This week, ASDA confirmed the roll-out of an additional 295+ SMARTDrop mobile phone kiosks as part of their partnership with MusicMagpie. The goal? A further boost to ASDA’s sustainability credentials by expanding their recommerce offering AND (perhaps most importantly) a lucrative opportunity for the respective brands to increase their share of a hidden marketplace, valued at apx £16Billion in the UK.
A Hidden marketplace? Research indicates that the average UK household has 11 items of unused consumer technology in the household, items such as: mobile phones; cameras; consoles; CD’s and DVD’s etc. These items might be placed in draws, cupboards or hoarded in boxes in the attic. The value of some of these items may have been realised and sold on ebay for a tidy sum – however a significant percentage of these items still remain hidden.
The recommerce marketplace is in growth at the moment, due to consumers developing more responsible shopping habits, and retailers investing in the business model, in store and online. A recent YouGov study suggests that by the end of 2021 17% of retailers will start selling second-hand items in store, and over 30% offering a recycling service by year end.
Fashion brands such as Levi’s (Levi’s secondhand) and Gucci (The Vault) have recently established their resale business model to much praise. Fashion has always been an easy product sector to move into the resale marketplace – preloved clothing and secondhand clothes stores have been around for decades, however the ‘buy-back & resell’ marketplace creates a scale of management, control and profit generation that can only be achieved by brands establishing a workable framework, delivered through their DTC channels and with support from select third parties. Aside form financial, the additional benefit to brands is the affirmation of their sustainability credentials.
Aside from fashion, homeware giants John Lewis and Ikea have (or are planning to) introduced buyback / take-back schemes, the biggest hurdle here is a logistical one – the scheme requires the customer to take the item of furniture into store for appraisal and payment/credit, rather than schedule a costly pick-up service. Quite a tricky issue to overcome.
At a time when brands want to be seen as more democratic and accessible to the consumer, regardless of their spending power, having an inclusive price offering for pre-owned products will allows them to engage this consumer, and widen market and consumer appeal.
Recommerce is a developing retail economy, the value of which is being realised by the brands and retailers who are taking the steps to introduce this strategy for financial, sustainable or charitable gain.
Money for nothing? Get in the attic, search for your hidden treasure and help the environment too!