These 4 Retail Execs Chose Resale, Here’s Why
The retail industry is evolving at rapid speed, but what has become clear is that resale is going to be a critical part of its future. Shopping pre-owned has already become a non-negotiable for consumers, and brands are taking note, with companies of all sizes looking to resale to add a new revenue stream while adapting to a circular economy. While there is no one-size-fits-all model for all players, Recurate’s leadership team is confident about branded peer-to-peer resale providing unique advantages. They hail from all ends of the retail industry: Adam Siegel, our CEO, from the Retail Industry Leaders Association; Karin Dillie, our VP of Partnerships, from The RealReal; Wilson Griffin, our COO, from Gap; and Cynthia Power, our VP of Brand Success, from EILEEN FISHER. They have either founded or gravitated to Recurate, understanding the power in a branded peer-to-peer experience. In their own words, here’s why they were eager to be part of the team building Recurate…
Adam Siegel — CEO & Co-Founder. Previously: Senior VP of Research, Innovation & Sustainability at the Retail Industry Leaders Association
Coming from RILA, what got you excited about resale?
“My last role was at the trade association that represents the largest retailers and brands, RILA. I was there for eight years, and I led a couple of initiatives: the first was Sustainability and Ethical Production, and the second was Innovation and Emerging Tech. Over that time, I saw the growth of the circular economy, and there was one business model in particular that caught my attention, and that was resale. The reason I got excited about it was: the most sustainable product you can buy, in most cases, is a used product. And the market for used products has been growing like crazy. I’ve been working with the brands and retailers that design, produce, market, and sell items firsthand. I thought it was crazy they weren’t benefitting from the second sale, third sale, fourth sale, or the fifth sale of all the items that they produce, much less do they even know the customers who are buying their items on third-party marketplaces. So that’s what ultimately led to the idea of Recurate.”
What sets Recurate’s peer-to-peer model apart from take-back?
“Take-back is where you hand it over to the brand. They take it to a central location, inspect it, potentially repair it, warehouse it, and then list it for sale. As you might imagine, there are a lot of logistical and operational costs associated with that, which means you’re not going to get a whole lot of money from the resale of that product. On the other hand, in a peer-to-peer model, which is our model, people list their own item for sale and keep it in their closet until it sells. Then they pack it up nicely and ship it to the new buyer. There’s only one leg of shipping and no operational or warehousing costs associated with it, so the real benefit is the seller gets more value, and the environmental impact is lower.”
Can adopting circularity principles be good for business?
“We see with brands we work with that there’s a clear revenue bump, and it’s because they’re adding a whole new revenue stream. It’s a whole new channel, and it’s attracting customers that otherwise would have gone to other third-party marketplaces that now get the opportunity to buy directly from the brand. It should be obvious to brands that if they can design and produce an item once and then sell it not just one time — but two times, or three times, or four times — that’s better. It’s better to sell something four times than to sell something once. We also find that there are improvements to loyalty and customer experience. It just makes a stronger brand.”
“[Resale] is a whole new channel, and it’s attracting customers that otherwise would have gone to other third-party marketplaces that now get the opportunity to buy directly from the brand.”
Karin Dillie — VP of Partnerships. Previously: Director of Business Development at The RealReal
How does technology play into the future of resale?
“What really interested me is bringing the concept of resale to the mass market — taking well-designed things and making it so these quality products are more accessible. That was what excited me about The RealReal, and then when I heard about Recurate, it was taking it even a step further. Technology makes it easier for people to engage in resale than ever before. And what I appreciate is that people who maybe can’t afford a brand’s price point will be able to buy from them secondhand. It goes back to the democratization of resale. We want to be the technology to power resale, and we want more people to be a part of it. Massive change needs to happen, and I think resale will be a big part of that.”
Have you noticed a shift in consumer behavior around resale?
“The behavior has already changed. It’s just that brands are catching up with it now. Over the past 13 years, it’s been interesting to see how consumer behavior has started to shift brand behavior. People want stuff they can actually resell, and they’re already buying secondhand. The way I think about resale going forward is that now I can go to Poshmark or The RealReal, directly to a brand’s site, or to my local consignment store. It’s going to be as diverse and differentiated as retail is right now. I believe resale will be similar. And with our technology, people can buy new and secondhand together. And to me, that is the future.”
Wilson Griffin — COO & Co-Founder. Previously: Director of Sustainable Innovation at Gap Inc.
Going beyond sustainable production, why do you see resale as the next step?
“My last role at Gap Inc. was focused on environmental sustainability — things like renewable energy procurement, packaging and waste reduction and “end-of-life,” and carbon emissions goal setting. What makes me so excited about Recurate is that instead of incremental improvement — like making products a bit more efficiently — resale is a real step-change for the industry. It allows a brand to monetize an item multiple times, which is such a massive improvement for both the brand and the usage of the item. The natural evolution after making products better is to ensure they are used for as long as possible and that the brand sees the benefit from that.”
As brands evolve their sustainability goals, will resale be more of a focus?
“Absolutely. A secondhand item is hands down the most sustainable item a brand can sell or a customer can buy. There is zero manufacturing impact of the second sale of that item. And the peer-to-peer model requires a single leg of shipping with no warehousing.”
Why did you opt for a peer-to-peer model over take-back?
“Customers have proven that they are comfortable buying and selling directly to each other, and they continue to prove it every day on Poshmark, eBay, Depop, etc. The growth will really come as brands begin to encourage that behavior and host it in their own environment. With that comes reduced friction for sellers and improved confidence for buyers. That is what we aim to do every day at Recurate.”
“A secondhand item is hands down the most sustainable item a brand can sell or a customer can buy.”
Cynthia Power — VP of Brand Success. Previously: Director of EILEEN FISHER Renew
How did your experience at EILEEN FISHER prove that resale was going to be BIG?
“The take-back and resale program started in 2009 at EILEEN FISHER. It started as a little project that was really intended to help fund a non-profit. It was a creative idea that took off and did really well. As the program kept growing, the value proposition felt pretty clear to the company. Once we created a website in 2017, I was shocked by how quickly it was growing and how big it was getting.”
Who’s shopping pre-owned? Have you noticed a recent shift?
“Yes, definitely. I think there was kind of an ‘ick’ factor around used for a long time, and I feel like in the last few years it’s just gone away. In my experience, Boomers are the most hesitant about buying used. But then you have Gen X that’s more interested. And then Millennials and Gen Z that are very interested in buying used. It’s already something that’s really normal, especially for younger generations. So I think the more technology there is that makes it easier to shop pre-owned — on your phone, or anywhere — the more behavior we’ll continue to see.”
Why do you think branded resale is here to stay?
“I think that more people are moving toward caring about specific brands and that there’s a growing emphasis on brand loyalty. I think we are definitely headed toward a more brand-centric future, and that behavior will continue to increase. In terms of customer loyalty, I can’t imagine a scenario in which brand loyalty doesn’t increase when you have your own resale program. I think about it in the used car industry and how normal that is. I bought my used car from the brand that made it originally. I like knowing that it has that stamp of approval. I think a lot of that ‘ick’ factor goes away when you’re buying from the same brand or when you’re buying from a marketplace that has really authenticated it.”
Visit www.recurate.com to learn more about Recurate’s resale program.