Could IKEA’s 2nd-hand Marketplace Rival eBay & Gumtree?

IKEA is encouraging its customers to buy and sell their used furniture among themselves to boost sustainability and reduce the collective carbon footprint.

The home furnishings company has launched IKEA Preowned in Madrid and Oslo and plans to roll it out globally by December.

Ingka Group | IKEA CEO Jesper Brodin said: “It has been a dream in the making and I’m excited that we are finally testing IKEA Preowned, our secondhand marketplace. We will start in Oslo and Madrid, yet the ambition is higher.

“With the test we will get deeper insights in how we can meet people's dreams and needs in life at home, by making the IKEA range more accessible at an even lower price and as a part of our sustainability efforts.”

Senior Product Designer Adriana Chiaia said on LinkedIn: “It’s live! It has been so exciting to be the senior product designer for IKEA Preowned, our IKEA second hand marketplace. Do you live in Madrid or Oslo? Check it out!”

How does the flatpack giant’s service fit in?

As is the case for most businesses, the toughest area to have an impact on is Scope 3 emissions – those produced by its suppliers and customers.

While the incentive scheme will produce more profit from the resale of its own goods, the biggest win is likely to be far fewer IKEA products going to landfill.

With the global market for second-hand furniture growing year-on-year and sales of used IKEA furniture already very popular online, IKEA’s entry into the space seems logical.

Currently, an ‘IKEA’ search on eBay turns up 25,000 results, while the same search on Gumtree throws up 10,000.

Redirecting a proportion of that custom and adding to it would be good for IKEA’s sustainability targets, profits and reputation.

Building its own online marketplace would also allow IKEA to focus less on its brick-and-mortar stores - which are expensive with high operating costs.

The circular argument

The relationship between environmentalists and furniture multinationals has long been strained.

The firms face criticism for the amount of plastic and other waste that goes to landfill or is fly-tipped on open ground.

That criticism is amplified when companies slash product prices in flash sales, which encourage customers to dump existing pieces of furniture.

Today, there is a growing focus on the circular economy, where everything could be used more than once, with pressure building for producers to be responsible for the resale of their products.

The argument is that this would force companies to make items more durable, less disposable and more sustainable.

EBay: The second-hand marketplace big hitter

The undeniable leader in the global online second hand market is eBay, which is formally described as a global e-commerce platform that facilitates consumer-to-consumer and business-to-consumer sales.

It was founded by Pierre Omidyar in 1995 in San Jose, California, originally as AuctionWeb, an online auction site.

The platform quickly gained popularity, allowing users to buy and sell a wide variety of goods through an auction-style format, as well as fixed-price listings.

Having become a public company in 1998 and rapidly expanded its operations internationally, eBay diversified its offerings beyond auctions to include Buy It Now options, online storefronts for businesses and a vast array of product categories, from electronics and fashion to collectibles and cars.

The company’s revenue comes primarily from listing fees and a percentage of sales, known as the ‘final value fee’.

Sellers on eBay range from individual hobbyists to large businesses. The platform supports multiple payment methods, and PayPal, once an eBay subsidiary, was the primary payment processor until it was spun off in 2015.

EBay’s CEO is Jamie Iannone, who took the role in 2020.

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