Thredup, The Concept of the Month
The U.S. pure-player which specialises in second-hand fashion expands to brick & mortar retail with a pop-up to boost brand visibility.
USA. On September 23, Thredup opened a pop-up store in Brooklyn exclusively dedicated to the very popular Madewell brand (a subsidiary of J. Crew). It is within a Madewell men’s store and near a Madewell women’s store.
Called “A Circular Store”, the store sells blouses, trousers and dresses priced between US$10 and US$40, remaining open until 31st October. “The whole experience is structured to promote brand visibility”, said Derek Yarbrough, Marketing Director of J. Crew and Madewell. “This pop-up is not about revenue”. The store offers workshops (advice, sewing and repair) and a customer sales path built around QR codes. Visitors scan them to watch videos on the theme of fashion life cycle and recycling. This project is an extension of the “Madewell Forever” website that sells second-hand jeans, launched in July by the two brands. On Thredup’s platform, Madewell is one of the most sought-after brands, with products selling an average of 26% faster than other brands.
As a reminder, Thredup’s model highly differs from Vinted. Users send clothes to the company, which puts them on line after inspection. The site displays a unified offering (similar photos, description…). When a customer buys an item, Thredup pays the seller a percentage of the price, ranging from 3% to 80%, depending on factors such as the quality, seasonality and selling price. Thredup has a deal with Walmart, so that U.S. customers can find second-hand items directly on Walmart.com. Since March 2021, it has been listed on the Stock Exchange, like competitor Poshmark.
In the quarter to June 2021, Thredup’s turnover reached US$60 million (up 27%) via 1.3 million active customers (up 8%) and 1.2 million orders (up 22%). However, net losses of the website more than doubled in one year to US$14 million. In Europe, the second-hand fashion market is estimated at US$21 billion. In the U.S.A. following a 14% fall in sales last year, figures are expected to return to 2019 levels of US$28 billion (Coresight Research). It is growing twice as fast as the overall fashion market.