The luxury resale market has become a central focus in the fashion industry. It expanded from $37.95 billion in 2025 to $41.61 billion in 2026, marking a compound annual growth rate of 9.6%. Projections indicate it will reach $60.11 billion by 2030. Secondhand sales are expected to grow two to three times faster than firsthand sales over the next two years, potentially reaching $317 billion, as reported by the State of Fashion 2026 by Business of Fashion and McKinsey.
Currently valued at $393 billion, the global secondhand market is outpacing overall retail growth. This shift is driven by three main factors: technology easing transactions, consumers integrating resale into their financial habits, and brands becoming more involved. These factors represent not just niche growth but a significant transformation in how luxury goods are bought and valued. Brands lacking a strategic response to this shift are already trailing.
According to BoF Insights and McKinsey, high-spending luxury clients, rather than budget-focused consumers, are the most active in the secondhand market. This challenges the traditional narrative that secondhand shopping is mainly driven by price sensitivity. Now, 58% of affluent shoppers prefer authenticated secondhand items over new ones.
Over 60% of luxury resale buyers are motivated by affordability, while 54% prioritize sustainability, viewing resale as a responsible alternative to fast fashion. These motivations cater to different consumer segments, necessitating distinct strategies: one targeting value-seekers and another appealing to those driven by values.
What the Numbers Are Telling Brands
Last year, circular sales constituted 27% of the luxury market, according to Mastercard Economics Institute. Vinted, a luxury reselling platform, became France’s leading retailer by volume this spring, with net profits soaring over 330% between 2023 and 2024. Mid-market brands experienced a 300% increase in branded resale sales from 2021 to 2025, as noted in State of Fashion 2026. These figures highlight the rapid shift from being an alternative option to a crucial component of the luxury market.
The US online resale sector is projected to grow 16% annually, reaching $34 billion by 2027. In 2024, online resale platforms are expected to account for 88% of resale spending in the US. This digital expansion is significant for luxury brands as it creates a parallel market operating outside their control.
For instance, a Hermès bag sold through The RealReal does not generate revenue, customer data, or brand-managed touchpoints for Hermès. These high-demand items circulate in channels beyond the brand’s control at prices they do not set, reaching consumers they might otherwise never contact.
Gen Z Is Driving the Shift from Both Sides
Approximately 32% of Gen Z wardrobes consist of secondhand items, increasing to 45% for handbags. Gen Z consumers are seven percentage points more likely than the average shopper to value the excitement of finding unique pieces. Raised with an awareness of climate issues, this generation uses its purchasing power as a form of activism. The focus in luxury resale has shifted from brand visibility to the unseen impact of the purchase.
Now, one in three consumers considers the resale potential of fashion items, particularly in premium and luxury sectors. Over 74% of consumers are willing to pay more for items with complete traceability and sustainability verification, with 26% ready to pay up to 20% more for products with a digital product passport. This data point carries substantial commercial implications.
A new generation of buyers is making purchasing decisions based both on secondary market value and the sustainability credentials of a product. Brands that offer these credentials and incorporate secondary market appeal from the design stage will attract this demographic more effectively than those viewing resale merely as an issue to manage rather than an opportunity to develop.
How Brands Are Responding and What Still Needs to Happen
Brands are increasingly launching their own resale initiatives through partnerships with infrastructure providers like Trove and Archive to control pricing, gather customer data, and promote sustainability. Innovations such as Croissant, which offers guaranteed buyback pricing, are improving market liquidity and integrating resale into initial purchase decisions.
Resale also acts as a gateway: 43% of budget-conscious shoppers eventually purchase new products from the same brand, according to the State of Fashion. This figure reframes the resale conversation for brand strategists, suggesting that attracting customers through the secondary market can lead to primary market conversions, turning it into a customer acquisition story instead of a revenue loss.
Companies like The RealReal and Vestiaire Collective continue to employ AI and blockchain technology to improve the authentication of pre-owned luxury items. However, only 7% of industry leaders plan to support circular business models, and less than a third of them regard resale as a priority for 2026, as per the State of Fashion.
The disparity between the market’s growth rate and the industry’s reaction rate presents both a challenge and an opportunity. Brands that close this gap first will gain a competitive edge in the rapidly expanding luxury market segment. Those that delay may find that platform players have already established strong customer relationships.
Featured image: StyleRave Studio/AI-generated Visual
