Original source: Sam Chambers - The Times
Twentysomethings are buying and selling millions of pounds’ worth of ‘pre-loved’ clothes on Depop. Sam Chambers investigates the threat to big retail chains.
After moving to London for university, Fiona Short loved nothing more than going to the East End Thrift Store in Stepney Green, paying £20 for a shopping bag and stuffing it with as many vintage clothes as she could fit in. As her wardrobe groaned and her money ran low, she turned to Depop, a fledgling online marketplace, to see whether other fashion obsessives would buy some of her unwanted clothes. Short, whose parents are antique dealers, quickly realised she had stumbled across a big opportunity.
What began as a way to clear out her belongings turned into a money-spinner. Over the next seven years, Short, 26, sold more than 6,000 corsets, skirts, tops and shirts, and amassed 185,000 followers on Depop. Now she stays up into the night swapping tips in her “Depop house” in Hackney, east London, which she shares with two other sellers.
“My parents are proper old-school wheeler-dealers. They couldn’t believe the trade had gone online and a bunch of kids were making the same money as them,” Short said.
Short is one of a new breed of Generation Z entrepreneurs selling “pre-loved” clothes on Depop, an eBay-style online marketplace for the Instagram masses. After Depop almost doubled its user base to 27 million during the pandemic, one in three 16 to 24-year-olds has an account. For comparison, fast-fashion giant Asos has an active customer base of 25 million.
Buying second-hand through Depop allows a more sustainably minded generation to indulge consumerist impulses without compromising their values. Its burgeoning popularity and the embrace of “slow fashion” more broadly poses a looming threat to high street chains struggling back to their feet after Covid.
Simon Beckerman got the idea for Depop in 2011 while trying to save cultural magazine People in Groove from falling victim to the digital revolution. He wanted to create a marketplace allowing readers to buy the goods they saw in the magazine — but with apps taking off, he soon saw a bigger opportunity to create something for a generation immersed in social media.
In 2012, Depop launched in Italy and then in the UK, which is now its biggest market with 10.5 million users. As well as buying and selling second-hand “garms”, Depop users can follow influencers, “like” particular pieces and message each other. Amusing ones are often shared with Depop Drama, an Instagram account that anonymously re-posts the best to its 500,000 followers. The twentysomething behind the account has started selling T-shirts emblazoned with messages such as “not my problem bab xx” and “don’t call me hun”.
Those who joined Depop early have reaped the rewards. In 2016, Asal Tehrani (@susamusa) started selling on her first day at King’s College London and has never looked back. Encouraged by how quickly her first 40 garments sold, Tehrani splurged £900 on 200 pairs of flares she found at a market. Her “side hustle” soon took precedence over her chemistry degree and today she sells about 1,000 garments a month, many manufactured using offcuts at her west London studio. “On Monday I woke up and I was just scrolling through Instagram and I saw a photo of Bella Hadid wearing something she had bought from me. That just makes it all worthwhile,” Tehrani said.
Isabella Vrana (@bellavrana) scrapped plans to apply for jobs in the fashion industry to go full-time on Depop, where she sells styles from the Nineties and early Noughties inspired by Rachel from Friends. Vrana, 23, uses TikTok and Instagram to alert her 100,000-plus followers to weekly “drops”.
“The fashion industry is intimidating. If your aunt isn’t Stella McCartney or something then you don’t have a chance of making it. I’m absolutely loving what I’m doing,” said Vrana.
Worries over global warming, financial insecurity and the proliferation of social media have driven the boom in the resale market. Analysts at GlobalData forecast that the American market for resale clothing will grow from $7 billion in 2019 to $36 billion in 2024. Two American sites — Poshmark and ThredUp — have cashed in with stock market listings that valued them at $3 billion (£2.2 billion) and $1.3 billion respectively. Clothing rental services such as Hurr Collective and My Wardrobe are growing in popularity, too.
“This generation really cares about sustainability, where products are manufactured and who the company is employing — even down to whether they have a diverse board. It genuinely matters to them,” said Devran Amaratunga Karaca, chief executive of Kyra, a media company that advises brands on how to market to Gen Z consumers.
Peter Semple, Depop’s chief brand officer, says buying second-hand allows young consumers to get the “constant newness” they crave without sacrificing their principles. “Living on TikTok and Instagram means they are constantly representing themselves publicly and they don’t want to be seen wearing the same stuff,” he said.
Maximilian Bittner, chief executive of resale site Vestiaire Collective, believes cheap prices are driving growth but the feelgood factor of buying second-hand is spurring young shoppers to brag about purchases on social media, providing a useful tailwind.
Still, the sustained growth of the scandal-hit fast-fashion giant Boohoo, which pumps out dresses for £5 and T-shirts for £3, indicates that accessible, cheap fashion continues to trump sustainability for a big chunk of Gen Z consumers.
Depop, now run by chief executive Maria Raga, takes a 10 per cent cut of every transaction on its site. After raising more than £80 million from investors including Benchmark, the first investor in eBay, Raga is focused on building its community, with a particular focus on expanding in America.
Looming over Depop are the 800lb gorillas of social media, which have plans to get young audiences shopping through their platforms. In America, Instagram is trialling in-app purchases that will enable businesses to sell directly to its one billion-plus users. The video sharing app TikTok has a partnership with Shopify.
The resale trend is creating vast secondary markets, particularly in trainers. Young “sneakerheads” routinely form long queues outside JD Sports and Footlocker whenever they “drop” limited edition trainers from Nike or Adidas. Depop is also trying to crack down on “dropshipping”, where sellers find a corresponding product on a cheap ecommerce site and then list it on Depop at a vastly inflated price. Meanwhile, established sellers admit that they benefit from Depop’s algorithm, which they say makes it harder for new sellers to build up a following. Depop said the number of items a seller lists or sells has no bearing on its search rankings.
In 2019 some £266 million of purchases were made through Depop, translating into sales of £21.4 million for the site and a pre-tax loss of £15.5 million. Regardless of whether the platform manages to become profitable, a growing number of the fashion industry’s established players feel they cannot ignore the popularity of the resale market.
“Resale is absolutely in the sweet spot of how consumers are feeling about everything right now. It has always been there but Depop is the first company to really sex it up. Their growth has been phenomenal and we are watching it closely,” said a senior source at one of the UK’s leading online fast fashion firms.
John Lewis is exploring ways of renting products or creating a second-hand marketplace of its own, while sales of Asos’s “reclaimed vintage” ranges, launched in 2016, increased by 92 per cent last year. Selfridges sells used fashion and jewellery, and offers a designer rental service.
As retail giants tinker around the edges, Depop’s influencers sense a power shift. Celia Marment (@celiapops), 21, is amazed that the high street has not cottoned on to the demand for low rise jeans and mesh tops sweeping through Depop.
“As the platform grows, we are becoming the directors of what happens in young fashion,” said Short, the resident of Depop House. “I really see that now.”
Web v stores— a question of carbon
The hordes of twentysomethings and teenagers shopping on Depop believe that by buying second-hand they are doing their bit for the planet. What some may have forgotten is that the van delivering their clothes is spewing fumes into the atmosphere.
The explosion of demand for online shopping has ignited a debate over its environmental impact — and who better to settle it than Amazon?
The tech juggernaut commissioned a report by consultancy Oliver Wyman comparing the combined impact from deliveries, packaging and energy use in warehouses with the impact of consumers buying from old-fashioned bricks and mortar shops. It claimed that physical retail creates twice the level of emissions per product sold compared with ecommerce.
The consultants, who said their report was produced independently, calculated that every kilometre driven by a delivery driver in London saved nine kilometres driven by people travelling to shops in their cars.
The study, though, was predicated on the idea that an online delivery replaces a trip to the shops, when in many cases, customers still go to the shops anyway, to seek ideas that then inform online purchases. If online retailers are doing their job right, they will also be stimulating demand that did not exist before.
Efforts are afoot to make online greener still. New warehouses are being kitted out with photovoltaic, or solar, cells on roofs that can produce much of the electricity they require. Electric charging points for vans are becoming standard on new developments.
The courier DPD has opened four parcel depots that use electric vans to make “last mile” deliveries. Globally, Amazon aims to have about 10,000 electric delivery vans on the road by the end of next year.
Three other disruptors
The Nu Wardrobe
Gen Z members are less interested in ownership than previous generations, and the Dublin-based platform Nu Wardrobe offers short-term borrowing as well as permanent swapping. Since its launch in January last year, the service has grown to 10,000 users.
StockX is a market where users place a bid or field an offer for electronics, streetwear and trainers. It has benefited from the marketing strategies of Nike and Adidas, whose limited edition trainers have created an enormous secondary market. A pair of Nike SB Dunks sold for $51,950. In total, goods worth a total of $1.8 billion were traded on StockX last year, helping to drive up the platform’s valuation to $3.8 billion.
A clothing resale platform that is even bigger than Depop, Vinted has amassed 37 million users across Europe and America since it was founded in 2008 by Lithuanian entrepreneurs Milda Mitkute and Justas Janauskas. Unlike Depop, it does not earn a commission on sales and the clothes tend to be high street brands rather than vintage finds. A fundraising valued it at more than €1 billion (£870 million) in 2019, giving Lithuania its first tech unicorn.
Original source: Sam Chambers - The Times