Its new 'Resale as a Service' platform makes it easy for conventional brands to join the circular economy.
The secondhand fashion industry is booming, growing 21 times faster than new fashion. thredUP is one retailer that's leading the charge, having grown exponentially since its creation in 2009. thredUP currently receives 100,000 used clothing items daily and has grand plans to scale up in the near future.
thredUP announced last week that it's launching a new platform called 'Resale as a Service' (RaaS). This is a unique opportunity for conventional clothing brands to partner with thredUP and join the circular economy. A partnership with thredUP offers the following options to brands: 1) an in-store pop-up, 2) online collaboration, or 3) a loyalty program.Consumer research has shown that loyalty programs are most successful. Glenda Toma explained how it works in an article for Forbes:
"In that model, when shoppers purchase an item from a thredUP partner, they are sent a co-branded 'clean out kit' — the bag that thredUP sellers use to send items to be resold. But instead of receiving cash, as they would in a direct transaction with thredUP, sellers in the loyalty program get credit to the partner retailer. thredUP keeps the markup on the resold item, and the partner retailer improves its customer retention; the individual seller, meanwhile, may get a bonus for using the loyalty program instead of going straight to thredUP."
Struggling department stores, such as Macy's and JCPenney, are hopeful that the pop-up option will attract greater numbers of visitors. Forbes says that the new in-store pop-up spaces will measure between 500 and 1,000 square feet and "will feature new items on a weekly basis, offering brands that aren’t already in a typical Macy’s or JCPenney. There will be 100 pop-ups by Labor Day."
Some impressive sums are backing the expansion. thredUP has received more than $300 million in funding to power this initiative, and founder/CEO James Reinhart is understandably delighted. He believes his company is at the forefront of a fashion revolution.
"The closet of the future... is going to look very different than the closet of today. If you think back 10 years ago when we started, you had none of these direct-to-consumer brands. There was no such thing as rental. There were no subscription companies. In just these 10 years, we’ve had a radical shift in how people shop and buy apparel. And I think that shift is going to continue."
Brands are realizing that resale is only going to accelerate in the future, and that they either have to participate in it or lose out. thredUP offers an easy way to get in on the market share. I think we'll be seeing a lot more of this in the near future.