By CultureBanx Team
- Walmart partners with resale marketplace ThredUp to tap into the $32B market
- Among e-commerce apps, 26% of African American adults use Walmart, at a higher rate than the total population
Retail giant Walmart (WMT +0.30%) has found another way to profit during the pandemic with its new strategy of selling second hand clothes. The company has partnered with ThredUp, a resale marketplace for used fashion items like Chanel bags, Michael Kors clothing, Gucci accessories and Nike (NKE +0.37%) shoes, to sell through its e-commerce platform. Among e-commerce apps, 26% of African American adults use Walmart, at a higher rate than the total population, according to Nielsen. Lower-priced brand name goods may resonate with this demographic of Walmart shoppers at a time when millions of Americans are unemployed, or coping with pay cuts, as the company looks to tap into the $32 billion resale market.
Why This Matters: You know it’s a new day when Walmart and trendy online thrift stores join forces, especially if you consider the Bureau of Labor Statistics found that Black people spend around 3% of their household expenditures on clothes, this could be a great way to save some money and stay in style. Not to mention that the resale market is expected to expand from $32 billion this year to $51 billion by 2023, according to research from ThredUp and GlobalData Retail.
Black people spend around 3% of their household expenditures on clothes
ThredUp bills itself as the largest online thrift store and offers more than 750,000 items across 2,000 brands. Customers will get free shipping from Walmart so long as they spend $35 or more, and items can be returned at nearby stores.
Beyond customers closets, is the profit waiting to be made.Walmart can help drive up profitability of its e-commerce business, which has been unprofitable this far. The company’s e-commerce sales grew by 74% in Q1 2020, during the coronavirus pandemic. It’s possible that secondhand fashion items can help the retail giant drive greater returns. Shares of Walmart are up nearly 5% year to date.
Situational Awareness: Thrift stores are no longer viewed as a place where low-income people shop, they attract more middle class consumers in search of vintage and one of a kind items. Walmart is vying for a way to better service this demographic with its e-commerce platform.
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