How can brands benefit from an increasingly frugal consumers’ desire to buy secondhand?
Buying secondhand goods is no longer a shameful habit. It no longer needs to be hidden away like a kid in denial that most items in your wardrobe are hand-me-downs from elder siblings.
For today’s cash strapped consumer, cleverly tracking down a bargain secondhand purchase that is in high demand and great condition is something to boast proudly about in the pub or office.
New behaviours and trends shaped by the recession seem to have been a recurring theme in my columns, such as last week when I wrote about the ’alternative currencies’ of time and skills growing in popularity and back in May when I wrote about a new breed of budget brands and sharing/rental brands.
This week, the folks at Trendwatching.com have chosen to highlight the growing phenomenon of “re-commerce” in their latest trend briefing, discussing how trading in goods to trade up is becoming a common part of the purchase process for many consumers. Trading in has traditionally applied to the likes of white goods and cars, but today’s economic conditions have fuelled demand for secondhand goods in just about every category.
“Brand buy-backs, exchange schemes, online platforms and mobile marketplaces offer smart and convenient options for consumers keen to ’trade in to trade up’, alleviate financial strains and/or quell environmental and ethical concerns,” say the Trendwatching.com analysts.
I don’t agree with Trendwatching.com’s statement that considering a product’s resale value is becoming part of the purchase decision process, but I do believe resale is becoming a factor for consumers to justify new purchases, for example, not allowing yourself to purchase something new till you’ve got rid of the old.
The keen eBayers out there will know exactly what I’m talking about; using the online marketplace to sell off old party dresses to raise the funds for a new one. This has not only made eBay very successful but has spawned a range of secondhand clothing sites that also swap on top of selling, and some even specialise in designer brands.
The demand for secondhand-as-good-as-new items has spread to the mobile phone market too, with start ups such as Envirofone and Mazuma Mobile offering consumers cash for their old phones, which thanks to increasingly shortened upgrade cycles, have barely a scratch on them.
Not only are these firms growing their own brands, but some are working with mobile networks such as O2 and Vodafone to refurbish and resell the phones back to the market. The schemes are particularly lucrative considering the speed of which the smartphone and tablet market is accelerating – today’s iPhone 4S announcement will surely see an influx of old iPhone models into these channels to allow the late adopting new generation of technology shoppers a cheap deal on a refurb model.
Trendwatching.com also mentions the following case studies: Gazelle, a US electronic trade-in platform which bought 2,000 iPads an hour after the iPad 2 was announced; retailer Ikea which began selling secondhand furniture online in Sweden last year; French label APC’s scheme where customers could trade in used jeans to get half price on a new pair (APC then repaired and resold the jeans); and US based Deals Go Round, which allows users to resell Groupon and Living Social deals.
In the UK, Marks & Spencer has famously given £5 vouchers to customers who donate a bag of clothes to Oxfam. Cleverly, the clothes being donated must be from M&S in the first place and the voucher can only be spent with a minimum £35 spend. It supports its Plan A strategy to act in a more sustainable way, and is profitable.
As Trendwatching.com notes, “re-commerce” is a way to help the budget and the conscience. Since companies such as O2 and Ikea have incorporated re-commerce into their offerings, could your brand benefit from taking note of this consumer trend?