By Luke Trayfoot, Chief Revenue Officer at MANGOPAY

In 2023, we’ll see prices of goods continue to increase in the UK as rising inflation takes effect. Many consumers are already struggling to afford basic products and becoming increasingly cautious in their spending habits to combat the cost-of-living crisis. In fact, 87% of shoppers globally have admitted they are looking for ways to make purchases more cheaply.

While many retailers are seeing steep declines in sales, The UK Office for National statistics stated that, in October, ‘the sub-sector of other non-food stores reported a monthly rise in sales volumes of 3.6% because of strong growth in second-hand goods stores.’ In turn, this is generating a rise in the use of resale marketplaces and platforms.

Resale marketplaces – often referred to as customer-to-customer (C2C) marketplaces – are an alternative way to buy and sell goods, often at a lower price than available at traditional retailers. They provide a complete shopping experience, usually including fast and reliable payment options, delivery services and more. Today’s economic climate presents marketplaces with the opportunity to act as crucial lifelines for consumers searching for ways to navigate the ongoing impact of inflation.

The low cost of convenience

Typically, pre-loved goods sold on C2C marketplaces are less expensive than brand-new products from the original retailer. While resale stores aren’t new, online C2C marketplaces have their own unique set of benefits setting them apart from other e-commerce players. Marketplaces allow sellers to offer the same products as others on the same platform and set their own prices, enabling them to remain competitive. As a result, consumers can shop around and compare prices, all on a single platform.

In addition, shoppers can purchase items from multiple sellers via a single transaction – eliminating the need to visit multiple e-commerce sites and make several purchases to secure items at a lower price. This means consumers have a single, unified payment journey, creating a more seamless experience.

Marketplaces have complex payment requirements as they need to manage buyers, sellers, and transactions on a local, and potentially global, scale. As payment preferences and regulations vary somewhat from country to country, it’s crucial that marketplaces are constantly innovating to guarantee the best payment experience for their users, whether they are for buyers or sellers.

Given today’s economic climate, many marketplaces are now offering alternative payment methods (APMs) such as Buy Now, Pay Later (BNPL), to allow consumers to pay for items over a longer period in manageable instalments. This means that even on a tighter budget, consumers can still access necessary goods, at lower, spread-out costs.

Secure payments offerings

In addition to varied payment offerings, marketplaces need to consider the security of their platform and transactions. Recent research shows that over half (59%) of consumers are more concerned about becoming a victim of fraud now than they were in 2021, following the cost-of-living crisis. What’s more, 62% of people are now so concerned about fraud they feel it is simply an inevitable risk of online shopping, up 17% compared to those who said the same in 2021. To further secure the digital payments process, marketplaces should work strategically with fintechs that offer sophisticated fraud and detection solutions to further instil trust with consumers.

Empowering the conscious consumer

Sustainability is now a key concern for many consumers. As there is a greater understanding of consumer impact on the world, consumers are looking for ways to consume more responsibly. According to Deloitte, however, price is the top reason many consumers have not adopted a more sustainable lifestyle in the last 12 months, with 52% claiming it’s just too expensive.

Resale marketplaces lower the barriers to entry for eco-conscious consumers, allowing them to continue shopping at a lower price. Furthermore, as well as being consumers, they can also be sellers and pass on pre-loved items. As shopping patterns continue to change, particularly among Gen Z and Millennials, resale marketplaces will be viable for consumers in fighting rising costs.

The same Deloitte report revealed that 40% of consumers have bought second-hand or refurbished goods in 2022 and this trend is likely to continue as economic issues remain prevalent and awareness of sustainable commerce practices grows.

Businesses are on board

It’s not just existing marketplaces such as Vinted or Wallapop that are recognising the opportunity presented by the rise in demand for pre-loved goods. Many established fashion brands are now creating their own resale or recommerce marketplaces to create additional revenue streams, enhance customer loyalty during tough economic times, and reach a broader range of customers.

For example, in October 2022 Zara unveiled plans to launch its new, pre-owned platform in the UK (Zara Pre-Owned) where customers can resell their Zara items through a peer-to-peer process – integrated through Zara’s physical stores, its e-commerce site and its mobile app. This launch will help companies continue to take steps towards a circular economy model, while encouraging customers to make more sustainable decisions on fashion consumption.

Looking forward, the resale fashion market alone is predicted to grow by 52% between 2023 and 2026 as shoppers continue to tighten their belts. As a result, there is clear space for C2C marketplaces to seize this as an opportunity to grow in popularity and cement themselves as key players in the e-commerce sector.