Most of us know recommerce as resale of goods that will be used again. But the concept also includes circular models like sharing, renting or refurbishing and repairing. It’s one of the most important solutions to a huge problem that we face in society today – overconsumption.
The trend is clear on all of Schisbted’s marketplaces. Last year 40 million new private ads were posted on our marketplaces for recommerce – accounting for around 66 billion NOK in value.
On our Norwegian marketplace, FINN Torget, the number of new ads has increased by 13% since the beginning of 2023. From February up until today, the number of transactions on Swedish Blocket grew by 150%. Last year more than 15,000 deals were made each day on Tori in Finland and 39% of the Danes said they had sold one or more things on DBA compared to 27% the year before.
Looking at the whole market, the growth is even bigger internationally.
“The recommerce market is growing 4-5 times faster than ecommerce, and within the clothing section, a whole 16 times faster than traditional retail. It’s also expected to double every 2,5 to 3 years looking forward,” says Nora Dakos, Head of strategy for recommerce at Schibsted.
And between 2017 and 2021, the percentage of American consumers who had shopped, or were willing to shop second hand went up from 52% to 93%, according to Thredup resale report 2022. Statista reports that 50% of consumers worldwide cited affordability as the key driver behind choosing second-hand, followed by 40% driven mainly by sustainability.
Gen Z’s embrace of preloved fashion
Promising for the future is the fact that young customers are engaged.
“When it comes to Gen Z and the younger generations, these figures are even higher. Within preloved fashion, for example, Gen Z is by far the largest consumer segment, representing a far larger share within recommerce compared to fashion retail,” says Nora.
On Plick, Sweden’s largest Gen Z focused marketplace for buying and selling second-hand fashion, listings are increasing 60-70% year-on-year and daily transacted value is growing by 70-80%, also year-on-year.
So, why is this happening now? Nora explains that there are three main drivers – consumer demand, EU regulations and new circular business models.
EU regulations include the EU Taxonomy, which fosters green investments, and three circular economy packages. These packages introduce the ecodesign regulation, seeking to make sustainable products the norm, and the right to repair, aiming to make repair easy and attractive for consumers. The EU also wants to encourage more informed and sustainable consumption by giving consumers more rights and ensuring that businesses are not misleading consumers with false, or inadequately justified, green claims.
Additionally, businesses are making a big effort and spending large amounts of money on building more circular models. They are adapting and increasingly leading the change.
Refurbished electronics initiatives
“Nowadays, it’s almost impossible to walk into a store or open an app that has anything to do with shopping without meeting some flashy sustainability claims. And even if there is quite a lot of greenwashing – companies are also starting to adapt as consumers are demanding more truly sustainable options,” says Nora.
One example is the smartphone market. While global new smartphone sales have been declining by 3–12% every year in recent years, the refurbished phone market has been growing by 4–15%. Manufacturers like Apple and Samsung and carriers like Telenor and Telia are jumping on the trend.
But this trend has also created an entirely new vertical for online marketplaces, focusing on refurbished electronics that are making it easier for refurbishers to reach customers, and cheaper for consumers to buy refurbished products with the same guarantees and convenience as new products.
At Schibsted, we have launched refurbished electronics initiatives in both Blocket and FINN – Nybegagnad and Nybrukt – and the results are promising.
Overcoming barriers: convenience in recommerce
The main barrier for consumers not to follow the trend is convenience. Fiks Ferdig is one example of a service meeting these needs – it’s a payment and shipping solution used in FINN Torget that offers a safe and predictable transaction as well as smooth payment and shipping.
“As an actor in this area, you need to eliminate hurdles and remove barriers in user experience and convenience. We need ecosystems for circularity and leverage them to our customers,” says Nora.
Working with recommerce has made her see many opportunities that she believes can have real impact.
“If we really think of the resources we have, we can all be part of this superpower that could succeed with circularity. If we have a working model for giving goods a second life – we would not need any more new stuff.”