Etsy’s Depop Acquisition: A $1.6bn Reminder For Retail to Recognise The Next Generation of Shopper

Etsy, the online selling sanctuary for crafters everywhere, recently made a move that seems somewhat out of left field – it bought Depop, the peer-to-peer fashion marketplace which has been likened to Instagram and eBay having a baby. This is the latest business step-change in another explosive year for eCommerce and underscores my belief that shopping has changed forever, even with stores reopening in recent weeks.

Over the past few months, we’ve seen Boohoo buy Debenhams and ASOS purchase Arcadia. But, although Etsy’s $1.6bn acquisition may seem even more surprising than those deals, the handmade product haven will be granted direct access to the next generation of consumers through Depop, which has a strong user base dominated by under 24s. That makes the deal a very shrewd move for future growth potential.

Keeping up with the in crowd: Culture, community and customer service

The takeover comes as apps with younger demographics such as TikTok have rocketed, revolutionising marketing to Gen Z and heavily influencing their buying decisions. Depop’s CEO Maria Raga said that users “come to Depop for the clothes, but stay for the culture.”

If we observe what that so-called culture must comprise from a fulfilment point of view, Gen Z’s expectations around fast customer service and a frictionless experience are unparalleled. They have grown up in an on-demand world, with products easily available and immediately delivered to their doorstep.

Etsy – and any retailer looking to serve this demographic – will be aware that accessibility and convenience are key when engaging with this younger audience, and it certainly shows in how Gen Zs engage with onsite reviews. According to our recent survey of 1,000 UK online shoppers, 53% of the category read reviews every time prior to purchasing a product, and they ranked highest of all groups in leaving a review after every online purchase (11%).

50% stated they will leave a good review after just one positive experience, and 48% will leave a bad review after just one negative experience, so it’s crucial to provide an excellent experience every time. However, online sellers would be wise to treat all buyers in this way to remove any room for dissatisfaction across the board, regardless of age.

Depop is designed with younger, social media-savvy users in mind and has been described as a “community” in the acquisition announcement. This cements the emerging importance of social networks as a purchasing tool, such as Instagram Shopping, in an increasingly multi-channel world. Retailers must be clever on how they navigate this, and the deal should be a wake-up call for online retailers to think carefully about how they will support this next generation of shoppers.

Gen Z places a higher value on the environment and they are more sustainability-conscious consumers; for this always-on, entrepreneurial generation, a simple sale or purchase won’t cut it. Sellers must ensure their brand image extends throughout the entire customer experience, so that means providing buyers with all relevant information about their order that they might need, from purchase to delivery to after-care. But of all the things they value most, 57% of our Gen Z respondents say quick customer service response is the most important factor in their overall experience, so Etsy, Depop and similar sellers must ensure they are committed to the right technologies to make this happen.

The same survey revealed that 37% have used Etsy and 22% Depop, demonstrating a solid base for both, but also significant room for growth. By leveraging Etsy’s extensive ecommerce experience with acknowledgement of Gen Z’s distinct desires, this deal has the potential to deliver rich insight. It can ensure shoppers, the older and younger generations, stay satisfied while sellers make decisions based on transactional intelligence.


Written by Alex Payne, CEO at eDesk: the eCommerce customer service specialist