Although it is sense to assume that those looking for deals would dominate the used market, this is what occurs when assumptions are made. According to thredUP’s Q1 2023 financial report, luxury consumers, not bargain hunters, are driving the industry.
The CEO and co-founder of thredUP, James Reinhart, claims that customer behavior has changed, with more premium shoppers showing interest while value shoppers are losing interest. The average order value of customers in the budget category has decreased by 24%, while that of upscale consumers has increased by 6%, demonstrating this pattern.
The report’s findings come after the release of thredUP’s 11th Annual Resale Report in April, which forecast an almost trebling of the global secondhand market by 2025.
Why Do Premium Shoppers Choose thredUP?
Premium buyers, not luxury shoppers, are more likely to stay loyal to a brand or business than deal chasers, especially as inflation continues to damage consumer finances.
Furthermore, over half of deal chasers say their earnings have stayed unchanged or decreased in the last year. While both deal hunters and persuadable consumers have seen comparable decreases in buying power as a result of inflation, deal hunters have a bleaker prognosis on the length of the continuously high inflation, forecasting it to last until almost the end of 2024.