Online apps such as Alibaba's Idle Fish are making reselling simpler than ever before

Nala Lei is busy decluttering her two-bedroom apartment in Hangzhou, a city in southeastern China, using an app on her mobile phone.

The 39-year-old has sold over 200 pieces over the past 12 months on China’s largest secondhand digital marketplace, Idle Fish, which is owned by e-commerce giant Alibaba Group. She made over RMB40,000 (US$6,174), cash that will go towards a few items she has long coveted.

“I was spending a lot of time in my apartment. At some point, I felt anxious looking at the clutter and started reselling online,” said Lei.

Lei is not alone in embracing secondhand trading in China, also known as re-commerce, to raise extra cash via online platforms such as Idle Fish.

The trend has been turbo-charged by apps that make selling pre-owned items simpler, the need to optimize space while living at home during the coronavirus pandemic, and as people adopt a more sustainable way of life.

Statistics from Alibaba’s midyear shopping festival, 6.18, showed that the trend is gaining momentum across all demographics in China. During the month of the 6.18 shopping bonanza, the number of product postings in categories such as used electronic and maternity products nearly tripled year-on-year.

“At least 40% of the products around us stay idle every day,” said Tang Song, general manager of Idle Fish.

Out With The Old & In With The New

The coronavirus pandemic has accelerated the growth of the global resale market as some people tightened their purse strings, according to thrift store ThredUp and research firm GlobalData.

Hangzhou-headquartered Idle Fish’s registered sellers surpassed 30 million by the end of 2020. Additionally, more than 200 billion items were sold on the platform last year.

"[The] recent onslaught of the pandemic has inspired many people, especially younger generations with limited spending power, to rethink buying secondhand. As they search for more cost-effective ways to upgrade their lifestyles, many have turned to Idle Fish for answers," said Idle Fish’s Tong. 

China's re-commerce market will generate over RMB500 billion (US$77 billion) in gross merchandise volume (GMV) on the app by the end of this year, Idle Fish estimated. Up from RMB200 billion last year.

"China's online re-commerce market will continue to boom as Chinese shoppers become wealthier and more sophisticated, more and more people are turning to secondhand shopping as a sustainable way of life," said Mark Tanner, managing director of China Skinny, a Shanghai-based marketing and research agency.

Circular Economy

Online apps have made reselling simpler. In 2014, Alibaba's leading e-commerce marketplace Taobao took on the idea of re-commerce and launched Idle Fish to nurture a circular e-commerce economy in China.

The two apps are interlinked so shoppers can browse through their purchase history on Taobao and select any item for reselling with just one click on Idle Fish. The process also provides a recommended price for pre-owned goods across different categories, typically at 50% of the product's original cost, making the whole process transparent.

As Idle Fish matured, it focused on two things: trust and interaction, said Tang from Alibaba.

Customers’ biggest concerns about buying secondhand were around the quality of items and that products wouldn’t turn out exactly the way they were portrayed online.

To address these issues, the platform launched a dedicated platform-certified channel featuring high-value products such as electronics and fashion sneakers that have been inspected and authenticated by third-party professionals.

Vice versa, sellers new to the scene can choose free mail-in or pick-up services to have their items inspected and sold by the platform. After major sales like 6.18, the app saw demand surge for recycling and concurrently rolled out a promotion to help users resell their unwanted products. Remuneration is almost instant and above market value in some of these cases.

Idle Fish taps into Alibaba's credit-scoring system, Sesame Credit, to add an additional layer of trust to the process. Users can choose to disclose their credit score and receive a digital badge to validate their credibility. Secondhand shoppers can filter their searches by sellers’ credit rankings, to further build trust in the process.

"Making profits in re-commerce is all about diligence and trust. At one point, I was sending out five parcels a day because of the extensive product listings I created. It is also important to do the extra work and upload candid photos and descriptions about the condition of your pre-owned goods," Lei explained.

Nala is now a trusted re-seller with hundreds of followers on Idle Fish. Though most of her transactions have been clothing and household items, positive reviews and high transaction volume lent her credibility so that she was able to sell a piece of gold jewelry worth RMB600 (US$92), the type of product typically traded exclusively offline given its high value.

More Than Transactions

Whether saving or earning, money is a major incentive behind the rise of re-commerce. But the social interactions and online communities within Idle Fish are giving users reasons to stay online.

The app also includes interactive features such as livestreaming, influencer-driven communities and forums, online auctions starting as low as RMB1, and dedicated channels for finding rare vintage handbags and handmade couture.

Additionally, Idle Fish is also known as a "super app" because it connects people by location:  users can find same-city services, including part-time jobs, door-to-door repairs, recycling stations and even leased properties.

Despite having cleared out most of her closet already, Lei said she is still quite active on the app and enjoys answering inquiries from her followers since she can always unearth something lying around to sell online.

"When a product becomes idle, it is worthless to me. But through the power of online communities and apps, it’s an accomplishment to turn my trash into somebody else's treasure," Lei said.

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