, while Poshmark debuted “Secondhand Sunday”—its spin on Black Friday—the Sunday after Thanksgiving.

One big driver of the move toward resale: the economy. In a ThredUp survey, 58% of consumers said secondhand shopping was helping them manage costs in a time of inflation, while 25% said they would consider purchasing more secondhand apparel if prices remained elevated. 

Still, some companies insist the shift toward secondhand isn’t just about saving money—especially among the younger demographic.

“This is a generation that is very thrift-savvy, and focused on both individual style and environmental impact,” said Poshmark CMO Steven Tristan Young in an email to Barron’s. “Shopping secondhand allows them to find truly one-of-a-kind gifts that align with their values.”

“The deal seeker has been shopping thrift for gifts for years but it’s this younger, more trend-driven consumer that has discovered it the last couple of years,” said Matthew Kaness, CEO of GoodwillFinds, a newly launched e-commerce effort from a group of nonprofit Goodwill franchises.

Gifting is part of the resale momentum that has prompted ThredUp to project that the secondhand market could grow by as much as 127% by 2026, reaching $218 billion. Growth is particularly strong in luxury resale: In 2022, the secondhand luxury goods market grew to 43 billion euros (about $45.6 billion), up 28% from last year, estimates Federica Levato, senior partner and EMEA leader of fashion & luxury at Bain & Company.

Items from brands like Chanel, Louis Vuitton, and
Hermés
have been the most popular gifts on the RealReal this year, said Rati Sahi Levesque, the company’s co-CEO and president. At Poshmark, luxury goods, vintage items, books, home décor, and furniture are among the hottest gifting categories, says the company.

Still, “Thriftmas” remains in its early stages, analysts caution, noting that secondhand gifts still carry a stigma for some people who have yet to hop on the thrifting bandwagon. Claire Tassin, retail & e-commerce analyst at Morning Consult, notes that resale gifting doesn’t often lend itself to exchanges or returns, and can require a major time commitment for the shopper.

“It does take some more thought and effort,” Lyons, the budget-savvy thrifter, allows. “But I do think that’s kind of the fun part, too—you are shopping uniquely for that person, rather than the cookie-cutter thing that you get on Amazon.”

Write to Sabrina Escobar at sabrina.escobar@barrons.com

Credit: marketwatch.com

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