October 14, 2015
Will second-hand clothing drive more traffic to Target’s stores?
Target, which made its name from cheap chic apparel, is looking to bring its business to another level with … secondhand clothes?
The chain is working with thredUP, a service that buys name brand secondhand clothing from consumers. Consumers will send their clothing to the Target page on thredUP in exchange for gift cards that they can use in the retailer’s stores or on target.com. The purpose is to drive more consumers to Target and build purchases that go beyond what’s covered by the gift cards.
Consumers who are interested in getting rid of their used clothing can go online to thredUP and request a "clean out kit." After receiving it, they send their clothes to thredUP (Target is picking up the shipping costs) for inspection. Items valued at less than $60 will be paid upfront to the Target shoppers. They will receive their gift cards for more expensive items after a sale is made.
![[Image: thredUP]](data:image/svg+xml;base64,PHN2ZyB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciIHZpZXdCb3g9IjAgMCAxIDEiIHdpZHRoPSIxIiBoZWlnaHQ9IjEiIGRhdGEtdT0iJTJGcHVibGljJTJGaW1hZ2VzJTJGZGlzY3Vzc2lvbnMlMkYxODYwMSUyRnRocmVkdXAtc3RpbGwuanBnIiBkYXRhLXc9IjEiIGRhdGEtaD0iMSIgZGF0YS1iaXA9IiI+PC9zdmc+)
As of now, 11 Target stores in the Twin Cities area are also acting as drop-offs for thredUP packages. Reports did not indicate if the retailer plans to expand to other locations across the country.
ThredUP, which currently focuses on women’s and children’s clothing, raised $81 million in Series E funding last month.
"We founded thredUP to make it incredibly convenient for consumers to clean out their closets and shop for quality secondhand clothes," James Reinhart, CEO and co-founder of thredUP, said in a press release to announce the funding. "We saw a huge opportunity to leverage Internet penetration and the growing acceptance of buying and selling online to bring a delightful, frictionless secondhand experience to the masses."
BrainTrust
Zel Bianco
President, founder and CEO Interactive Edge
Kenneth Leung
Retail and Customer Experience Expert
Recent Discussions
Discussion Questions
Do you see a growing market for second-hand clothing at major retail apparel chains? Will the Target/thredUP partnership drive more traffic to the retailer’s stores and website?
Poll
If I’m understanding George’s article (and please correct me if I’m wrong), this sounds like a partnership that will make more merchandise available to thredUP through Target’s reach. It doesn’t appear that Target itself will be selling these “gently used” goods in its own stores … at least I hope not. That sort of idea would be seriously off-message for Target, and frankly I’m having trouble seeing the benefit of this program in the first place.
This is right on trend for thrifty Millennials who freely swap and sell clothing. Does it drive sales or perception? Probably the latter, but what an interesting way to grab attention for two seemingly different types of stores both courting the same customer.
While I do see an opportunity for retailers such as Target, Walmart and other retailers, I am not sure it would be the right move for the likes of Belk, Macy’s and other fine department stores. It does bring in Goodwill shops and the Salvation Army stores as new competition but it is a growing market.
The Target/thredUP partnership will be a short window of opportunity as the second-hand market grows and creates more traffic to all retailers in the space. The real question is: Is it its own category or just an expansion of the current categories?
I can’t see people buying second-hand clothing at major retail chains but, unless I am missing something, that doesn’t seem to be the plan for Target. Offering Target specific gift cards is a great way to ensure that when shoppers are done cleaning out their closets they will refill them with Target items. This is also a great, natural way to get involved in the eco-friendly movement of second-hand clothing.
The thredUP program came to my attention by way of my Millennial daughter. She took advantage of this program as soon as it came to light. A Target gift card is a strong motivator to clear out a closet. Given the enthusiastic involvement I observed in my daughter’s embracing this program, I believe the second-hand (slightly-used) clothing market should be explored by retailers.
These programs will definitely drive more traffic to brick-and-mortar stores for delivering clothing as well as redeeming those gift cards.
I believe thredUP could leverage this program further if they provided a component for charitable donations. There are plenty of folks that could use the clothing that doesn’t recycle in a commercial manner.
Millennials are very concerned about sustainability. This concept is essentially “recycling” clothes that still have use. the image of Target will enhance the value of these used garments. Once Millennials come to grips with the social cost of “fast fashion” we will see a massive change in the retail landscape. Well done, Target
Weird partnership. I look for it to die quickly. There is a lot more to buying and selling used clothing. I am wondering why Target is letting itself get distracted. A lot more downside than upside.
With the growth of fast-fashion retailing, designer-inspired clothing at reasonable cost, why buy used when buying new is so affordable? I can see a used clothing market for high-fashion, designer clothes, but not for the kind of product found at Target. These items will probably find their way to Goodwill stores.
What traffic is it driving to the stores? Is it the traffic that will say “while I am here let me look for something else?” I doubt it. I am not sure the traffic will be noticeable nor will the sales dollars. Isn’t that what it is all about?
Judging from my wife and her friends, around our community “My Sister’s Closet” is a weekly destination for high-end consignment clothing. The only complaint is that they are very fussy about what second hand clothing they take on consignment, much fussier than those looking to buy the stuff. To my chagrin, it looks like Target/threadUP is making the process much easier.
There’s got to be a way to stop them!
I read recently that Neiman Marcus is doing something like this with their customers. Customers can return their previously bought and gently used merchandise for Neiman Marcus credits.
This is a super cool trend and not just for Millennials, but also for those fashionistas who buy new each season.
For my 2 cents.
Second-hand clothing—environmental sensitivity? Yes, perhaps…BUT perhaps more economic necessity? Based on a simple InfoUSA survey of telephone listings for those whose primary customers are economically challenged, since 2001, these businesses have nearly doubled, including furniture rental, pawn brokers, thrift stores, check cashing, payday loans, title loans, going from 44,509 in 2001 to 81,780 in 2015. Does this say something about the “vanishing middle class” and the stagnation and loss in income by many Americans?
So Target’s move may simply be a recognition of this trend. By the way, if one adds the three primary dollar stores, they have expanded from 8,130 to 25,504.
The migration from purchasing used in place of new apparel seems parallel with the disappearance of the American middle class citizen. Thrift stores are popping up everywhere and the profit taking is climbing. Meanwhile the past traditional retail clothiers continue to struggle. Most of this struggle is the woeful feelings of being forced to give in and finding a face saving method of participation.
Sanitizing, sorting, disposal of non merchantable used goods, labeling and handling costs will make for a considerable consumption of margins. A better way to kindle a wider consumer base interest in high-end apparel may be seen through the marketing plan of the special events aspect of the rental industry. Handling this as a separate brand or even department within the store would be more acceptable to people that are slow to see the value of change.
I think it’s a really smart test. So much going on with this that’s spot on: consumers have too much stuff, said stuff turns into a gift card vs just giveaway and of course, young people love to shop thrift. Win-win-win.
Let’s hope we get a follow up report as to whether or not it actually works. But in the meantime, with three daughters, I sure wish they’d test it here!
I think that spending time on the thredUP website will answer many of the questions commenters here have. First of all the “proceeds” apparently will be paid in Target vouchers to be spent at Target stores—hence the potential for increased traffic. Also, it appears they plan to be very, very picky both in terms of the brands they accept and the condition of the garments.
I think this program has a chance to succeed but execution, as always, will be key. It’s likely that buyers will be happy with the brand name discounts. But if the clean-out-the-closet providers of the used merchandise do not feel they are getting a fair shake and word gets around, it will be the kiss of death for this idea.
Sounds like a partnership using Target’s brick and mortar space as a fulfillment center for the used clothes and compensating via Target gift cards. It does help drive traffic to the stores just like Coinstar drives traffic to grocery stores. I don’t see Target getting into second hand clothing business because that’s a different model and requires much more in-store curation to make it work per the location.
More Discussions
How Timely Is the Planned Lowe’s Website Renovation Focusing on Personalization?
Is Lowe’s being timely with its website reno, and is it right to be placed as…Should Costco Be Opening Members-Only Gas Stations?
Is this the right move for the warehouse club?As Boomers ‘Age Out of Peak Purchasing,’ How Can National Brands Retain Interest With Gen Z?
According to a recent First Insight study titled “Is Gen Z Still Choosing Your Brand,” while…
If I’m understanding George’s article (and please correct me if I’m wrong), this sounds like a partnership that will make more merchandise available to thredUP through Target’s reach. It doesn’t appear that Target itself will be selling these “gently used” goods in its own stores … at least I hope not. That sort of idea would be seriously off-message for Target, and frankly I’m having trouble seeing the benefit of this program in the first place.
This is right on trend for thrifty Millennials who freely swap and sell clothing. Does it drive sales or perception? Probably the latter, but what an interesting way to grab attention for two seemingly different types of stores both courting the same customer.
While I do see an opportunity for retailers such as Target, Walmart and other retailers, I am not sure it would be the right move for the likes of Belk, Macy’s and other fine department stores. It does bring in Goodwill shops and the Salvation Army stores as new competition but it is a growing market.
The Target/thredUP partnership will be a short window of opportunity as the second-hand market grows and creates more traffic to all retailers in the space. The real question is: Is it its own category or just an expansion of the current categories?
I can’t see people buying second-hand clothing at major retail chains but, unless I am missing something, that doesn’t seem to be the plan for Target. Offering Target specific gift cards is a great way to ensure that when shoppers are done cleaning out their closets they will refill them with Target items. This is also a great, natural way to get involved in the eco-friendly movement of second-hand clothing.
The thredUP program came to my attention by way of my Millennial daughter. She took advantage of this program as soon as it came to light. A Target gift card is a strong motivator to clear out a closet. Given the enthusiastic involvement I observed in my daughter’s embracing this program, I believe the second-hand (slightly-used) clothing market should be explored by retailers.
These programs will definitely drive more traffic to brick-and-mortar stores for delivering clothing as well as redeeming those gift cards.
I believe thredUP could leverage this program further if they provided a component for charitable donations. There are plenty of folks that could use the clothing that doesn’t recycle in a commercial manner.
Millennials are very concerned about sustainability. This concept is essentially “recycling” clothes that still have use. the image of Target will enhance the value of these used garments. Once Millennials come to grips with the social cost of “fast fashion” we will see a massive change in the retail landscape. Well done, Target
Weird partnership. I look for it to die quickly. There is a lot more to buying and selling used clothing. I am wondering why Target is letting itself get distracted. A lot more downside than upside.
With the growth of fast-fashion retailing, designer-inspired clothing at reasonable cost, why buy used when buying new is so affordable? I can see a used clothing market for high-fashion, designer clothes, but not for the kind of product found at Target. These items will probably find their way to Goodwill stores.
What traffic is it driving to the stores? Is it the traffic that will say “while I am here let me look for something else?” I doubt it. I am not sure the traffic will be noticeable nor will the sales dollars. Isn’t that what it is all about?
Judging from my wife and her friends, around our community “My Sister’s Closet” is a weekly destination for high-end consignment clothing. The only complaint is that they are very fussy about what second hand clothing they take on consignment, much fussier than those looking to buy the stuff. To my chagrin, it looks like Target/threadUP is making the process much easier.
There’s got to be a way to stop them!
I read recently that Neiman Marcus is doing something like this with their customers. Customers can return their previously bought and gently used merchandise for Neiman Marcus credits.
This is a super cool trend and not just for Millennials, but also for those fashionistas who buy new each season.
For my 2 cents.
Second-hand clothing—environmental sensitivity? Yes, perhaps…BUT perhaps more economic necessity? Based on a simple InfoUSA survey of telephone listings for those whose primary customers are economically challenged, since 2001, these businesses have nearly doubled, including furniture rental, pawn brokers, thrift stores, check cashing, payday loans, title loans, going from 44,509 in 2001 to 81,780 in 2015. Does this say something about the “vanishing middle class” and the stagnation and loss in income by many Americans?
So Target’s move may simply be a recognition of this trend. By the way, if one adds the three primary dollar stores, they have expanded from 8,130 to 25,504.
The migration from purchasing used in place of new apparel seems parallel with the disappearance of the American middle class citizen. Thrift stores are popping up everywhere and the profit taking is climbing. Meanwhile the past traditional retail clothiers continue to struggle. Most of this struggle is the woeful feelings of being forced to give in and finding a face saving method of participation.
Sanitizing, sorting, disposal of non merchantable used goods, labeling and handling costs will make for a considerable consumption of margins. A better way to kindle a wider consumer base interest in high-end apparel may be seen through the marketing plan of the special events aspect of the rental industry. Handling this as a separate brand or even department within the store would be more acceptable to people that are slow to see the value of change.
I think it’s a really smart test. So much going on with this that’s spot on: consumers have too much stuff, said stuff turns into a gift card vs just giveaway and of course, young people love to shop thrift. Win-win-win.
Let’s hope we get a follow up report as to whether or not it actually works. But in the meantime, with three daughters, I sure wish they’d test it here!
I think that spending time on the thredUP website will answer many of the questions commenters here have. First of all the “proceeds” apparently will be paid in Target vouchers to be spent at Target stores—hence the potential for increased traffic. Also, it appears they plan to be very, very picky both in terms of the brands they accept and the condition of the garments.
I think this program has a chance to succeed but execution, as always, will be key. It’s likely that buyers will be happy with the brand name discounts. But if the clean-out-the-closet providers of the used merchandise do not feel they are getting a fair shake and word gets around, it will be the kiss of death for this idea.
Sounds like a partnership using Target’s brick and mortar space as a fulfillment center for the used clothes and compensating via Target gift cards. It does help drive traffic to the stores just like Coinstar drives traffic to grocery stores. I don’t see Target getting into second hand clothing business because that’s a different model and requires much more in-store curation to make it work per the location.