On Friday, RealReal Inc. joined a number of companies that recently went public, but in terms of direct competition, Chief Financial Officer Matt Gustke says there really isn’t any.
“I don’t want to say we feel kind of lonely, but we’re in a space of one,” he told MarketWatch shortly after the stock began trading. “There’s nobody that we feel like we’re directly competing with. We’re happy with where we are and the opportunity to grow for a very long time and would be just as happy with others growing with us.”
The RealReal REAL, -0.52% is a secondhand luxury consignment business that uses technology and human experts to feed its pipeline of goods, which ranges from women’s apparel, its most prominent category, to home items.
Read: 5 things to know about newly-public luxury secondhand retailer The RealReal
Much of the consignment business is done through “mom-and-pop” shops, Gustke said. But the secondhand category is an expanding one, with data from ThredUp, an online secondhand and thrift store, showing that the category could grow to $51 billion by 2023.
Shoppers are turning to secondhand goods as concerns about waste and the environment grow. Secondhand items are also a way to shop without paying full price.
Millennials and Gen Z are driving the push in secondhand goods and, Gustke said, they are also driving business at The RealReal. Their willingness to shop for previously-owned items could drive otherwise reluctant shoppers to give resale a try.
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“Millennials and Gen Z are already embracing this as a socially- and environmentally-responsible way to shop, but also to showcase their uniqueness,” said Gustke. Many items sold at secondhand shops can’t easily be found elsewhere, giving them a one-of-a-kind feel. “They’re driving a perception change for everybody.”
Areas where The RealReal sees the potential for big growth include men’s, watches and sneakers.
Don’t miss: Neiman Marcus, H&M join growing list of brands that are tapping the secondhand market
The SPDR S&P Retail ETF XRT, +1.51% has gained 3.4% for the year to date, the Amplify Online Retail ETF IBUY, +1.01% is up 23%, and the S&P 500 index SPX, +0.95% is up 17.4% for the period.