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Despite ongoing efforts across the fashion industry, meeting U.N. sustainability goals remains challenging. The sector continues to be one of the top global producers of greenhouse gas. The industry also uses and pollutes more water than most others — especially in the manufacturing of denim.
But Andy Ruben, former chief sustainability officer at Walmart and the founder and chief executive officer of Trove, a certified B Corp, sees the emergence of recommerce as a solution to move the needle on addressing these issues. Here, Ruben shares his perspective on the challenges facing the industry and how recommerce can create a more sustainable industry as well as how Trove, which counts Levi Strauss & Co., Eileen Fisher and Patagonia among its clients, can help.
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WWD: Why is it so challenging for the fashion industry to meet ESG goals?
Andy Ruben: Economic growth in the fashion industry today is directly tied to selling new items and, thereby, tied to increased production. The average U.S. consumer bought 64 items last year, versus just 12 in the 1980s. While we have made progress at the item level (through better pattern cutting and the use of less toxic dyes, for example), there is no amount of math that will make these “less bad” products offset the impact of the 100 billion items (and counting) we produce each year for 8 billion humans.
We need better, more innovative business models, where economic growth is not directly tied to increased emissions. One new model is resale as a channel, which gives brands the ability to sell a quality item multiple times and, so, monetizes the full value of the item, not just its first sale.
WWD: What’s holding the industry back from greater circularity?
A.R.: Circularity in any meaningful sense is a business model change — it’s innovation — and innovating is never easy. It requires understanding, commitment and resources. Brands and multibrand retailers are overwhelmed by today’s challenges, but they have to innovate in response to massive customer shifts. Consumers today are looking for resale options. The brands that figure out a way to place a few bets on the future by investing in resale as a channel will reap the rewards.
Recommerce today closely resembles e-commerce in the 2000s. Back then, people were asking the same questions as they are today. The launch of e-commerce prompted a shift in how consumers shopped and it required brands to adopt new technologies, partners and processes. It became a channel, just like resale has become today. And those who moved early in e-commerce and realized it was a channel gained the greatest rewards. The same will be true with resale as a channel.
WWD: What role does recommerce play in a more sustainable fashion apparel market?
A.R.: When done right with quality products, recommerce allows greater use of garments that have already been produced. The greater use of these items means there’s less reason for lesser-quality items to be made, shipped and sold. Recommerce helps displace new products and reduce greenhouse gas emissions.
It’s the biggest retrofit currently available to retail brands that enables them to grow their businesses without growing their carbon emissions. Established brands have millions of items that are sitting in their customers’ closets and not being used. Every one of those is an opportunity for customer engagement, new customer acquisition and brand building.
Recommerce is also meeting customers where they want brands to be. Consumer survey data shows that 65 percent of consumers, across generations, want to experience resale directly with the brands.
WWD: What are some of the consumer trends driving resale?
A.R.: According to recent research from the Wharton School at the University of Pennsylvania, resale sales are up, and the stigma about the channel is down. Since 2019, secondhand apparel shopping has increased by at least 30 percent and by as much as 55 percent by generation. Baby Boomers are also driving resale. While only 52 percent of Baby Boomers participated in recommerce in 2019, that figure has jumped to 81 percent today.
Sustainability itself is a drive. More than 50 percent of consumers who shop resale do so for sustainability reasons, such as concern for the planet or a preference for circular shopping. And price is also a driver. Gen Zers are very price-conscious and survey data indicates that 30 percent of these younger shoppers are driven by price.
WWD: How does Trove work?
A.R.: Trove powers the technology, operations and analytics that enable retailers to establish a scalable and profitable branded recommerce channel. Over the last 10 years, we have built proprietary technology that enables customer trade-in of items, single-sku identification and condition grading of items, recommerce site build and maintenance, and customer data collection, analytics and reporting. We are 100 percent white label, as we believe the resale channel must be part of the brand over the long term.
We handle all of this behind the scenes to make sure brands’ resale channels look and feel exactly like their other brand touchpoints and experiences, without the brands having to invest the resources and capital to build the channel themselves.
WWD: And what is the value proposition for brands?
A.R.: Much like 20 years ago, when e-commerce was emerging as a channel, resale is becoming a channel for brands today. It can’t be effectively outsourced to a third-party marketplace because brands need a path to scale and their resale businesses need to integrate completely with their full brand.
Achieving this at scale requires new technology, logistics and best practices. That’s where Trove comes in. We provide the technology that allows brands to start and grow their resale channel at scale and fully integrate it with every other touchpoint of their brand.
We’ve moved millions of pre-owned items for the world’s best brands and they have found incredible benefit in monetizing their products throughout those items’ useful lives, rather than allowing all future sales to exist on third-party marketplaces. Our partners find significant additional revenue, at good margins, and, more importantly, they’re able to take back their customer relationships and data to compete with marketplaces that are using their brand name to build a business.
WWD: What are some of the brands Trove has partnered with and what were the outcomes?
A.R.: Patagonia: Just three years after launching its resale program, Patagonia now owns more than 50 percent of its secondary market business, more than all other third-party marketplaces combined. And 65 percent of the brand’s customers who have bought pre-owned items had never bought from Patagonia before.
Lululemon: Lululemon recently rolled out in-store trade-in to all of its 390 stores across the 50 states. It has been an incredible program for guests, as Lululemon makes it so easy for them to simply bring items they no longer wear back to their local store for a gift card. The items are processed and sold on lululemon.com.
REI: REI has made trade-in and resale a core part of its co-op membership program. REI customers can bring back any branded gear to their local co-op in exchange for what they need now. It’s an incredible example of a brand with circularity at the core and it’s the future of what great retailers stand for.