The Outside View: With Resale Growing Fast, Why Are So Many Brands Handing Their Customers to Third-Party Marketplaces?

Way back in 2001, when I was leading strategy for Walmart, a well-respected retail executive told me that e-commerce was “nothing more than a mail order catalogue on a screen.” Those catalogues never made up more than 3 percent to 5 percent of retail sales, he went on to explain, and neither would e-commerce. Obviously, his prediction was…a little off. E-commerce continues to massively disrupt retail and its share of sales has only accelerated since the start of the pandemic. But even two decades ago, the fundamental differences between e-commerce and print catalogues were apparent. The executive I spoke with, and plenty of other retail leaders, simply missed — or chose to dismiss — them. They had too narrow a view of how a new shopping channel and behavior would change the industry and what they should do to take advantage of the opportunity in front of them. Today, many in the industry are making a similar mistake with resale — because there will be a day in the not-too-distant future when resale will account for one in four items sold, and possibly more in some categories. According to Cowen, recommerce will account for 14 percent of clothing, footwear and accessories sales by 2024.

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