Our Director, Tim Roedel had a very interesting chat with John Williams from Amplience on The FOD - the Future of Digital Commerce podcast. With a global focus on the environment and sustainability, alongside economic uncertainty and an exponential rise in the cost of living in the UK, we suspect this will become a very hot topic this year.
It's recommerce. Recommerce involves brands reselling previously owned products at a discount — and it's booming.
According to Boston Consulting Group, the global recommerce market size is expected to grow by 15% to 20% annually over the next five years, compared to just 5.3% growth for fast fashion. Research suggests 223 million consumers say they have or are open to shopping second-hand products with Millennial and Gen Z shoppers prioritising buying sustainable goods.
Several factors are contributing to the rapid growth in this market.
The environmental impact of fast fashion
The fast fashion industry significantly contributes to damaging the planet. Currently, each week, roughly 15 million pieces of used clothing are donated from industrialised nations in the West and shipped to poorer countries such as Ghana and Sri Lanka. Historically, the clothes were good quality and were resold, however, fast fashion dictates poorer quality goods that no one wants to buy and they are consequently ending up in landfill sites causing severe health and environmental repercussions. Thankfully, the fast fashion industry is expected to stall or reduce over the next 5-10 years.
Recommerce brands
There is a rapidly growing list of traditional major retailers in the States such as Etsy, Farfetch and H&M launching second-hand initiatives. And many others are embracing sustainability, for example, Hunter boots are integrating recycled materials into their products. The likelihood is that these initiatives will make it to the UK before long.
Retailers are also seizing an opportunity to financially capitalise on a product's full lifecycle. Retailers with supply chains that are geared to work for in-store and eCommerce purchases AND for returning items online and in stores, enable retailers to sell their clothes as new and then again as second-hand across digital and store channels.
Recruiting tech talent
Along with the rapid growth in eCommerce, comes demand. As major retailers move to pivot their business to recommerce, hiring managers are left wondering how to recruit tech talent to deliver projects quickly. We are seeing demand for hiring tech jobs such as backend and frontend developers, quality assurance jobs and testing, mobile development, solution and enterprise architecture, and product owners and project managers with eCommerce experience becoming increasingly relevant and commanding higher salaries, more flexibility including remote working and more benefits.
With the cost of living increasing exponentially in the UK, and sustainability and environmentally friendly goods being top of mind for many, it makes perfect sense that recommerce is booming. Highly discounted goods will appeal to most kinds of consumers, and this is especially true if economic uncertainty endures.
If you would like to hear more on this topic, among others within digital commerce, click here to head over to 'The FOD' to hear Tim and John Williams chat on the podcast.
Sources:
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