Walmart’s latest move to build more fashion cred: The resale market
The discount retailer is now selling 750,000 items from ThredUp to bolster its fashion cred.
Walmart has been trying for years to establish itself as a fashion destination that can offer more than cheap basics—with some success—and now it is looking to ride the resale craze to speed those efforts up.
The retailer said on Wednesday it had begun selling women’s and children’s clothing, accessories, footwear, and handbags from ThredUp, a leading resale site, on Walmart.com, offering an assortment of some 750,000 secondhand items that will be listed on ThredUp’s site as well. To sell on ThredUp, people can send in items that are in good condition. If they are up to standard and then sold, the seller gets a cut of the sale.
In the past few years, Walmart has added as much fashion as it could, moving beyond $3 camis, hoping to compete with Target, whose inexpensive but trendy clothing has been a big draw for shoppers and boosted profit margins, and Amazon, a growing force in fashion.
“This partnership is our latest move to establish Walmart.com as a destination for fashion and offer customers the pre-owned items they might be looking for,” said Denise Incandela, a former Saks Fifth Avenue executive who has led Walmart U.S. e-commerce’s fashion business since 2017.
Walmart’s efforts have included buying brands such as ModCloth, which it quickly resold, menswear label Bonobos, outdoors brand Moosejaw, and women’s plus-size apparel maker Eloquii. Walmart also recently revived Scoop, a fashionable New York City brand. In 2018, Walmart relaunched four store brands and even held an event for them on the margins of New York’s fashion week.
The ThredUp tie-up not only allows Walmart to get in on one of the fastest areas of apparel retail—a 2019 report by research firm GlobalData estimated U.S. sales of secondhand items will more than triple from 2019 levels to $23 billion in 2023—but it also enables Walmart to bolster its assortment of better brands like Coach, which it can only sell indirectly.
An earlier effort to do so by hosting a site on Walmart.com for venerable department store Lord & Taylor met with little success, and now that retailer is reportedly heading toward liquidation.
On top of the higher margins clothing offers retailers, more fashion options attract more of the middle-class shoppers Walmart covets. And Walmart’s online boom has been fueled by online grocery orders, with a pandemic-related surge since March, leading CEO Doug McMillon to say he wants general merchandise sales to do better as he looks to make Walmart’s e-commerce operation profitable.
For ThredUp, teaming up with Walmart is a way to get in front of a much larger audience: According to analytics firm SimilarWeb, Walmart.com had 454 million visits last month, though that was unusually high because of pandemic-related stocking-up shopping that month.
This is ThredUp’s first online partnership with another retailer. It has set up small spaces in department stores J.C. Penney and Macy’s, but those are in-store only and only at a few stores. And in February, ThredUp started allowing Gap Inc. customers to turn in clothing in exchange for a store credit at Gap and Athleta stores, though not at Old Navy.
While Walmart will take the orders, ThredUp will handle shipping items to customers, who will get free shipping for orders of $35 or more, the same policy Walmart offers on anything bought on its site. Shoppers can also return ThredUp items to Walmart stores, but potential sellers cannot drop off clothes they want to sell on ThredUp at a Walmart store.
The partnership also enables ThredUp to further stand out from the growing resale crowd, with more brick-and-mortar options for either shopping or making returns. Larger rival Poshmark is a marketplace where buyers and sellers interact directly, while the RealReal, also bigger than ThredUp, focuses purely on luxury consignment.
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