As the secondhand apparel market booms, used clothing is becoming an acceptable holiday gift

Key Points
  • The secondhand apparel market is booming.
  • Nearly half of respondents to a recent survey by Accenture said they would consider giving secondhand clothing as gifts, while 56% said they would welcome gifts of this kind for themselves.
  • Department stores such as J.C. Penney and Macy's have begun to take advantage of the secondhand apparel market.
Hannah Oh wearing a second hand dress from Zara her sister bought for her on Poshmark.
Source: Hannah Oh

Hannah Oh's sister gave her a dress from Zara for Christmas, but her sister didn't buy it from Zara. She bought it secondhand from the retail resell site Poshmark.

Oh, 19, saw the dress online and knew she wanted it, so she sent the link to her sister on a wish list.

"I didn't really want to buy it for myself because I'm on a really tight student budget," Oh said.

The secondhand apparel market is booming. By 2023, the market is expected to reach $51 billion, according to a recent report from the online resale store ThredUp.

It's become more acceptable to give and receive secondhand gifts. In a recent survey by Accenture, 48% of respondents said they would consider giving secondhand clothing as gifts, while 56% said they would welcome gifts of this kind for themselves.

"As long as you adhere to the standards of gift giving in general, I don't think secondhand, or the fact that it's purchased secondhand, has to be a negative," said Oh, who is studying digital fashion marketing, secondhand e-commerce and entrepreneurship at Drexel University — a major she created to fit her interests.

"If you invested money and time and care into it, then that's what makes a good gift."

Department stores have begun to take advantage of the secondhand apparel market. In August, Macy's partnered with ThredUp to offer secondhand apparel at 40 Macy's stores. J.C. Penney also offers secondhand women's clothing and handbags from ThredUp at 30 of its stores.

Source: J.C. Penney

J.C. Penney's partnership with ThredUp will allow holiday shoppers to find select national brands for the first time in J.C. Penney stores, said Michelle Wlazlo, chief merchant at J.C. Penney.

"Our thoughtfully curated spaces will be refreshed frequently, and our customers will find new items to fall in love with every time they visit, offering even more inspiration as the holiday season approaches and allowing them to make the most of every occasion," Wlazlo said in a written statement to CNBC.

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Even if they are giving them as gifts, buying secondhand allows people to get their hands on items they would otherwise feel guilty purchasing, such as designer clothes or something that isn't necessarily useful to them, said Tom Meyvis, a professor of marketing at New York University's Stern School of Business.

"If you buy a designer thing like Armani secondhand from somewhere like Macy's, it's still something that is frivolous and luxurious and indulgent," Meyvis said.

Gift givers are motivated by giving people something they enjoy. Shopping for a secondhand gift may provide even more of an opportunity to show you care for the receiver. Going on a search for a secondhand $60 Armani sweater, for example, may require more effort than buying a new $60 sweater from a lower-priced brand, Meyvis said.

"I'm using the same amount of money but I'm putting more effort into it — I found this little gem," Meyvis said. "I managed to get you an Armani product."

The increased popularity of purchasing items secondhand is not just about being frugal, he added — it's also about doing something good for the environment.

"It is getting more popular, especially for the younger generations," Meyvis said. "They're more aware of the environmental issues."

He added that they are also more familiar with shopping in thrift stores.

"[Gifting secondhand items] is already more normative for part of the population and maybe it will become more normal overtime," Meyvis said. "Partnering up with a company like Macy's will help the normalization of that."

Oh also sells her own clothing secondhand on Poshmark. She said during the holiday season, people buy things secondhand that they can't find elsewhere, such as vintage and designer items.

"Secondhand doesn't necessarily have to mean that it's been worn 50 times before it was dropped off at a thrift store," Oh said. "Sometimes, they still have the tags on them."