Depop was developed by entrepreneur Simon Beckerman in 2011; it subsequently launched in Italy in 2013 and
Question:
Depop was developed by entrepreneur Simon Beckerman in 2011; it subsequently launched in Italy in 2013 and relocated to London in 2015. The company has expanded globally and also has offices in New York and Sydney. Depop has been described as an eBay/Insta-style marketplace predominantly used by Generation Z entrepreneurs and consumers alike. In recent times, Depop has gained a following of 30 million users across 150 countries,1 a number that tripled in less than three years, accelerated by the onset of the COVID-19 pandemic and an exponential growth in online shopping. Most Depop users comprise Gen Z consumers aged mainly under 26, who are committed to more sustainable consumption in their purchase and sale of second-hand and vintage clothing, shoes, jewellery and more. The Depop allows its users to also follow influencers and engage with one another. Its main competitors include Vinted, Poshmark, Letgo, Carousell, Everlane, Lyst and Tradesy. Marie Petrovicka, vice president of markets at Depop, has observed that the growth in followers has been driven largely by organic and word-of-mouth growth, especially during 2020. In 2021, it announced a new sustainable fashion plan to influence responsible fashion consumption. The two-year plan comprises key strategies around corporate governance, protection of the planet, people and platform, to have a significant collective impact and to drive positive change at a corporate level and within its Gen Z community as a whole.
In October 2020, Depop and Bain & Company undertook qualitative and quantitative research on ‘how Gen Z’s empathy, awareness and fluidity are transforming business as usual’. The findings that emerged have set the bar in terms of how Gen Z consumers view the world, engage with life and with one another. Key findings include a paradigm shift in terms of the interconnected and fluid way in which Gen Z process content, and highlighting key vulnerabilities of this age cohort coupled with their priority for authenticity, particularly in the arena of brand activism, while also acknowledging that a collective consciousness empowers individuality.
Furthermore, what is of interest to marketers and content creators is the blurring of boundaries in terms of user engagement and consumption between commerce, community and entertainment. It is widely accepted that the future of retail is on course to progress in a predominantly online, omnichannel environment, with a social, experiential and sustainable ethos.
From the fashion industry’s perspective, it is evident that luxury brands are benefiting from a healthy second-
hand market in terms of attracting and building a new customer base who have discovered these highend brands, which have become accessible to them thanks to apps like Depop as seen in the table below.
Consequently, luxury brands are building a new set of loyal customers, who may previously not have been able to afford items from their product lines. The additional benefit is that these consumers are also engaging in sustainable consumption. Furthermore, these high-end fashion brands can reward sellers with buy-back programmes and exclusive loyalty schemes, and sellers can shop for new pieces with the revenue they have gained from their sales of existing items.
Questions
1. How have needs, wants and demands evolved for Gen Z consumers in particular? Evaluate how Depop adds value for these customers.
2. How might Depop and its key stakeholders continue to develop in response to evolving market changes?
3. What are the challenges that Depop has to consider in order to progress the business and how should it respond?
4. Evaluate and describe the unique challenges for two-sided businesses like Depop in terms of its current business practices and its continued success.
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