2PM - No. 707: A 2PM Exclusive

A. The News / New York Times: The cash deal, which is expected to close by the third quarter of this year, underscores the growing influence of clothing resale platforms. More shoppers are turning to the secondhand market for something cheaper and — potentially — greener as the overproduction of clothing increasingly adds to landfills.

Editor's Note: ReCommerce is heating up. In story "B" for the day, Rent the Runway has also invested in new resale operations, a move that will appeal to younger consumers. Customers of ROTR will be able to buy used designer clothes from the retailer. 

That DIY spirit makes Depop a decent match for Etsy, which has built a massive marketplace for indie sellers who hawk everything from wedding dresses to glassware to baby gifts. With it, Depop brings an attractive customer demographic right into Etsy’s lap: 90% of Depop users are under 26. Etsy, most known for kitsch and twee products, now has a cool, more cutting edge marketplace under its umbrella.

Consolidation in the marketplace sphere is not surprising. Competition has swelled alongside activity in the past year, and players in the space are on the same playing ground as mass-volume companies like Amazon. At the same time, niche marketplaces have become more and more powerful, with companies like StockX and Poshmark either planning to or taking their companies public. With Etsy, Depop can better compete in areas like fulfillment and logistics, which can be costly for smaller marketplaces. Depop did $70 million in revenue in 2020. Not one of these niche marketplaces are enough to take on Amazon, but power in numbers can do a bit of damage in areas where Amazon would otherwise steal more market share.

For Etsy, Depop could be the key to taking its fashion business to the next level. While Etsy’s apparel business is worth $1 billion alone, there are many other places people go to shop for new as well as used fashion. Here, Etsy is establishing a strategy to build that up with Depop, which will keep operating as a separate company, and with that build up a customer base of Gen Z thrifters. Smart bet.

Rent the Runway enters $33 billion fashion resale market as it looks to build back from pandemic lows

B. ReCommerce / CNBC: Customers will soon be able to buy used designer clothes from the business in addition to renting them. No membership will be required, as Rent the Runway looks to broaden its reach and give shoppers more feasible entry points.

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Sephora is betting that social commerce will catch on in the US

Linear Commerce / Quartz: Shortly after the photo-sharing app enabled companies to set up digital storefronts on its platform, Sephora debuted its Instagram shop. Its 20 million followers on the network could now find and buy its beauty products directly through the app, without having to switch over to the retailer’s site. What it has learned in almost a year since speaks to both the challenges and potential for social commerce in the US. “Every indication is that it’s going to be big,” said Carolyn Bojanowski, Sephora’s general manager of eCommerce.

From the archives (co-written by Ana Andjelic): Where, how, and what we buy is constantly changing. A scenario where a consumer relies on their Amazon Alexa to order “the dress that Emma Hill wore on her Instagram post from Wednesday” is just as probable as buying that same dress, directly from Emma Hill’s Instagram account. The tools of the trade evolve, the funnel shortens and widens, commerce becomes linear. There’s no better example of this than on Instagram, where the lines between brand, promotion, and commerce continue to blur. 

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What the Stadium Goods and Christie's collab says about the state of sneaker resale

Luxury / Vogue Business: Following on from a smaller-scale initiative with Sotheby’s in 2019, Stadium Goods is partnering with Christie’s on an online auction this month that features over 90 variations of Air Jordan sneakers, priced from under $1,000 to over $100,000, Vogue Business can exclusively reveal.

Sean Combs to launch marketplace for black entrepreneurs

eCommerce / WWD: Sean "Diddy" Combs has put together a consortium of leading tech and digital companies to launch Shop Circulate, an online marketplace for consumers to shop products from Black entrepreneurs. Those involved in the formation of Shop Circulate, expected to go live later this year, include The Nile List, Official Black Wall Street, Marketplacer, Salesforce and Deloitte Digital.

Editor's Note: I found this odd that Salesforce led the charge here and not Shopify. 

Uncertainty lingers, even as consumer confidence rebounds

Trends / Retail Dive: Researchers at First Insight say their studies indicate that spending patterns may be undergoing a long-term shift, with consumers "not quite ready to begin spending at pre-pandemic levels." Fifty-nine percent say they still expect to cut back on spending compared to before the pandemic, only a slight improvement from last year's 62%.

How Article built a leading DTC furniture company without tens of millions of venture funding

DTC Brands / Forbes: Our driving force was to build something that matters, build something that will last, and you can't do that without a strong profit formula underneath everything else that you're doing. We always had that as a consciousness and worked on that. I think that's one aspect that allowed us to get to profitability early and reduce the need of funding overall, to begin with.

Breaking News. This is a story about a pioneering direct-to-consumer leader with a capable team and the humility to take an idea, collaborate on a strategy, and achieve a positive outcome. The resulting partnership will greatly influence parts of the CPG industry.

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