The growth of the ‘recommerce’ market – the re-sale of refurbished, previously-owned products – is being driven by Milennials and Gen Z consumers, with more than half stating that they purchase pre-owned items regularly.
A report from ShipStation, a provider of online shipping services, found that among UK consumers, more than a third (34%) choose to buy pre-owned items instead of new items each month, while 37% increased their purchases of pre-owned or refurbished items over the past year, as awareness of circular economy thinking grows.
Younger demographics drive the market
The recommerce market in the UK is worth around £7 billion, according to Barclays, and ShipStation‘s research indicates that it is the younger demographics that are driving the market forward.
Millennials and Gen Z are at the forefront, with 58% of Gen Z and 50% of Millennial respondents reporting that they buy pre-owned items weekly or monthly. In contrast, over a quarter (27%) of Boomers indicate that they never purchase second-hand items.
Across all age cohorts, however, lower cost is the primary reason cited for purchasing pre-owned items, along with the desire to find higher quality items at a lower price. In addition, more than a quarter (27%) of British consumers point to environmental concerns as a significant factor in their decision to buy second-hand.
To leverage this trend, SMEs should consider broadening their inventory to include pre-owned goods, focusing on cost savings and the appeal of unique finds to attract a wider customer base, ShipStation notes.
‘A Significant Opportunity’
“Recommerce is undeniably here to stay, and this presents a significant opportunity for retailers to prepare for peak season,” commented Matthew Trattles, Vice President of SMB at Auctane, ShipStation’s operating brand.
“Our survey underscores that recommerce isn’t just a fleeting trend; it’s a significant shift in consumer behaviour. Retailers need to stay ahead of evolving consumer habits, focusing on cost-saving and unique items to meet customer demands and stand out in the competitive retail landscape”
While recommerce continues to grow, a number of factors still discourage consumers from making repeat purchases. The most significant deterrent is high shipping costs, cited by 71% of consumers as a reason to avoid returning to a retailer.
As well as this, certain generational differences emerge: late deliveries are a major issue for Gen Z (46.2%) and Boomers (48.3%), while poor packaging is the key factor that deters Millennials (35.7%) and Gen X (35.4%) from purchasing from a brand again. Learn more here.
Read more: Six in ten Gen Zs and millennials ‘anxious’ about climate change
