The Secondhand Market Is Growing Rapidly, Can Challengers Like Vinokilo Thrive And Scale?

Gulnaz K
23 Feb, 2022

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Online secondhand and consignment platforms have been growing in popularity, even before the pandemic arrived. In 2019, this market expanded 21 times faster than conventional apparel commerce did. The COVID-19 pandemic has accelerated the growth even further. According to a recent report by ThredUp, the U.S. secondhand fashion market is expected to more than triple in value in the next 10 years – from US$28 billion in 2019 to US$80 billion in 2029. Early signs of this could be seen in ThredUp Inc. confidentially filing for IPO and Vestiaire Collective, their European rival, raising $64.2 million in fresh funding.

For many consumers buying secondhand fashion is driven by desire to live a more sustainable lifestyle. Choosing pre-owned over new is one step towards circular fashion and an obvious way to extend the lifetime of an item.

Another reason for the sudden interest in secondhand could be traced to the economic uncertainty and the looming crisis triggered by the pandemic. With unemployment numbers and the cost of living on the rise, buying pre-owned fashion could be a way for consumers to treat themselves to a nice dress or a pair of jeans while saving a buck. According to ThredUp’s report, 82% of people have or are open to shopping secondhand when money gets tighter.

While established players have capitalised on this growing trend, a few challengers have emerged. One of them is a German company, Vinokilo. They started as an offline community and a thrift shop before expanding into e-commerce. The company hasn’t raised any outside venture capital to date and has been growing steadily while staying profitable–quite an outlier in the current tech landscape.

How is an up-and-coming offline-first company growing in a highly competitive market without losing what made them unique?

Pop-up event organised by Vinokilo in 2020 @VINOKILO

Prior to the pandemic, live events were a big part of the company's marketing strategy. Regular pop-ups were held across Europe to gather vintage lovers keen on discovering unique secondhand vintage pieces.

With the pandemic and country-wide lockdowns this was no longer a viable strategy. The company had to adapt swiftly and find new ways to engage with customers. In order to ensure the safety of all visitors, they replaced a 1-2 days event pop-up model with a 3-5 day mini-festival in each city–thus keeping the number of attendees within required regulations.

At the same time, the company decided to make e-commerce a more prominent channel by relaunching the website with new branding, multi-language support and leveraging email marketing.

Vinikilo has a distinct vintage focus with the majority of items on the platform being one of a kind. Shoppers come to Vinokilo not just to buy secondhand. They come there to discover treasures, unique gems, and items that might not be easy to find otherwise. One of the challenges that the company had to overcome was moving this engaged community, that was largely built through pop-up events and thrift shops, to e-commerce.

The value of community-driven commerce can not be overstated, and Vinokilo understands it well. Prior to the relaunch of the e-commerce platform, they ran a campaign showcasing “real people, real stories.” Instead of using influencers or celebrities, they used portraits of real shoppers on their platform to show the diversity and real faces of the community.

#THENEWNEW series featuring stories of Vinokilo's community. VINOKILO

For many shoppers in this community, buying pre-owned fashion is a way to live a more sustainable lifestyle. While there have been some positive developments at the industry level towards sustainability, some companies have been caught ‘greenwashing’ their brands as a way of attracting environmentally-conscious consumers without actually changing their practices.

In my conversation with Anisah Osman Britton, the CTO of Vinokilo, she emphasised that for them, sustainability is a way of living in the company and they try to walk the talk in every element of their business. They try to educate and enable their community to take a more active role in sustainability. For example, shoppers can bring items to events for recycling or reselling. They also organise workshops to teach people how to repair clothes and extend their lifetime.

The company also tries to address other aspects: like receiving items in plastic-free packaging, limiting employee travel, or choosing carbon neutral traveling for their team. They recently launched a new sustainability initiative , Vinokilo Circle. It allows customers send unwanted fashion pieces for recycling and upcycling. One of the next items in the company’s sustainability agenda is addressing the high returns that the fashion industry is notorious for.

Osman Britton mentions that the company today has a climate-positive impact: “Studies from an impact assessment agency, Dear Impact have shown that for every 4 items purchased from us we offset 1 newly produced item. Throughout the last year alone we sold 550,000 pieces of clothing. Which accounts for 1,744,232 kg of Co2 emissions saved.”

Looking at Vinokilo, I see a newcomer with large ambitions in this market. But being a German company, trying to build a profitable and sustainable fashion business while selling unique vintage pieces, the question arises: “Can this scale?”

The team seems to have a positive outlook. “We believe what we've worked on so far is a stepping stone towards a circular future where Vinokilo provides secondhand clothes as a service,” says Robin Balser, the founder of Vinokilo. The company’s footprint both in the online and offline worlds could indeed be a strong foundation for its global ambitions. A big role in this is also given to Vinokilo’s customers and the strong and loyal community. Balser explains that it starts with hand-picking each item that goes on sale and ends with personalised customer service ensuring that “we are authentic with our customers.”

Time will tell what place Vinokilo will carve out for itself in this rapidly growing and highly competitive market. What I’m certain about is that the future of fashion can be one where it’s shaped by these kinds of players that are built locally and out of authentic communities. Players that grow their businesses to be sustainable in each aspect of their lives and financially independent.