We Need to Rethink Fashion’s Current Growth Model

For the last half a century, the fashion industry has relied on a linear supply chain. With this model, growing profit through garment sales means brands must ramp up production. According to the Ellen MacArthur Foundation, clothing consumption doubled between 2000 and 2015, and wears per garment decreased by 40%

While fashion companies are trying to be more sustainable, they haven’t addressed the main issue: rampant growth in the production of new garments makes the current fashion model unsustainable.

To meet customer demand without increasing manufacturing, brands need to rethink their current growth model. Branded recommerce is the most brand-centric obvious solution. Brands that sell their products through resale programs can reduce new production and reintroduce pre-owned branded products into their supply. This shift benefits shoppers and brands as it allows growth in sales without an increase in carbon emissions. Simply put, brands should ask themselves- Why sell an item once when you can sell it multiple times?

Why Fashion Needs a New Growth Model

The impact the fashion industry has on the environment is huge. A 2019 report from the UNEP finds the fashion industry creates about 8-10% of global carbon emissions. A 2020 report from the Princeton Climate Initiative finds emissions attributed to the fashion industry are likely to increase by 50% if brands stick with the current growth model.  Fashion is expected to account for 20% of the 2040 CO2 budget. [McKinsey… need to find the source]

The solution to fashion’s sustainability issue lies in an overhaul of the entire growth model, which includes addressing overproduction and textile waste.

Textile Production Drinks Up Our Water Supply

According to the Ellen MacArthur Foundation, fashion textile production uses 93 billion cubic meters of water annually. The impact of this level of production is felt in the communities of dry regions where clothing is manufactured.

In addition to water consumption, 20% of global wastewater is caused by dyeing and finishing clothing. The harmful chemicals used in these processes tend to find their way into waterways. Due to the chemicals used in the process, the water supply often can’t be treated to become drinkable after it’s polluted.

If fashion brands stick to the current growth model, it would mean an ever-increasing need for textile manufacturing. This model is not sustainable as it simultaneously decreases the total amount of usable water while increasing the demand.

Fast Fashion Capitalizes on Novelty at the Expense of Quality

In the 1990s, fast fashion companies like Zara, H&M, and Forever 21 reshaped fashion seasons from four to 52-micro seasons. More fashion seasons required brands to design and manufacture new clothing lines faster, all while sacrificing quality for quantity.

Shoppers, ever driven by the dopamine rush of something affordable and novel, responded to this trend by buying more items of clothing, more frequently. Brands have continued to reinvest in low-quality, low-durability garments creating a vicious cycle of unsustainable supply and demand.

Brand Owned Resale Programs Is the Obvious Solution

While there may be no quick fixes, resale as a channel is an obvious solution for brands committed to meeting the climate change mitigation goals laid out in the 2015 Paris Accords.

Resale as a channel reintroduces pre-worn branded products into a brand’s supply chain.  By giving these pre-worn garments a new life, brands can continue to profit from their products over time. This more sustainable model allows for business growth without relying solely on an increase in production.

While retailers have expressed concerns that resale could cannibalize primary sales, new studies published disprove those fears. According to Women’s Wear Daily, 60% of shoppers have discovered a brand through secondhand shopping. The survey suggests that branded resale can introduce shoppers to a brand at a lower price point, which may then lead to primary sales.

The bottom line is, that resale as a channel pumps the brakes on shopper and shareholder demands for ever-increasing production while allowing a brand continued growth. Reducing production supports global efforts to reduce carbon emissions and water pollution. This creates an overall net positive from a corporate social responsibility perspective.

The future of customer closets looks more fluid as resale becomes a popular way to shop. The only roadblock for brands to create a circular shopping experience is architecture and logistics.

Companies such as Trove, have created end-to-end item intelligence technology that optimizes every step of the circular journey. Trove’s product transforms complex logistics into a joyful customer experience, adding to brand equity without increasing carbon emissions.

We believe creating a more inclusive, less wasteful business model is possible. Let us show you how we can help your brand enter a new era of conscious commerce. The seeds of a sustainable future must be planted today.

Why Branded Resale Should Be Your Growth Strategy

According to Global Data, brands with their own resale programs increased by 275% from 2020 to 2021. Brands like Arc’teryx and Eileen Fisher, early to adopt this strategy are seeing huge success with their branded resale programs. 

It’s hard to ignore a booming sales channel that offers both a positive impact on the planet and sustainable brand growth. 

At Trove, we’re committed to bringing sustainable solutions to the fashion industry. We understand the risks and objections executives might have when it comes to rolling out a branded resale shopping experience for their customers. Here we’ve outlined some of the statistics and case studies that prove branded resale is a strong play for brands committed to sustainability. 

Your Customers Are Already Shopping Secondhand

While much of the interest in resale has been driven by Generation Z’s concern for sustainability and affordability, research shows that shoppers across all generations are shifting to resale purchases.

According to research conducted by the Baker Retailing Center at the Wharton School of the University of Pennsylvania, shopping secondhand has surged by almost 30% across all generations in the last few years

It’s interesting to note that while shoppers have different options for shopping resale, such as peer-to-peer marketplaces and clothing swaps, 65% prefer brand-operated or third-party Recommerce. This preference clearly demonstrates an opportunity for fashion brands to capitalize on. 

First Insight x Wharton

The Stigma of Secondhand Has Shifted 

Sustainability has always been a large part of why shoppers purchase pre-owned items, but inflation and the pandemic accelerated the growth of the resale market.

With less disposable income, shoppers tightened their budgets during the pandemic and became more conscious of their spending. While some bought second-hand to save money, they also dipped into their own closets to find the clothing they could resell. And, as health restrictions shuttered stores, shoppers turned to digital shopping experiences to supply their fashion fix. 

The below chart illustrates a group of respondents from 2021. Across all generations, most have purchased secondhand online. 

First Insight x Wharton

These changes in habits, combined with an ongoing awareness of our environmental footprint, are inspiring more customers to buy and sell pre-owned apparel. Not only is there less of a stigma against buying used goods, but people are also proud to share their finds. 

Branded Recommerce Reduces Counterfeits

According to data from the OECD, fake products are a $4.5 trillion market, with fake luxury goods accounting for 60-70% of that. As more shoppers go online for their favorite brands, counterfeiters are seizing new opportunities to sell through third-party marketplaces and peer-to-peer platforms.

Recent publications raise concerns regarding the in-house authentication processes of resellers like The RealReal, eBay, and ThredUp. According to an investigation by The Capitol Forum in 2019, hourly workers with the title of “copywriter” were responsible for authenticating luxury brand items. The report further explains that copywriters were pressured to meet authentication quotes of 130-155 items a day or risk being fired. 

While counterfeit items have always been a challenge for the fashion industry, luxury brands suffer more when third-party resale platforms sell counterfeit products as authenticated branded apparel. 

This poses a threat to brand reputation and could result in a loss of revenue if enough low-quality counterfeits are introduced into the market as authenticated products. 

At Trove, we partner with brands to create a branded authentication process. This way, you and your customers can feel secure knowing the products purchased through your branded resale channel are genuine. 

Branded Resale Revitalizes Brick & Mortar Locations

Outdoor gear retailer, REI is a perfect example of how branded resale channels can work together to support brick-and-mortar locations. In 2018, the brand launched its online resale channel. Then in 2020, the brand launched its online trade-in program and also offered trade-in at select stores. Members were encouraged to trade in their gently used gear in exchange for an REI gift card. 

After implementing their resale strategy, REI reported their used gear revenue increased by 86% year over year and their total year-over-year sales growth by 36%. 

Today they’ve expanded resale trade-in to all their brick-and-mortar stores after seeing the impact branded resale as a channel has had on both online and in-store sales. 

By offering used goods in-store and incentives for in-store trade-ins, REI created an opportunity to connect with customers who may be new to the brand while also serving avid brand loyalists ready to trade in and upgrade their gear. 

Executives considering branded resale should be thinking about how their resale strategy can support both online and brick-and-mortar locations. Trove offers an end-to-end solution for branded resale. We power the technology, operations, and analytics to help you gain insights into shopper behavior online and in brick-and-mortar locations. 

Recommerce Supports Brand Growth, Even During Supply Chain Shortages

Brands require a steady inventory of products to generate sales and maintain market share. As the pandemic revealed, the supply chain can be disrupted at any time by a shortage of materials and equipment, shipping and transportation challenges, and labor shortages.

Customers who can’t purchase the products they want because of an interrupted supply chain often look for similar offerings from competitors. It takes only a few clicks to switch to another brand, and businesses risk losing the customer entirely when they’re satisfied with the competition and decide not to come back.

A resale channel can help a brand through supply chain shortages by providing another avenue for shoppers to find products, and generating continuing revenue to support operations. Resale as a channel also extends the customer lifecycle with a brand. 

Trove Makes Launching Your Branded Resale Channel Easy

Premium brands such as Lululemon, Levi’s, and Patagonia are among the many businesses taking ownership of their resale products by partnering with Trove. These brands continue to drive sales from the initial purchase of their products to capturing additional revenue from resales that might otherwise be lost to third-party sellers.

To learn more about tapping into this channel, schedule a demo with us today

Sneaker Brands Are Missing Out on a $10 Billion Industry

According to research conducted by Piper Sandler in 2021, the global sneaker resale market is worth $10 billion. Sneaker resale makes up nearly 25% of the global secondhand apparel market

Why Decision Makers Should Consider Branded Resale

  • Capture Sneaker Customer Data & Sales Analytics
  • Combat Counterfeit Product 
  • Build Community & Brand Loyalty

Capture Sneaker Customer Data & Sales Analytics

According to Gerald Flores, former editor-in-chief of Sole Collector, when brands own their own resale channel, “they’re able to capture more data points on what makes a hype sneaker.” Data like this can help brands understand how much product they should initially release or re-release. 

Re-releases of Yeezy’s collaboration with Adidas drove down the resale demand and price to a more reasonable level. By controlling their own branded resale channels, sneaker brands can have their finger on the pulse of resale trends without saturating the market. 

Combat Counterfeit Product

In 2018, Homeland Security Investigations seized $70 million worth of counterfeit Air Jordans from New York-based warehouses. Counterfeit sneakers are a huge problem within the sneaker resale marketplace. 

Many third-party resale platforms make promises that their products are authentic, but there are reports of fake products being sold on these platforms. For example, Nike has filed a lawsuit against StockX for selling fake sneakers, and The RealReal has sold a fake Dior shoe for over $1000.

While some customers discover they’ve purchased a fake product immediately, others may not. For those customers that remain in the dark, a poor quality knock-off could impact their perception of the brand, decreasing the overall brand reputation. Negative customer reviews, loss of sales, and loss of partnerships with distributors are all ways counterfeit products can impact a sneaker brand. 

Branded resale programs help shoppers feel secure that their purchase is authentic while introducing a new stream of revenue. 

Build Community & Brand Loyalty

For many customers, sneakers are more than just a type of footwear. They’re a way to define their identity and symbolize membership in an exclusive community. Sneakerheads are a unique group with their own customs and language. It’s important for brands to create a sense of community when interacting with these customers.

Participating in sneaker resale gives brands more opportunities to create a community in retail locations. Breathe life into retail spaces that have lost foot traffic in the wake of the COVID-19 pandemic by creating incentivized resale events via experiential activation campaigns.

Attract new and loyal customers by partnering with local artists and sneakerheads in the community to create signage and displays. Entering the resale space makes it easier for brands to tailor their in-store experiences to sneaker culture, increasing revenue and promoting brand loyalty.

Taking a Cut of the $10 Billion Sneaker Resale Industry is Easy With a Recommerce Operating System

Trove partners with established brands, giving them the power to manage their brand equity within the resale marketplace. 

Companies like Allbirds are already using Trove’s Recommerce Operating System to create their own resale programs, allowing them to stay connected with valued customers. Allbirds uses its ReRun platform to encourage customers to trade in their pre-worn shoes for in-store credit. These prices can be set or powered by Trove’s pricing algorithms.

This encourages buyers to stay within the Allbirds ecosystem instead of selling and buying on the peer-to-peer market. The ReRun platform also aligns with Allbirds’ commitment to sustainability.

Sneaker brands can use technology to capture a larger share of the resale market, establish a community, and protect their brand equity from counterfeiters.

Profitable and sustainable growth is possible with Trove. Schedule a demo with us today!

4 Resale Strategies to Grow Your Brand

If the reported growth of resale hasn’t motivated your brand’s executive team to consider resale, they may be a bit behind on current customer demands. Brands racing to the resale market need to consider how to use brand identity and reputation to their advantage. In the end, brands are competing with third-party marketplaces.  

Circular models require changes in customer habits and making the transition as easy as possible is the best way to ensure it happens. Solutions to the logistical problems of resale and how to motivate customers and sellers are key to implementing circular models, which could help with climate issues and increase profitability.

Use the following strategies to ensure your branded resale launch is a success.

Streamline the Trade-In Process

With an influx of climate-conscious customers, not only is there no longer a stigma around resale, there’s a demand for it. The secondhand fashion market is predicted to reach $67 billion by 2025. But for that to happen, businesses have to meet customers where they are.

Circular business models, such as resale, have a unique need for customer involvement in supply. Shopping for high-quality items at affordable prices is already an established behavior. The concept of trading-in items is a new customer behavior and is critical to running a successful resale program. That makes accommodating customers and creating the lowest resistance paths for trade-in integral and essential.

One way to streamline customer experience is redundancy. Providing options for trade-ins, including in-store and mail-in, increases the chances customers have an option that suits their needs. For example, in 2021, REI gave members an option to trade in their used gear online or in-store for credits. After the program was introduced, the brand reported a 36% increase in overall sales

Incentivize Customers to Trade-In

However streamlined the trade-in process is, it still requires some action from customers, which creates another key aspect of the chain: customer motivation. 

Trade-in credits, gift cards, VIP perks, and exclusive experiences are ways customers can be motivated to take part in the supply chain directly. Customers may also be motivated by positive brand association and sustainability. Creating branded content that informs customers on how recommerce promotes sustainability and inspires them to take part could be useful tools.

Trove has the technology, analytics, and operations to ensure logistics don’t bleed into the customer experience. That means customers will be more likely to continue to participate in trade-ins and have a positive association with their branded experience. Trove provides end-to-end recommerce solutions to optimize circular supply and help businesses meet customers where they are.

Your Top Buyers Can Be Your Top Sellers

The demand for pre-loved items is high globally and in the US, but there aren’t nearly as many sellers. Around 44% of people in the US reported buying secondhand, which is a relatively large customer base. But only 24% of the population reported selling secondhand items.

While these numbers might cause concerns about the supply chain, there are solutions. For one, to successfully supply a branded resale channel, there just needs to be enough sellers to meet the supply demands of buyers.

If your brand doesn’t have a large enough group of sellers, there are opportunities for creating more sellers. Loyal customers could be the perfect target for seller recruitment. Create ways to entice customers that already interact with your business to start selling. This may be achieved through advertising, promotion, or even direct contact with email lists or social media. The most important part is to dispel the perceived difficulty of becoming a seller by implementing user experience and customer experience best practices in the selling process.

Maintain Messaging Around Sustainability

As discussions about climate change and sustainability became more mainstream and dire, customers began pressuring brands to implement sustainable practices. There are segments of your resale audience that hold sustainability as one of the main reasons they’re shopping secondhand.

Creating clear, easy-to-understanding messaging about how circular business models help decrease waste and promote supply sustainability could be a powerful marketing lever your brand can pull. This type of messaging attracts buyers and sellers motivated by sustainability.

The circular economy can be a complex topic to translate to customers. Ensure your content strategy is aimed at simplifying this topic while providing actionable next steps. For example, a clothing brand might want to focus on the extended lifespan of clothing items in a circular chain. Infographics, blog posts, and videos explaining circular business models are some ways to inform customers. We suggest distributing this content via owned channels like your socials and blog.

The Future Is Circular

The demand for pre-loved items and the need for sustainability are not going away any time soon. Utilizing circular business models like resale is an important consideration for executives worried about supply and brand sustainability. Learn more about these issues and how Trove works to solve them by scheduling a free demo today. 

Why Luxury Brands Are Saying Goodbye to Fashion Seasons

Fashion has long revolved around seasons, with the fall/winter season running from July through December and the spring/summer season running from January through June. Designers traditionally launch new spring/summer collections in September and showcase fall/winter fashions in March.

Smaller fashion shows would take place up to five times each year, driving shoppers toward the latest, trendiest designs and creating a short life cycle for each item. Preparation for the next fashion season would begin six months in advance, and stores would be stocked with seasonal clothing shortly after the new designs showed up on runways. New retail stock for mass-market consumption has a turnover of about two weeks, with new stock produced and shipped to stores multiple times per month.

Traditional fashion seasons have begun to give way to seasonless fashion, which puts the focus on high-quality garments with cross-seasonal boundaries and reduces the need for a new wardrobe twice each year. The pandemic served as a catalyst for this change, but evergreen clothing items had already begun to seep into seasonal collections in small ways over the last few years.

Some brands, including Michael Kors and Saint Laurent, no longer follow the traditional seasonal calendar when introducing new designs. Both Gucci and Prada stopped using the seasonal calendar to introduce collections in 2020.

The Benefits of Seasonless Fashion

The focus of seasonless fashion revolves around comfort, timeless designs, and long-lasting fabrics that can be worn longer than a few months. Seasonless fashion also improves the sustainability of the industry. According to WWD, “By shifting away from a calendar-based cycle, retailers and brands can avoid arbitrary cut-off dates, order quantities, and markdown cycles when there’s unseasonably warm or cold weather.

By loosening constraints, the seasonless model allows for the generation of other options, and thereby, better decisions and outcomes for business and consumers alike.” 

Garments Designed to be Timeless

Timeless garments are always in fashion, so the same outfit can work through spring, summer, fall, and winter. Modern fashion designers committed to a seasonless fashion philosophy create silhouettes that are always in fashion.

Multi-season designs can be adjusted to suit various weather conditions and seasonal trends. A classic blouse that can be worn alone in summer or with a sweater layered on top during the winter works year-round. Customers are more likely to wear timeless pieces year after year as well, which extends the lifespan of each item of clothing in a closet.

Creating a wardrobe of timeless fashion involves choosing base pieces that serve as a canvas for layered clothes and accessories. Long-lasting fabrics, such as linen, cotton, and silk, provide durability and textural appeal that less sturdy synthetic fabrics just can’t match.

Reduces Supply Chain Production Demands on Factories

Shifting to a seasonless fashion philosophy in retail and design spaces reduces customer demand for the latest trends. Factory supply chains run more smoothly since fewer products are needed, and the relentless demand for new styles is reduced.

Some fast fashion cycles involve periods of high factory use followed by between-season dips in production. A seasonless approach provides consistent work throughout the year for those in the garment industry, creating a better system for workers at all levels.

Reduces Impulse Purchases

Impulse purchases are often driven by a need to have the latest and greatest fashion item. The drive to always stay on trend plays into the relentless fast fashion industry. Advertising tells customers that they need to have the newest fashion items, and this drives designers to create new designs to fill that demand. Changes in small details, such as hem length or patterns, from season to season encourage customers to buy into the cycle of fast fashion.

The fast speed of production involved in seasonal fashion also leaves customers feeling pressured to buy items right away. Since trend cycles move quickly, an item on store shelves one week may disappear by the next week. Customers used to fast fashion may impulse buy clothes they like without thinking about long-term wear simply because they’re afraid to miss out on the design if they wait.

Seasonless collections allow for a more relaxed slow fashion approach to shopping. Items without a fashion expiration date remain available longer, so shoppers can take their time to decide which pieces truly fit into their existing wardrobe. Fewer impulse purchases also reduce over-consumption and address the growing problem of too-rapid trend cycles in the industry.

Less Waste

One major issue with fast fashion is that it often produces waste when trends go out of style. Fabric may become useless at the end of a season as new patterns or colors are introduced. Seasonless fashion gets around this problem by producing clothing designed to last more than one season instead of being heavily invested in trendy details. Fabric from a prior season can be incorporated into future clothing without the worry of it being out of style.

Some slow fashion brands focus on waste reduction at the factory level. Strategies used by brands to encourage seasonless design and reduce waste include:

  • Producing made-to-order clothing instead of using mass production of items that may not sell
  • Producing in smaller batches without changes between batches to protect against overproduction
  • Creating recycling programs to buy back older clothing items and using the recycled pieces to make new clothes

Less Focus on Clearance Items

Fast fashion that isn’t sold ends up going on clearance because retailers have to make room for the next season’s clothes. This leads to a cycle of overproduction, clearance sales, and devaluing of clothing.

When fashion isn’t tied to specific seasons and trendy details, there’s no need to put last season’s products on sale to make room for a new fashion line. Seasonless fashion can be sold year-round or moved into storage to return to the sales floor once the weather shifts again.

Why Is It Important to Adopt a Seasonless Model?

Polyester and other synthetic fibers are a major source of microplastic pollution in the environment. The fashion industry also accounts for more carbon emissions than international air travel and maritime shipping combined. Seasonless fashion cuts into the heart of this disposable clothing cycle by reducing demand and reducing the need to dispose of older pieces as they go out of fashion.

Slow seasonless fashion is sustainable fashion. As the industry shifts to a model where reusing clothing and investing in high-quality garments designed to last for years is the norm, fashion becomes more sustainable. Currently, about 11.3 million tons of textile waste are thrown away each year, over 2,000 garments per second.

At Trove, we partner with brands committed to creating sustainable models for the future of the fashion industry. Our revolutionary end-to-end technology, merchandising, and omnichannel supply generation approach empowers brands to extend the life of millions of products, creating more inclusive, less wasteful business practices.

Contact us today to learn how we can help your brand step into a new era of conscious commerce.

Third-Party Resale Marketplaces Pose a Bigger Threat Than Brands Think  

Fashion’s largest growing sector since 2020 is resale. Online platforms like ThredUp, The RealReal, Depop, and Poshmark have exploded onto the scene in recent years. This trend is causing a dramatic shift in the fashion landscape. The resale apparel market is projected to generate $77 billion in revenue by 2025 — more than doubling in five years!

The success of these third-party marketplaces has inspired some brands to create their own resale programs, while others are hesitant to jump onto the trend. The decision to create your own branded resale channel versus partnering with a resale platform has its own pros and cons to consider. 

In this article, we’ll explore why resale has seen such a boom in recent years, and the threats nonbranded marketplaces pose to brands. Finally, we’ll examine how forward-thinking companies are adjusting business models to capture a share of the resale market, maintain brand equity and acquire valuable data about customers.

Why Resale Platforms Are Booming

Perceptions of pre-loved clothing have changed over recent years. More shoppers are open to the idea of buying pre-worn clothes. In 2020, 33 million people made their first-ever purchases of pre-worn items in the United States. More than three-quarters of those plan to increase that spending in the next five years.

This change in behavior is driven largely by a desire to reduce our impact on the environment through sustainable choices. The amount of waste generated by fast fashion is sobering. The average American throws away 80 pounds of clothing every year.  Every second, the equivalent of one garbage truck full of textiles is burned or dumped in landfills.

The 2020 COVID-19 pandemic became a catalyst for altering shopping behavior in a couple of ways.

  • People who were financially impacted by the economic slowdown ventured into the online resale market to save money.
  • As lines blurred between work and free time the rise of sportswear and athleisure caught fire and are expected to grow by two-thirds from 2020-2023. Customers began to discover closets full of perfectly good items, they once wore, that now can be traded in for credit.

Combine these two factors and you’ve got a game-changer. Buyers who shopped at resale stores were happy to find pre-worn, name-brand items that were often in good condition and cheaper than retail prices. They could satisfy their desire to be fashionable while reducing waste and saving money.

3 Major Impacts on Fashion Brands

As more and more people turn to resale marketplaces to buy and sell clothes, legacy fashion brands are feeling the pinch. They’re now competing against their own products from past seasons on these platforms, which are eating into their sales. Businesses are losing access to customers clearly interested in their product line, while unable to manage the valuation of their products and brand image. 

These are the three major impacts nonbranded marketplaces have on fashion brands: 

  1. Customers Leave a Brand’s Ecosystem

    Marketplaces are often compared to online shopping malls, where customers can browse a variety of products from different brands and sellers. However, because in the secondary market these marketplaces source and sell items to customers, the brand is not involved, has no control, and makes no money on the items they designed, produced, and marketed.

    Once a customer is introduced to the resale platform, it’s easy for them to be pulled into the marketplace’s ecosystem. Fashion brands risk losing customers altogether, along with revenue and first-party data about their behaviors and preferences. Without these valuable business insights, it’s more difficult to target audiences and market to them.

  2. Brands Lose Control of Product Pricing

    Shoppers looking for a good deal on branded products often find success in marketplaces. In fact, some peer-to-peer marketplace vendors can list clothing at any price point, discounting items more than other sellers to attract the sale.

    Fashion brands have no control over how vendors value items, which can potentially impact their own pricing strategies. The availability of pre-owned products at a lower price than new products can keep customers in the resale market. Brands need to take ownership of their own resale channels to maintain control of shopper price sensitivity. 

  3. Lack of Branded Customer Experience

    Customers also have certain expectations when purchasing premium or high-end fashion. They expect quality and craftsmanship. Buying luxury is more than a financial transaction. It’s also about the experience of acquiring a coveted brand product and the VIP treatment that comes along with it.

    Luxury brands, and brands that follow the luxury model, rely on their connection with customers to deliver this experience. Customers must feel exclusive, valued, and important. A brand’s interaction with customers can reinforce emotions like happiness and loyalty. This can happen through exclusive events, premium customer service, or personalized digital experiences on a store’s website.

    The main goal of a third-party augmented marketplace is to move the product as quickly and efficiently as possible. There is no consistent branding across product images, and customers are not directed back to the brand’s ecosystem. 

    If brands implement an omnichannel branded resale program, they can control the customer experience. It is possible to create the same feeling of exclusivity, value, and luxury with a branded resale experience. 

    Win Your Customers Back with Trove

    Brands have spent the last five years trying to meet customer demands on delivery and shipping expectations. The logistics of adding a resale channel to that process can seem daunting, but it doesn’t have to be.

    Premium brands such as Lululemon, REI, and Levi’s are partnering with Trove to power their own resale channels. Trove is a comprehensive, white-label solution that delivers the technology for brands to offer resale at scale. 

    Our case studies show how adding a resale program helped brands like Eileen Fisher and Arc’teryx boost sales while promoting sustainability.

    Trove can help your brand with everything it needs to win in the resale space. Unlock the growth potential of a branded resale channel, and request a demo with Trove today.

What is Recommerce?

Recommerce is the practice of selling previously owned items.  While businesses such as thrift shops, jewelers, and automobile dealerships have been known for using “certified, pre-owned” models, the practice has gained momentum in other sectors over the last decade. Today, luxury and premium fashion brands are seeing profitable opportunities in recommerce. 

The term ‘recommerce’ was introduced in 2005 by a man named George Colony, CEO of Forrester Research, a global research and consulting company specializing in technology and B2B marketing. During an interview, Mr. Colony used the term when discussing the process of first-world countries selling outdated or ‘used’ technology to growing nations.

More recently, recommerce has become synonymous with online marketplaces such as TheRealReal, ThredUp, and Poshmark, where customers can buy and sell items. These new companies can be thought of as third-party marketplaces.

Why the Recommerce Revolution is Here to Stay

While pre-owned models have been adopted for many years, the current ‘Recommerce Revolution’ in retail is here to stay. This shift is customer-led and based on customers’ desire to shop in more sustainable and affordable ways. While the early evolution of the market has been led by third-party marketplaces serving the growing customer behavior, the future growth is via brands. 

Different than third-party marketplaces, brands have existing recognition, trust, physical store networks, and existing customers.  Hence brand involvement with resale will substantially grow the category.  Some brands are exploring this new demand by engaging with third-party resale platforms that offer Resale-as-a-Service to test the waters. These relationships are low effort to set up, however, the objectives of the partnership are different. Brands gain limited access to customer data and controlling merchandising activities such as pricing, grading the condition of an item, description and photography of an item. Lastly,  third-party marketplaces are incentivized to sell more stuff which is not the same as bringing in a new customer to a brand or building brand loyalty–so different objectives.

Over the past five years, new business-to-business platforms have emerged to support brands that want to enter the resale space themselves.  Trove pioneered these new platforms with partners such as Patagonia, Eileen Fisher, and REI in 2016, providing the trade-in, single SKU merchandising, operations, and merchandising technology necessary to scale a resale program 100% aligned with the brand.

From a sustainability perspective, recommerce offers brands a way to get more value out of an item they already made. This happens to also be a profitable way to grow their business without commensurate growth in their greenhouse gas footprint. More than 70% of a product’s environmental footprint is from upstream materials and production.  By allowing customers to trade in and purchase previously owned items, brands support more circular models that minimize the effects of new production–growing their business by selling their items multiple times. For example, it takes over 2,000 liters of water to produce enough cotton to manufacture a single shirt, and over 7,000 liters of water to manufacture a pair of jeans. In addition to water, manufacturing apparel requires multiple resources, including electricity and natural gas. By opting to include recommerce as a part of their business model, brands can reduce their overall carbon footprint. 

From a business perspective, leveraging the recommerce business model opens the door to a wider customer base that may have previously been unable to afford the prices of new luxury and high-end items. Additionally, selling premium items in good condition at more accessible prices gives brands an opportunity to make a profit a second time on the same item. 

How Does it Work?

The process of recommerce is essentially making items no longer being used sellable again.  These items are then merchandised and sold to customers through existing channels, online or physical channels. 

Trove works directly with brands to provide the end-to-end products and services solutions necessary to operate a profitable brand resale program at scale. For example, when a customer decides to trade-in previously purchased apparel to lululemon or Patagonia, Trove provides the technology for the brand to identify, price, and issue a gift card to the customer so they can purchase something in-store that day or online. This keeps the customer in the brands’ ecosystem or purchasing behavior to help boost the lifetime value of a customer and acquire new customers into the mainline business. 

Trove’s operating system provides the backbone for brands to identify, accept, route, price, and issue credit for any pre-worn item, no matter how worn or old. Then intelligently route millions of trade-ins and unlock the ability to resell previously unsellable items via branded websites. Trove’s merchandising technology for these single SKU items integrates directly into brands existing online and store channels providing true-to-brand photography, item listings, and trade-in credit along a seamless customer journey, allowing a new lululemon or Patagonia customer to find and purchase an item, getting more life out of premium items and growing the brands’ customer base.

Build Your Trade-In & Resale Program Today

Recommerce is rapidly becoming a preferred practice for shopping among customers of all ages. Resale is on track to become 20-30% of the closet of the future. Trove powers Resale as a Channel for the most innovative, premium and luxury brands, including Allbirds, REI, NEMO, Patagonia, and more, Trove believes businesses can grow without growing their carbon emissions.  Learn more about Trove’s mission and access case studies on its recommerce model by visiting the website today.