RESALE

Get thrifty

The resale revolution is upon us—shall we count the retailers? How about just one: Last week, Urban Outfitters’ parent company announced its very own resale marketplace, Nuuly Thrift. URBN Chief Technology Officer and Nuuly President David Hayne told Retail Brew more about the move.

“We’ve learned that more and more of our consumers are participating in secondhand marketplaces,” Hayne said. “An overwhelming majority of them have bought something on one of these marketplaces, either online or offline. Almost half of them have sold something.”

Recycling customers: URBN—parent to Anthropologie, Free People, Urban Outfitters, BHLDN, and Terrain—saw an opportunity to redirect the attention (and cashflow) back to its own house of brands. “Our brands tend to be some of the more popular brands on the resale market. We saw it as a gap that we wanted to fill,” Hayne told us. 

• Customers can sell used apparel for direct deposit or Nuuly Cash, which is worth 10% more than the offered value at Nuuly Thrift and for scores at URBN brands.

According to a recent ThredUp report, the secondhand market is expected to double to $77 billion by 2025. That big number, plus the low overhead of a peer-to-peer platform, is attractive.

“We’re just the facilitator of that transaction within the platform,” Hayne explained. “[Peer-to-peer marketplaces] have the potential to scale much faster because there’s not a lot of overhead for inventory or logistics.”

• URBN has been talking about entering the resale space for years, per Hayne, but development of the Thrift platform began in 2020 and has been underway for less than a year.

Rent is due 

Nuuly Thrift is a sister platform to Nuuly Rent, URBN’s subscription rental service that rolled out in 2019. The program was growing, until Covid. 

“2020 was a tricky year for the rental business. The need for rented apparel just wasn’t very high at that point with [customers] living at home and locking down [without] social events,” Hayne admitted. “We saw a fair amount of consumers pausing and canceling their subscriptions.”  

This past spring, Nuuly Rent rebounded to pre-pandemic subscription levels, and now has 30,000+ subs. URBN is hoping Nuuly Thrift will help continue to revive Nuuly Rent, and vice versa. (Rent the Runway had a similar thought.)

• Nuuly Rent will use Nuuly Thrift to sell some of its no longer rentable products, whether they’ve gotten too much wear or slight damage.
• Next year, customers will be able to pay for their Nuuly Rent subscriptions with Nuuly Cash earned via the Thrift marketplace.

Thanks, it’s vintage: Vintage vibes have always been a part of URBN's shtick, but Nuuly Thrift could make vintage a bigger part of the company’s identity, Hayne said. Or, perhaps more importantly, provide an extra channel for engagement.

+1: For resale to succeed as a growth channel, experts told us it’s crucial to make the operation simple for both retailers and consumers. Hayne agrees: “These marketplaces are appealing...because they’re pretty easy to operate. We’re planning to make the selling and buying processes as simple and straightforward as possible.”—JG

E-COMM

Scam spam

E-commerce has its benefits—shopping in your pajamas, for one. But many consumers saw its dark side last year. 

Scammers have swindled consumers out of $545 million in Covid–related scams since the start of the pandemic, per the Federal Trade Commission. The agency received 500,000+ complaints from Jan. 1, 2020 through Aug. 30, 2021; the most (55,000) came from online shopping, and totaled $45 million in losses. 

• People were duped by sites peddling pandemic staples like hand sanitizer.

A perfect storm: Covid and its uncertainty created ideal conditions for scammers, Jay Kennedy, assistant professor at Michigan State University’s School of Criminal Justice, told Retail Brew: “It’s really just been a repackaging to fit the pandemic, but it is ongoing. It started all the way from fake testing kits from the very, very early stages in early March.” 

• “As consumers, we are not accustomed to...being able to vet online vendors,” he added.

Friend or faux: Kennedy told us tools like TikTok Shopping—where “you have individuals as opposed to corporations who are controlling the marketing narratives”—can help legitimize the shopping experience for some. 

“Any time retailers are willing to make those connections and create stores on those sites that give customers easy access to their products, that is a very good thing,” he said. “The challenge is, how much does this—like many other forms of e-commerce—open up opportunities for third-party sellers? And then importantly, can consumers distinguish between the legitimate and the illegitimate?”—KM

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STORES

Off to the races

Allbirds and its IPO are the talk of the shoe world right now, but this week also brought news from another industry player: Hoka will open its first storefronts in New York City and West Hollywood, California. 

• “We want to learn more directly from the consumer...about what they like, what they want and how their decision process works, in a one-on-one way,” President Wendy Yang told CNBC. 

The Decker–owned company, which specializes in running shoes, signed two short-term leases but expects to extend them. The stores will feature 3D-scanning devices for sizing and lockers where customers can stash their stuff and do a test run. 

• “The biggest thing is creating a conversation with consumers in person and letting them experience the benefits before purchasing,” Yang said. 
• Hoka’s Q2 revenue jumped 95% YoY to $213.1 million.

The takeaway: The proliferation of online spending during the pandemic forced many retailers to evaluate their cross-channel experiences in-store, Katie Thomas, lead at the Kearney Consumer Institute, previously told Retail Brew. 

Athleticwear giants like Nike and Adidas want to move away from wholesale to focus on DTC, both online and IRL. So they’ve been investing in the experiential, in-person shopping experience to increase consumer engagement.    

• New Balance CEO Joe Hartsig told Retail Brew tech integration is a big part of how the company plans to enhance its in-store experience.—KM

WHAT ELSE IS BREWING…

• JD.com, China’s e-comm giant, now has a union. 
• Procter & Gamble is ramping up toilet paper production as demand increases. 
• Walgreens will raise its minimum wage to $15 an hour.
• Sequential Brands, parent of Jessica Simpson’s label, filed for bankruptcy. 
• Consumer confidence in the US hit a six-month low.

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SWAPPING SKUS

Today’s top retail reads. 

On trend: Marta Ortega Pérez, daughter of Zara’s founder, unlocks the retailer’s multibillion-dollar global vision. (The Wall Street Journal)

Red alert: Kitson, once deemed a Y2K “general store for the rich,” is using social media to spew pro–Trump and anti-vaxx propaganda. (The Cut) 

Next gen: Department stores are courting Gen Z with collabs, e-comm, and private labels. (Business of Fashion)

COMMUNITY

On Wednesdays, we wear pink spotlight Retail Brew’s readers. Want to be featured in an upcoming edition? Click here to introduce yourself.

Before becoming the art director for the luxury resale platform Fashionphile, Annie Grandon worked in design for an eclectic roster including HBO, Callaway Golf, Nordstrom, and even School of Rock. Before that? She grew up working in her family’s retail store.

How would you describe your job to someone who doesn’t work in retail? I’m given company goals and will find solutions to best tell that story or message visually and emotionally.

One thing we can’t guess about you from your LinkedIn profile: I’m a huge skincare guru and have been making my own for years.

What’s your favorite project you’ve worked on? I love working on any project where I can use my position to promote diversity, body positivity, and ultimately lift people up.

Which emerging retail trend are you most excited about this year, and why? I’m loving the “Available at your store” feature as an online option for those moments when you need something same-day.

ICYMI

Catch up on the Retail Brew stories you may have missed.

• Americans still eager to shop in person post-pandemic: poll
• Sorry, Dunkaroos: Nostalgia-hungry millennial parents crave healthier lunch box snacks
• Gap hops on the virtual fitting room trend with Drapr acquisition