Secondhand sensation: Major retailers ride rising popularity of refurbished goods

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Secondhand sensation: Major retailers ride rising popularity of refurbished goods

Published: 17 Sep. 2024, 10:00 Updated: 17 Sep. 2024, 19:10

A customer browses products at Emart's first official offline refurbished items store, Round Two, in Bucheon, Gyeonggi. [YOON SEUNGJIN]

Once stigmatized as inferior to new products, refurbished items are now gaining popularity across all age groups in Korea, riding on a shift in consumer preferences toward cost-effective products driven mainly by runaway inflation.

Major retailers, including Emart and Coupang, are capitalizing on this trend by expanding their offerings of refurbished products through both online and brick-and-mortar stores, with the latest example being a newly opened offline refurb store dubbed Round Two, which Emart established jointly with budget retailer Thank Q Market in August, in the former's Jung-dong branch located in Bucheon, Gyeonggi.

"I can't even count how many items I use at home that are refurbished," said a customer at Round Two. "Whenever I need to buy daily essentials or gadgets, I regularly scour the internet for the cheapest prices available on online platforms like Naver or Coupang. I believe offline refurb stores like this have an advantage because I can physically inspect the items before making a purchase."

"I feel like I'm hitting the jackpot every time I buy these products as they are fully functional but sold at much lower prices," he added.

Both brick-and-mortar stores like Round Two and online platforms like Coupang's "Return Market" reflect the growing popularity of the refurb market in Korea, which has an estimated value of more than 2 trillion won ($1.49 billion).

"Electronics, kitchen appliances and cleaning products are particularly popular. In today's high-cost environment, consumers appreciate having the option to purchase returned items based on their budgets and preferences," said a Coupang spokesperson. "This flexibility is a key factor in Return Market's success."

A staff member carries products at the Second Chance Store, a shop selling refurbished products from Amazon's Second Chance programs in central London, Britain. [REUTERS/YONHAP]

Refurb shops are not an unfamiliar sight for Western consumers, who have long been exposed to a wide range of refurbished products offered by major retailers like Amazon and eBay, with the refurbished retail market value in North America reaching $15.88 billion in 2023, according to market research and business intelligence firm Expert Market Research. In Korea, however, this concept is still relatively new and faces challenges in overcoming the existing negative perception of products that are not brand-new and perfectly packaged.

"The concept of refurbished products has a negative image in Korea, as many consumers perceive them as defective secondhand items," explained a Round Two employee. "Our mission is to dispel this misconception and raise awareness of the value and quality of refurbished products. By promoting wise and economical spending, we aim to shift societal attitudes."

A customer surnamed Jeon in her 20s was one of the first people to be disabused of the misconception surrounding refurbished products.

"I've completely changed my mind about these products," Jeon told the JoongAng Daily. "Before I visited this store, I assumed they were cheaper because they had defects. But after browsing some products here, I realized that's not the case at all."

"If anything, these products are good quality. The only difference is their more-than-affordable prices."

An ad for ″ugly″ vegetables sold on Ugly Us, an online platform that sells such produce [UGLY US]

Contributing to the recent expansion of such cost-effective consumerism is the new purchasing trend known as “YONO” or "You Only Need One,” a new phenomenon where a growing number of Koreans are actively seeking more economical spending options, particularly for daily essentials.

"Consumers are increasingly seeking products that offer either emotional value or practical utility," according to a June report by Kookmin Bank. "Unless a brand holds significant emotional resonance, people are more likely to prioritize cost-effective options, demonstrating a strong preference for gaseongbi, or value for money."

In line with this trend, domestic retailers are racing to introduce cost-effective products.

Examples include “ugly” farm produce sold at discounted prices due to their less-than-perfect appearance, meal kits tailored for single households and private-label snacks that offer lower prices by eliminating the costs associated with brand names and advertising.

"This trend is likely to persist. It's essential to recognize it as a societal shift, not merely a fleeting economic phenomenon," the report added.

Government and industry representatives pose for a photo at a Homeplus supermarket to promote sustainable practices at an event organized by the Ministry of Environment. [HOMEPLUS]

Beyond the financial advantages, the rise of such a trend also has positive environmental implications.

"Our goal is to align with the growing trend of resource recycling and sustainable consumption," an Emart spokesperson told the JoongAng Daily. "By reducing waste and extending the life span of products, consumers can contribute to a more sustainable economy."

"Customers can also benefit from reduced costs, while businesses can improve inventory management, minimize waste and improve the reputation of refurbished products, further fostering a long-term sustainable market environment," the spokesperson added.

BY YOON SEUNG-JIN [yoon.seungjin@joongang.co.kr]