In recent years, bankruptcy, closure and withdrawal are no longer new to companies. Many of the good times have become a thing of the past in today's market environment. Recently, another leading US e-commerce platform announced a major withdrawal.
The US version of "Xianyu" cuts off three international markets to survive
Recently, Poshmark, an American second-hand e-commerce platform , announced that it will close its business in three markets, India, Australia and the United Kingdom, and shift its focus back to its core market - North America .
Manish Chandra, founder and CEO of Poshmark, said in an open letter that the shutdown process in the three markets of India, Australia and the United Kingdom will officially start on October 26. Buyers can return goods before October 26, and sellers must withdraw the balance on their accounts before November 1. On November 2, local buyers and sellers will no longer be able to access the Poshmark app or website.
Has the glory of the American version of “Xianyu” come to an abrupt end?
In 2011, Poshmark was born in the United States, and it entered the American e-commerce market by focusing on second-hand transactions. In the years that followed, as second-hand transactions became more and more popular, Poshmark entered the vision of capital.
In 2016, Poshmark completed another round of financing of US$25 million, led by GGV Capital .
In 2017, Temasek, GGV Capital, and Mayfield brought another $87.5 million in Series D funding to Poshmark . After five rounds of financing , Poshmark received a total of $178 million from investors .
In 2019 , Poshmark began to expand beyond the United States, with Canada as the first stop for its global expansion. Since then, Poshmark has been very successful in the two major markets in North America.
In 2021, Poshmark was listed on the Nasdaq in the United States . In the same year, it expanded its target markets to Australia and India.
In 2023, Poshmark opened up to the UK market. But just over half a year after entering the market, Poshmark turned around and retreated.
But in fact, Poshmark has been on the decline since its listing. In 2021, Poshmark's stock price fell below the IPO price on its first day of listing, and soared 142% all the way, reaching a market value of US$7.3 billion at its peak . Unexpectedly , its development has been unsuccessful since then, and in 2022 it was even acquired by the Korean giant Naver for a mere US$ 1.2 billion .
In the past, there were many success stories of Poshmark sellers in the market , such as a stay-at-home mom selling second-hand clothes to buy a house in California, and a student making money on Poshmark to finish college ...
It was indeed once an e-commerce platform at the top. Data shows that as of September 2020, Poshmark has sold 200 million items, has more than 80 million consumer customers, 6.2 million active buyers , and 4.5 million active sellers .
The scale is indeed not small, which may have provided confidence for its entry into the three major markets of India, Australia and the United Kingdom. However, contrary to expectations, the monthly active users in these three markets have continued to decline since the expansion .
SensorTower data shows that Poshmark APP has approximately 8.1 million monthly active users worldwide, but as of October, it had less than 500,000 active users in the UK, India and Australia .
Poshmark had to withdraw urgently due to poor performance in markets outside North America, and put its focus back on the two core North American markets. After all, competitors in these two markets are coming on strong, and Poshmark 's market share in the United States is difficult to maintain.
Fierce competition among giants to divide up North American second-hand e-commerce
Several years ago, North America, which emphasizes environmentally friendly consumption, has been swept by the "second-hand trend". In this trend, The RealReal , Poshmask , and ThredUp have successively gone public and used capital support to share the second-hand e-commerce pie in the United States.
ThredUp is a leading second-hand fashion e-commerce platform in the United States founded in 2009. According to the latest second-quarter financial report, ThredUp 's revenue increased by 8% compared to the first quarter of 2023 .
It is reported that from its establishment in 2009 to 2020 , ThredUp has sold as many as 100 categories, 35,000 brands, and more than 100 million second-hand goods. As of the end of December 2020, ThredUp has accumulated 1.24 million active buyers and 430,000 active sellers .
In 2020 alone , ThredUp sold nearly 4 million pieces of second-hand clothing , and in the same year, its revenue profit reached $128 million .
In 2021, ThredUp announced its IPO, and on the first day of ringing the bell, its stock price soared 41%, and its market value reached US$1.3 billion.
In 2022 , ThredUp 's revenue in the fourth quarter alone reached US$72.9 million, a year-on-year increase of 68% , setting a record high ; the number of active buyers reached a record 1.7 million , and the number of orders also reached 1.7 million, a year-on-year increase of 36% and 69% respectively.
In addition, ThredUp's annual revenue in 2022 reached US$ 252 million , a year-on-year increase of 35% , a gross profit margin of 70.7%, and a gross profit increase of 39% year-on-year ; annual orders reached 5.3 million, a year-on-year increase of 34%, also setting a new record .
In the past second quarter earnings conference call, ThredUp CEO James Reinhart stated that since its listing in 2021, ThredUp has now exceeded earnings expectations every quarter and is confident about profitability in the second half of this year .
When it comes to second-hand e-commerce platforms, eBay must be on the list.
eBay started out as a C2C auction and had a stable market share early on. However, with the continuous impact of local e-commerce giants such as Amazon and Walmart, as well as the competition from a number of foreign e-commerce rivals, eBay 's market share has continued to decline, and sellers and buyers have continued to leave .
To this end, eBay has refocused on its core business - second-hand product sales. It spends $100 million a year to build authentic authentication services , launches a "brand authentication" program in partnership with luxury brands , acquires artificial intelligence-driven fashion authentication provider Certilogo , and expands investment in markets such as collectibles ... These are all eBay's efforts to return to the second-hand market.
The effort paid off: eBay reported a $4.6 billion positive economic impact in 2022 from sales of used and refurbished goods .
In the second quarter of this year, eBay's performance exceeded expectations again. Specifically , in the second quarter , eBay 's revenue increased by 5% year-on-year to US$2.5 billion , GMV reached US$18.2 billion , and net profit reached US$172 million .
With spending exceeding $170 billion, the U.S. second-hand market is a "fat piece of meat"
The second-hand e-commerce market in the United States must have great potential, otherwise Poshmark would not have cut three markets and shifted its focus back to the United States, and eBay would not have returned to the second-hand track and achieved continuous revenue news.
In the " 2023 US Second-Hand Market Report" released by Mercari and GlobalData , second-hand shopping has become one of the fastest growing shopping channels in the United States.
In 2022, U.S. consumer spending on secondhand goods reached $174.1 billion, up nearly 8.6% year-over-year. The forecast growth rate of the resale market is 87% from 2022 to 2031, 2.4 times the forecast growth rate of the retail industry (excluding the secondhand goods market). By 2031, this market is expected to reach $325 billion.
In the past 12 months , 81.7% of Americans have purchased at least one second-hand item, equivalent to 212.1 million people, a significant increase year-on-year. Among them, 89.3% of millennials have purchased at least one second-hand item in the past 12 months, the highest proportion among all age groups.
Online shopping is the fastest growing channel for second-hand goods sales in the U.S. In 2022, online second-hand goods sales increased by 15.1%, while offline channels only increased by 4.1%.
Currently, online channel sales account for 43% of the second-hand market. By 2031, this channel is expected to grow by 141% and reach a market share of 55.6%.
The survey shows that in the next 12 months, nearly 90% of American consumers said they might buy second-hand goods, and 56.3% would buy them through online channels.
Not only in the United States, but also in Europe, the size of the second-hand e-commerce market is growing. In 2021, the size of the European second-hand e-commerce market reached 75 billion euros, and it is expected to reach 120 billion euros by 2025. High inflation continues in Europe and the United States, and global geopolitical conflicts have recently erupted one after another, which has had a certain negative impact on consumers' purchasing power. The second-hand market will usher in a new turning point in development. E-commerce retreat |
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