Etsy’s blockbuster $1.6 billion acquisition of the online and mobile vintage, used clothing, and repurposed fashion retailer Depop is being hailed by observers as a grab for the wallets and attention of Gen Z consumers.
But this emphasis on the demographics of Depop’s customers obscures another, vital, part of the company’s business — sustainability.
There’s a solid teardown of Depop’s prospects — and the broader resale market — in the March issue of Mission Magazine, which highlights the depth and breadth of the used and repurposed fashion market.
Depending on how you slice it, fashion represents about 10% of global carbon emissions. So services like Depop (and its competitors including ThredUp, Poshmark, and The RealReal), which sell consignment, used clothing and vintage goods offer a way for consumers to reduce those emissions by buying things whose footprint is now only their shipping and cleaning costs.
Thrift shops and used clothing stores have been a staple of the fashion (and environmentally) conscious consumer for decades and online marketplaces for selling random stuff have been around since the dawn of the internet thanks to Pierre Omidyar and his wife’s penchant for Pez dispensers (which led to the creation of eBay).
Depop and its fellow doyennes of mobile commerce offered a glow-up on eBay’s model by combining it with social networking and seamless payment integrations for individual shop owners.
A 2019 pre-pandemic sales report from ThredUp indicated that the industry could be worth $51 billion and big businesses are starting to take note.
Companies like Trove and Treet are taking the resale model to brands themselves, giving them the opportunity to create their own virtual resale storefronts.
For Trove, which was formerly known as Yerdle, the business model has nabbed customers like Eileen Fisher, Patagonia and REI — and about $45 million in venture capital funding, according to Crunchbase.
Meanwhile, Treet has raised $2.8 million for its own spin on the offering. The company basically makes a white label version of Depop that brands can host on their own site, based on inventory that customers have bought directly from the brand.
“We can onboard them in under a week and set up their custom Treet site and integrate it with their Shopify site,” said Treet chief executive Jake Disraeli. “Once the site is live… uploading the photos, their customers can log in and list items directly from their order history.”
“It’s all peer to peer selling,” says Disraeli. “We’re coaching our sellers to clean the items to make it look pretty to add notes. We send them a prepaid USPS shipping label. We take a percentage of every item sold. It’s 10%.. The sellers get to decide if they redeem their sales as cash or credit back to the brand.”
Other startups are giving local used clothing stores the infrastructure to get online and start selling their own wares virtually. Those are businesses like Thrilling, an Urban.us portfolio company.
Behind these businesses that focus on reuse and resale are some hard facts about Americans growing problem with fashion waste.
These days, rubber, leather and textiles account for roughly 9% of the 292.4 million tons of municipal solid waste generated in the U.S., according to EPA data from 2018. That number is just expected to increase given the current demand for fast fashion.
Image Credit: Environmental Protection Agency
For Trove founder Andy Ruben, who previously ran sustainability initiatives at Walmart, the explosion of interest from brands is just an indicator of the new reality for the fashion industry.
“The distinction between new and used is an old-school distinction that will be erased,” Ruben told Forbes earlier this year.