What’s driving the rise of resale
Nike Refurbished is just the latest secondhand initiative from a major retailer in recent months. Last October, Levi’s launched Levi’s SecondHand, an online site where customers can buy used and vintage denim jeans and jackets, and Gucci started selling pre-loved items through a partnership with luxury consignment platform The Real Real.
“From a customer perspective, resale is driven by a wish to get one’s hands on desirable fashion items at a lower price as well as experiencing the fun of treasure hunting for something unique,” Anna Forster, sustainability strategist and co-founder of The Purpose Agents, told Inside Retail.
“At the same time, consumers are becoming more and more conscious of the environmental impact of throwaway fashion consumption and the opportunity to extend an item’s life through buying secondhand.”
According to ThredUp, a digital platform in the US that enables consumers to buy and sell secondhand clothing, the resale market grew 21 times faster than the retail market overall in 2016-2019, and is expected to be worth US$51 billion by 2023.
“Brands have been watching the resale market on marketplaces and through independent resellers from the sidelines for the longest time but are now increasingly entering this space to themselves harness the opportunity to generate additional sales of their own products and also to drive brand equity,” said Forster.
How resale could impact Nike’s brand
The move into resale positions Nike even more firmly as an undisputed leader in the sustainability space, according to Sydney-based retail consultant, Rosanna Iacono, who held various roles at Nike from 1992 to 2001.
“From their Reuse-A-Shoe program, which started way back in 1995, to their Open Source Sustainability guide, where they share all [their] sustainability innovations with the entire industry, including their competitors, in order to better the world, this is really true to their brand ethos,” Iacono, a managing partner at The Growth Activists, told Inside Retail.
“As a Nike alumni I can attest to the fact that their corporate culture is purpose-driven and that they would be very genuine in their commitment to the conscious consumption movement, but also that they would not see this as mutually exclusive to other commercial goals. There is also a nice angle to it in terms of creating price accessibility to a customer who may not be able to afford full-priced Nike products,” she said.
And selling secondhand items alongside brand-new products, as Nike plans to do, shouldn’t have a negative impact on the brand or store experience, according to Iacono.
“The combination of selling both new and secondhand sneakers in branded environments that are aspirational is already happening, through websites like StockX, Grailed and GOAT. The Gen Z and younger millennial consumer is already accustomed to this,” she pointed out.
“Overall, I think it’s a smart strategic move to get into resale, which is one of the fastest growing segments of fashion, and which is set to become bigger than fast fashion (which is in decline) in the coming three years. It’s a strategically savvy move, and one that will resonate strongly with the values of their customers.”
How Nike Refurbished works
Shoes must either be like-new, gently worn or cosmetically flawed to be eligible for resale through Nike Refurbished. A number of different products and tools are used to return them to as close to new condition as possible, according to Nike.
“Once the shoes land back in a Nike store, the price is based on footwear type and condition grade,” Nike said in an announcement about the Refurbished program.
“Handy messaging on the boxes make[s] it easy to see what kind of shoes are inside, the condition grade, and more. With a simple scan of the box’s QR code, customers can check out even more information about Nike Move to Zero.”
Move to Zero is an initiative to reduce Nike’s carbon and waste footprint. The brand is currently working towards a goal of increasing the amount of post-consumer waste collected and recycled or donated by tenfold by 2025.