Thrifted clothes have become an unlikely fashion flex for Hollywood’s haute couture hoarders and other trend-setters.
California companies have propelled this movement, turning what was once an old-fashioned way to save money into a booming industry at the cutting edge of style.
The secondhand clothing market grew 20% to more than $240 billion over the last five years, according to McKinsey & Co.’s State of Fashion report, as San Francisco’s RealReal, Redwood City’s Poshmark, Oakland’s ThredUp and others used Silicon Valley innovation to streamline listing, finding and delivering secondhand products.
“Resale itself reflects something very Californian: taking an existing behavior and using technology to fundamentally change its scale and possibilities,” said Rati Sahi Levesque, founder of the RealReal. “What we’ve done is build the trust, logistics, data and technology that allow that behavior to become a mainstream way millions of people shop.”
The emergence of a new kind of online shopper, using these sites and willing to pay luxury prices for used pieces, has become so prominent that it is sometimes outshining the freshest runway trends.
California consumers’ acceptance of and excitement about thrifted, recycled and repurposed clothes catapulted L.A.’s Reformation from a vintage boutique into a billion-dollar company after its initial public offering last month.
Online thrifters like that they save money, help reduce waste and can ignore trends dictated by the industry. Many also are addicted to the thrill of the hunt for rare, unique items at a better price.
USC student Julia Ho had been scouring all the sites for months for a particular 1990s Gucci watch she was obsessed with. She tracked it down at a great price on the old-school online marketplace from San José’s EBay.
She clicked immediately, and it arrived three weeks later in great condition.
“There’s definitely a dopamine hit when you’re looking for these deals” and you find what you are looking for, she said.
The used fashion boom has been growing for years, driven by technology developed by companies around the San Francisco Bay Area. The clothing resale companies, all founded within 50 miles of one another in the Bay Area, have turned the fashion industry on its head.
Trailblazers like Craigslist and EBay showed the potential of online listings of anything. Fashion specialists tried to add more ways to transact, giving sellers more checks and balances and adding delivery and payment methods to help buyers feel safe.
The fashion industry turbocharged the trend with limited-edition drops from brands like Nike and Supreme, meaning the only way to get your hands on an Air Max shoe or T-shirt collaboration was through a resale site at astronomical markups.
A whole social media ecosystem emerged with influencers sharing their finds and recommendations. On YouTube, L.A.-based influencer Emma Chamberlain’s thrift store hauls went viral. Other creators gained a following by turning thrift-store finds into trendy items.
When the COVID-19 pandemic hit, secondhand shopping sites took off. People were looking to empty out their closets and make extra cash. Reselling became a side hustle for many and a full-time job for some.
When ThredUp Chief Executive James Reinhart founded the company in 2009, he hoped to change the secondhand fashion market by giving people a place to easily send in used clothing and browse millions of sorted, listed items.
At the time, resale brought to mind old, dusty clothes in the back of a closet and rummaging through thrift store racks just to put on someone else’s shoes.
“It was something that required a level of coercion,” Reinhart said. “It was, ‘You should do this. It’s good for you. It’s good for your wallet. It’s good for the planet.’”
In 2011, two other sites emerged: Poshmark, with a peer-to-peer marketplace, and the RealReal, focused on luxury items and authentication services. By 2021, the companies had gone public, though South Korean tech giant Naver Corp. bought out Poshmark two years later for $1.2 billion.
EBay has been investing more in fashion resale and authentication services. In July, it acquired Depop, a trendy secondhand fashion platform based in London, for $1.2 billion.
According to the McKinsey report, secondhand shopping is growing at four times the speed of retail, at around 12% per year.
Traditional retail shopping is boring, Reinhart said. Many stores carry iterations of the same styles, and in the wake of fast fashion, buying vintage clothing is the easiest way to be sure that what you’re wearing is different.
“Now when generations are coming of age, there’s no stigma, there’s nothing odd about shopping at a thrift store or shopping secondhand,” Reinhart said. “If anything, it’s the other way, which is it’s the cool thing that kids want to do.”
With fashion icons increasingly touting their thrift finds on social media and industry events, old-fashioned has become fashionable.
“I Love LA” actress Odessa A’zion presented at the Emmy Awards this month in a 1996 Jean Paul Gaultier suit, landing her on best-dressed lists.
“For decades, the industry has been organized around newness: the new season, the new collection, what you should want now,” the RealReal’s Levesque said. “Resale breaks that linear relationship with fashion. A Phoebe Philo-era Chloé bag can be as relevant as something that walked the runway six months ago. A 20-year-old piece can become exactly what a 22-year-old is searching for.”
To be sure, the California companies benefiting most from the movement still need to find more ways to reduce costs if they want to keep growing and boost their profit margins, said Anita Balchandani, a senior partner at McKinsey.
Resale is still in its “gangly teenager” phase, she said. “The economic model is tough. They’re operationally complex, and the rate of return is quite low.”
RealReal shares have fallen more than 35% this year. ThredUp shares are down more than 60% over the same period, plunging after investors were disappointed with its revenue outlook announced last month.
The companies are turning to artificial intelligence to cut costs.
At ThredUp, AI helps sort the millions of pieces of clothing sent into warehouses, helping speed up operations and reduce costs.
This year, the RealReal introduced an AI feature called MyCloset that lets users track the value of all their clothing.
In June, Poshmark announced a partnership with Venice-based AI shopping assistant platform Silvr to upload more than a hundred million of its listings so users can search for outfits.
The companies are betting that as the next generation of fashion enthusiasts comes of age, an even larger wedge of their wallets will go to secondhand fashion.
“I think about them as resale natives,” Reinhart said. “They do not know any other world than a world for which buying and selling secondhand was very normal.”
The post How California tech turned thrifted clothes into a booming fashion trend appeared first on Los Angeles Times.
