We Love PreLoved: How can charity stores profit from the rise in shopping ethically?

Best retail design agency London

Billie Eilish donates Glastonbury outfits to Oxfam #SecondHandSeptember.  Photo: ©Aaron Chown/PA

 

If more and more of us are shopping ethically these days, then why do half of shoppers in the UK think a healthy high street should contain fewer charity stores? There are many powerful forces driving the growth of ethical consumerism today, but charity stores aren’t in on the action as much as they could be despite a 5% increase in sales in 2018. With the rise of the circular and sharing economies, charity stores have an important role to play in the modern retail mix more aligned to new consumer attitudes. So how can charity stores get better at pulling in today’s eco-consumers, connecting them with their cause and building trust?

 

Ride the Ethical Zeitgeist

Ethical consumerism is fast becoming the new-norm. Now, more than ever, we are choosing to buy from companies that we trust behave ethically and sustainably. According to an EY survey, two-thirds of us take the ethics of a brand into account when we’re deciding what to buy. Ethical spend across all sectors has doubled in the last 10 years, to the tune of £1,238 per UK household in 2017. And the younger we are, the more we care. 32% of Millennials and 34% Gen-Z are willing to pay 20% more for ethical products, compared to just 5% of Baby Boomers. It’s not just money they’re prepared to part with either. Research by Third Sector shows more are volunteering: 33% in 2017, up from 28% in 2016 and triple that of over 55 year olds giving up their time. As these younger shoppers mature, their concerns will grow too, providing charities with a ready-made audience switched-on to casual brands and shopping for good causes.

 

Image:©Start Design/Oxfam

 

Fashion for Change

Fast-fashion is bearing the brunt of ethical concerns, as shoppers question its throwaway culture and unsustainable industry practices. A factor that should be playing right into the hands of charity stores. Many consumers are already lapping up the novelty of new sustainable propositions, fuelling sharing and circular economies that are founded on access over ownership, second-hand over brand-new and repair rather than disposal. Buying clothes for reuse has exploded in the last few years. A recent report from fashion resale marketplace, ThredUp, predicts that the second-hand market will be larger than fast fashion by 2028, fuelled by Millennial and Gen Z thrifters, and their willingness to adopt used items 2.5 times faster than the average consumer. The nascent clothing rental market is predicted to be worth $2.5bn by 2023, according to Global Data, satisfying Millennial’s seemingly opposing needs – a constant craving for new clothes, alongside a desire to own less gear.

 

Combine all this with the fact that Millennials and Gen Z still love visiting physical stores, and it’s a climate that’s ripe, you would think, for charity stores to benefit. Surely a local charity shop could be the perfect haunt for these ‘woke’ shoppers motivated by good causes, stoking the circular or sharing economy that they helped to invent in the first place?

 

 

Here are 7 considerations informing the future of Charity retail.

 

 

Image: ©Rent The Runway

 

1. Rise of ‘woke’ consumers.

Charities can learn a lot from the disruptive retail brands defining new ways forward to meet new consumer attitudes and behaviours of Millennial and GenZ (Woke) consumers who crave newness and quality, but don’t want to buy New. Take clothing rental business, Rent The Runway – its runaway success hinges on its part-subscription model of hiring out designer pieces rather than selling them. Beijing based YCloset, and Urban Outfitters owned Nuuly in the US, have similar offerings.

 

Players in the pre-owned space are also reinventing how second-hand clothing is bought and sold. In the US, ThredUP trades on a clear, sustainable message, but its online platform, positioning, size and scale means it can satisfy the needs of an Instagram generation addicted to creating fresh looks. Similarly, social shopping app, Depop, is amassing teen vintage clothing geeks at fast pace, putting them in control of a marketplace that makes buying, selling and wearing second hand gear exciting for a whole new generation.

 

Established by luxury fashion professional, Sarah Fung in 2016, Hula is a fast-growing Hong Kong online preloved consignment platform that has recently opened the city’s first warehouse store dedicated to the resale of designer womenswear. HULA is a highly curated online marketplace, with pieces in mostly New or Hardly-Worn conditions at up to 95% off retail. Sellers are by-invite-only ‘fashion industry insiders’, with bags authenticated by Entrupy to be authentic-assured. Hula partners with charities and donates 5% of net profits.

 

Photo: ©Hula

 

2. Young rebels with a cause

Millennials and GenZ love an anti-mainstream shopping vibe; they want to visit places that are so much more than stores to buy yet more stuff. GenZ will account for 40% of global consumers by 2020, with 9 in 10 believing all companies have a responsibility to address environmental and social issues. It is here that charities have an advantage and an opportunity to align with these changes in attitudes by offering a contrast to conventional fashion retail by connecting shoppers with their work.

 

New ideas and services are vital to getting young, ethical shoppers to buy into a brand. Launched at Glastonbury – Oxfam’s #SecondHandSeptember asks shoppers to pledge to say no to new clothes for 30 days. Artists like Billie Eilish, Sheryl Crow, Johnny Marr and Kylie gave their support by donating and pledgers will be the first to know when these celebrity outfits go up on Oxfam’s Online Shop.

 

ReTuna Aterbruksgalleria in Sweden is the world’s first recycling shopping mall. A revolutionary concept, it’s built right next to a recycling centre, making it easy for people to donate items they no longer need. Donations are then distributed to the shops inside the mall and the owners repair, upcycle and sell on. It’s an educator too, running clothing repair and repurpose, furniture restoration and upholstery workshops, as well as other events. Initiatives like this can pull-in shoppers and donators, inspiring a reuse and mend mindset that we’ve seen is already gathering momentum elsewhere.

 

Image: ©ReTuna Aterbruksgalleria

 

3. Give Them Time

We’ve written before about how giving shoppers multi-experience spaces like these encourages people to linger in store. The more time they spend, the better chance brands have to connect and drive consideration. This is all the more important for charities. Their stores are not just about raising funds, they can be a powerful way to raise awareness and recruit volunteers. Using the store experience to deepen the relationship and build trust between a charity and the public is crucial. Charities are now experimenting with different store formats and in-store experiences to increase dwell time.

 

Start Design has worked with Oxfam since 2012 and most recently to create its newest ‘superstore’ format; a larger, out of town store which includes dedicated space for educational activities and social events that support its ethos as a charity. As well as event space, Oxfam’s superstore includes a café, specialist departments for clothing, furniture, gifts and eye-catching visual merchandising, making it much more of a destination for shoppers.

 

Image: ©StartDesign/Oxfam

 

4. Purpose Each Moment

According to Demos, 9 out of 10 people make at least one purchase a year from a charity store. That visit could be the difference as to whether a person visits again, decides to donate or even signs up to volunteer. Charities must not waste a single moment in store to drive home the impact a purchase or donation can make on the charity’s cause. It’s about thinking how to bring purpose to purchase at every touchpoint of the visitor’s journey – welcome, browsing, changing rooms, donation points, checkout and exit. Our store concept for Oxfam features materials found in the field, such as water tanks, buckets and taps as merchandisers that constantly remind visitors where money is going. We elevated the window displays with products and key messaging, to stop passers-by and draw them in to the store.

 

  Photo: ©French+Tye for Shelter and Hemingway Design

 

5. Target The Offer

Charity stores are triple-audience centric supporting shoppers, donators and volunteers, however, the store is the domain of the shopper and needs to meet their requirements for assortment, experience and design. Boutique by Shelter at Coal Drops Yard, Kings Cross in London is anything but your average charity shop. The developers wanted a charity shop to send an important message about how charity retail should fit into modern shopping mix – the first time a charity store has been included in the line-up for a premium shopping district. Carefully curated stock, showcasing the best donations of designer and vintage, is merchandised in a ‘modern salvage’ store concept by Hemingway Design.

 

6. Community-Minded

There are currently around 11,000 charity stores in the UK, 25,000 resale, consignment and Not For Profit resale stores in the US. Whether they’re small, independents or part of a national charity, research shows that they create value beyond just fundraising because of the role they play in their local communities – supporting high streets as employers and delivering opportunities for volunteering.  Charity stores can make sure they’re an active part of their communities by acting as a venue for local events – from fashion shows to support groups for its specific cause. Charities can think beyond existing store locations to targeted and strategic locations, implement format strategies from high end boutiques and specialist stores to large formats and donation points. Pop-ups and events take the charities into the communities they serve.

 

7. Beacons for Ethical Shoppers

Fundraising is more challenging than before and retail has changed; charity stores need to catch up if they’re to justify their place in the modern retail mix. As the ethical economy grows, competition for the ethical shopper grows too. Charities must convince these customers that they have on-trend assortment and buying from them has the most impact – not only fun, but the right thing to do.

 

There are valuable insights from new and emerging fashion retail growth stories – pre-owned, resale, rental and subscription – that inform how to grow a successful modern retail brand. Charity retailers have an opportunity to become thriving destinations for shoppers by creating relevant, on-trend, digital and physical store experiences that bring the fashion conscious and local communities together in support of worthwhile causes.

 

 

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