Goodwill Hunting #06: how aggregation theory applies to resale fashion
Goodwill Hunting curates pre-loved fashion finds from across the web
Aggregation Theory is at play in secondhand fashion.
In 2015 (and later, 2017), Ben Thompson penned Aggregation Theory on Stratechery. Thompson describes how platforms (e.g., aggregators) gain market share in “a systematic and predictable way.”
Looking back over the last 20 years, the internet has fundamentally disrupted the value chain in consumer markets. Pre-internet, suppliers and distributors integrated to control distribution. Consumers had access to constrained supply. Think back to the era of taxi cab medallions (pre-Uber) or cable subscriptions (pre-Netflix).
The internet upended these systems because it made distribution of digital goods free and with low (or even zero) transaction costs. Consumers finally were in the driver's seat. How good (or bad) the user experience was became the determining factor in whether a distributor / aggregator / market-maker is successful (or not). Why does this happen? The flywheel effect: the best user experience drives the most users. More users means more suppliers. More suppliers means more investments in user experience. And so on.
So how does Aggregation Theory apply to secondhand fashion? Resale aggregation relies on resale digitization.
Users must first create digital listings of their physical clothes to sell on resale marketplaces like Poshmark, Depop, Ebay, etc. or get discovered on aggregators of aggregators like GEM. These resale sites have low-to-zero marginal costs because they don’t have standard product COGS, physical distribution, and transaction costs. For example, Poshmark enables the connection between millions of sellers and buyers. The seller manages inventory, photography, pricing, marketing, packaging, and fulfillment. By making it easy to sell, Poshmark increases supply.
But aggregation won’t be enough to make secondhand fashion first choice. Consumers need better discovery and curation, which is why I believe that the future of (re)commerce is curation. Here are the steps towards a more easy, seamless, and delightful resale experience.
Step 1: Digitize our closets (Storey)
Step 4: Discovery & curation (??)
♻️ 3 products
Vintage 1950s emerald earrings from 1stDibs ($119, 20% off)
Vintage Gucci Jackie bag in black leather from Vestiaire Collective ($275)
Vintage Yves Saint Laurent mini dress from The RealReal ($398, 50% off)
📕 3 reads
The Future of Fashion: From design to merchandising, how tech is reshaping the industry (CBInsights). An investigation into how fashion will shape technology and how technology will shape fashion in the next decade—from AR/VR try-on to digital fashion to resale.
Vestiaire Collective buys Tradesy as resale consolidates (Vogue Business). This is old news at this point, but is an important signal in the rapidly accelerating—and consolidating—fashion resale market. Last year, Etsy acquired Gen Z-favorite Depop for $1.625 B.
The Recommerce 100 (ThredUP). ThredUP launched a publicly-available database of branded recommerce sites, such as OG Eileen Fisher’s resale program (65K listings, launched in 2009). ThredUP’s analysis indicates that branded resale has grown 275% YoY across 41 brands and 133K+ listings.
✨ 3 jobs
Aritzia — Product Sustainability Specialist. Partner with supply chain, product, and business teams to improve the sustainability of “Everyday Luxury” brand Aritzia. Dog-friendly office in Vancouver, BC.
DÔEN — Recommerce Senior Project Manager. Live out your cottagecore dreams by leading recommerce strategies and programs for the influencer-favorite brand. Based in LA but position is hybrid 3 days/week in the office.
Gently (formerly known as Wearloom) — Director of Growth. Lead growth at fast-growing startup Gently, which serves 10,000+ shoppers daily in finding the best listings from resale sites like Poshmark, Depop, and eBay. Message me if interested as I may be able to make an introduction.
💡 3 thoughts
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Disclaimer: My posts are my own and do not reflect the opinions of my current, past, or future employers. Goodwill Hunting is not affiliated with Goodwill Industries or the film Good Will Hunting.
100%!! As I've started on the secondhand buying journey, I've been surprised at quite how much effort is involved in discovery, even with all the great marketplaces.