Part of the appeal of second-hand clothing has always been the opportunity to find unique pieces that stand out from mainstream fashion, and for today’s individuality-focused Millennials and Gen Z this is a key factor in their purchasing behaviour. Global fashion search platform Lyst has revealed searches for ‘vintage’ and ‘second-hand’ products have grown 42% in the last year.
The “Better before” phenomenon
Millennials’ interest in nostalgia is another key driver, with many young people trawling old fashion magazines and paparazzi shots for style inspiration – as the 485m Throwback Thursday (#TBT) posts demonstrate.
Even fashion brands are trading off the interest in nostalgia, like Versace’s recent collections which have reworked archive prints and silhouettes, and Fendi, which has reissued the 90s-era Baguette bag to great fanfare. For the last couple of years, style-leaders and celebrities have been showing off their fashion knowledge by wearing iconic vintage pieces from Thierry Mugler, Azzedine Alaia, Jean Paul Gaultier or Versace collections.
Hype culture also has a role to play, with resale companies like Stadium Goods and StockX raising the profile of key vintage streetwear items, from old Supreme collaborations to rare Nikes. The result is a booming second-hand streetwear market, with sneaker resale said to be worth $1bn globally.
Second-hand is reshaping the luxury market
Many brands used to be concerned resale would undermine their luxury status, but analysts now argue that resale can be beneficial for sales – especially for the brands and products which hold their value when resold. Whether you call it pre-loved or second-hand, more and more clothing and accessories are experiencing a second life.
In fact, sales of second-hand luxury goods have reached a value of €22 billion in 2018, according to Bain and are expected to hit an annual value of $51 billion by 2023 to surpass fast fashion by 2028 according to GlobalData. A closer look at consumer generation shows Gen Zers to be the most active of all, with 54% of them engaging in the trade of second-hand items according to a BCG-Altagamma report.
Second-hand goods now account for 8% of the global luxury market, driven by Europe, which contributes more than half of the second-hand market. While vintage fashion has gained most of the headlines, 80% of all purchases come from watches and jewellery. Luxury stable Richemont is cashing in on this shift, recently acquiring UK online marketplace Watchfinder.
The second-hand market operates almost entirely separately from established luxury brands, with individuals selling their used items through online consignment platforms such as ThredUp and The RealReal. Sophie Hersan, co-founder and Fashion Director of Vestiaire Collective, the world leader of online luxury resale, comes back on the phenomenon and estimates that “more than 80% of pre-owned consumers buy online.”
A new fashionable order
On ThredUp, brands such as Frye, Kate Spade, Tory Burch, Burberry and Ugg are top ranked for resale value, while Vestiaire Collective highlights iconic bags such as the Hermes Birkin 35, Chanel Timeless Classic and Louis Vuitton Speedy. With young shoppers conducting in-depth research for luxury purchases, the resale value of key items is likely to play a bigger role in purchasing decisions going forward.
While many luxury brands are still evaluating how to deal with the potential threats and opportunities of the growing second-hand market, high-end retailers are leading the way. Selfridges’ London store launched a series of luxury second-hand pop-up shops in conjunction with Vestiaire Collective. “For us it was both the opportunity to reiterate our position as a key stakeholder from the fashion industry, with a true vision and interact directly our community of passionate customers,” noted Hersan. At each pop-up, shoppers could purchase iconic vintage items such as Dior Saddle bags, Prada nylon accessories, Tom Ford-era Gucci pieces and conceptual Margiela pieces from the 1990s. They were also able to sell their own pieces, with valuations and advice from Vestiaire Collective experts.
A reputation as a vintage clothing mecca can be a key motivator for globe shoppers’ destination choice. In Europe, London, Paris and Amsterdam are well-known for the range and quality of their second-hand stores and markets. In Asia-Pacific, Tokyo is renowned as a global hub of rare designer pieces and iconic denim, but in Chinese shopping cities the appetite for second-hand is only just emerging, perhaps due to the old superstition that second-hand clothes can bring bad luck. However, stylish stores like Hula and OnceStyle in Hong Kong are offering fashion-savvy shoppers something different, and Vestiaire Collective has established a new Asian hub in the city. The company reports that its Asian user base grew 200% in 2018, with a rising number of affluent Chinese customers flocking to its VIP consignment service.
The future of second-hand fashion
Driven by nostalgic millennials, celebrity style and sustainable consumption, second-hand clothing looks set to impact retail significantly in the coming years. “Circular fashion is one of the answers to alleviate the impact of the fashion industry on the environment, an issue which is now at the forefront of Millennials and Gen Zers’ preoccupations,” remarked Hersan, “the future will be focused on finding alternative and complementary solutions to the first-hand fashion market.”
Merchants should consider local sentiment about second-hand clothing and accessories when creating promotions or collaborations, but there is huge potential for luxury brands to showcase their iconic status with well-chosen collaborations and events.