With the overall retail industry expanding at a fast pace, millennials and fashion experts are looking towards more ways for saving money, time and resources. One such sustainable category of retail that has outgrown others over the course of six years is Recommerce.
Is this an incoming fashion trend or an emerging market? …
WHAT IS RECOMMERCE?
Recommerce or more commonly known as reverse commerce is a process that involves selling used or previously owned products through both physical and online channels. They are sold either directly to consumers or companies for repair and recycle, or for refurbishments for further reselling.
Most resale businesses focus on selling consumer electronics like smartphones, laptops, TVs, video gaming consoles, cameras and tablets. Physical media, books, consumer non-durables and clothing have a significant share of the emerging recommerce industry too.
DIFFERENT TYPES OF RECOMMERCE MARKETS
The recommerce market is divided into a number of categories:
1. Informal Market
This type includes selling goods directly from one person to another such as wholesale markets and flea markets etc. There are also informal online B2B marketplaces that exist on Amazon and eBay.
2. Recommerce Trade-In Services
This kind of reselling involves companies that purchase old and used goods, refurbish them and resell them over various channels. Most of the final products sold here are either recycled or have improved conditions as compared to before.
3. Buy-Back Trading
Buy-back trading is very common in the electronics sector where customers sell the product back to the same vendor they bought it from. Most of the time it’s the brand itself who offers buy-back services or 3rd party refurbishing companies that are specialized in used electronics for doing further reselling.
WHY ARE PEOPLE SWITCHING TO RECOMMERCE?
The recommerce industry, both online and offline, in comparison to where it started, has grown into a well-established market. Besides, it is also expected to turn twice its size in the next five years. The stigma associated with reselling and using used products is now way past everyone as most companies and fashion giants are spreading awareness regarding sustainability and recycling. The recommerce industry at the moment has a net value of over $20 billion with 25% in the United States only.
Read on below to find out why people are inclined to the emerging recommerce industry more than ever before.
1. Recession and Falling Economies
After many industries that were affected by the great recession and fluctuating economies, shopping became more of a toil. Consumers who were accustomed to shopping brands and high-end products started looking for other alternatives to shop for products that not only remained under their budget but also offered good quality.
This is the reasons why many switched to online marketplaces where refurbished products with improved quality were sold. The recession gave the recommerce industry a chance to prosper while also teaching people to shop and spend money where it is important and beneficial to them.
With global warming a massive concern, sustainability in industries and retail has been a great turn over. Be it the fashion world, electronics or consumer market, millennials have now started looking for ways to promote purchasing of goods that are environment-friendly, designed and recycled as long as they are in their valuable form. Instead of discarding or burning out unused products, many brands are selling off their goods to third party resellers who are either exporting them for reuse or refurbishing them for reselling.
3. Consumer purchase power
How many times have you thought of updating your wardrobe but couldn’t because of the already stacked pile of clothes? This is when the recommerce industry comes in handy. With so many online platforms, you can now sell your old products and acquire new ones within seconds.
As we move more towards becoming circular and getting creative to elongate the life cycle of products, buying second-hand products and reselling used ones will soon become a norm. This will create more opportunities for consumers to directly sell their used products and high-end brands to collaborate with recommerce industries for an environment-friendly trade.