eBay has announced the acquisition of Depop, a popular second-hand clothing app, from its competitor Etsy for a sum of $1.2 billion (£890 million). The purchase is aimed at attracting a younger audience for eBay, with the deal expected to be finalized in the second quarter of this year.
Founded in London in 2011, Depop will maintain its name, brand, and platform following the acquisition. The move comes five years after Etsy purchased Depop for $1.62 billion (£1.2 billion).
The surge in interest from Gen Z and Millennial consumers in sustainable fashion and second-hand goods has propelled Depop’s growth. At the end of last year, Depop boasted seven million active buyers, with nearly 90% of them under the age of 34. In the U.S., the platform’s sales have surged by almost 60% over the past year.
eBay’s CEO, Jamie Ianonne, expressed confidence in the acquisition, highlighting Depop’s strong position in the pre-loved fashion market. The integration of Depop into eBay’s ecosystem is expected to leverage their combined strengths for long-term growth, particularly in the fashion sector.
The deal signifies eBay’s strategic focus on enhancing its presence in the consumer-to-consumer (C2C) fashion segment, which represents a significant portion of its annual gross merchandise volume (GMV). By tapping into Depop’s unique brand and community, eBay aims to cater to a younger demographic and expand its footprint in the recommerce landscape.
On the other hand, Etsy’s CEO, Kruti Patel Goyal, expressed enthusiasm for the transaction, emphasizing Etsy’s commitment to nurturing its marketplace for buyers and sellers. The move allows Etsy to concentrate on maximizing growth opportunities within its platform while ensuring a positive outcome for all stakeholders.
Peter Semple, the CEO of Depop, welcomed the collaboration with eBay, citing shared values and a common vision for sustainable fashion. The partnership is anticipated to accelerate Depop’s market reach in the U.S. and beyond, building on its success as a leading fashion resale platform.
Overall, the acquisition reflects a strategic alignment between eBay and Depop, marking a significant milestone for both companies in expanding their presence in the online fashion marketplace.