With the demand for second-life products growing, it’s important to understand the differences between these and brand-new products. Understanding these differences lends itself to understanding the benefits of each.
Ingram Micro Lifecycle works with stakeholders to develop recovery solutions that maximize the value of products through recommerce channels. We work with high-end consumer electronic products, including smartphones, wearables, gaming consoles, laptops, tablets, SDAs, etc.
Below, we set out the differences between ecommerce and recommerce practices of selling technology products, and highlight why it’s increasingly important to have recommerce alongside traditional ecommerce sales.
What is ecommerce?
Ecommerce is the process of selling new products through online platforms. These are typically direct-to-consumer sales. Examples include retailers and brands.
Demand for new product releases, including the latest models and technology innovations, drives this market. Global ecommerce sales are predicted to reach $4.3 trillion in 2025.
Defining recommerce
Recommerce is the process of entering the secondary market with products that have been used and prepared for re-use. These should have gone through recovery tactics to extend their useful life, including refurbishment, dating wiping, repair, rekitting, and repackaging.
Recommerce is very much a sustainability-focused activity, prolonging the product's lifecycle, and keeping it out of landfill for longer. It promotes a circular economy, rather than a linear one, and enables value recovery for the product owner.
The refurbished electronics market is projected to reach a global value of $168.76 billion by 2029.
The differences between ecommerce and recommerce
There are a few main differences between the two types of commerce, which ensures they equally have their place in the industry.
Product types
Ecommerce specifically handles new products, the latest releases, and the newest technologies. The products have never been used or owned before, and are new-in-box, in factory condition.
Recommerce promotes the use of older models and technology, extending their useful lives. It also applies to models that are new but have had a previous owner so can’t be considered new-in-box, but are like-new-in-box. These products may be returns from a customer change of mind or surplus to requirements.
Pricing
Specification of a product in either category will influence pricing, including storage space, camera megapixels, in-built AI features, etc.
Ecommerce sets the pricing of products to align with the manufacturer’s RRP (Recommended Retail Price). These are typically priced more highly than those sold through recommerce channels. There are some exceptions, such as demand for the product and specification. Or even retro products that have come back into fashion!
Recommerce products are priced using various factors to determine a suitable price, gauging market interest, and availability. Use and functionality, plus the level of investment required to bring the product to a saleable condition, all affect the pricing.
Environmental footprint
Brand-new products consume finite resources and raw materials for manufacturing and logistics. Therefore, ecommerce has a higher associated carbon footprint.
Recovery and recommerce of used products maximize available parts and spares, avoiding higher consumption of raw materials. Taking an older, used product and giving it a new life has a lower associated carbon footprint than if a brand-new product was sold. Through compliant recovery practices, used product waste is recycled or reused where possible. Sustainable materials are used for repackaging. Rekitting draws from existing peripherals, such as earphones and charging cables, rather than pressuring manufacturing for brand-new replacements.
Target market
Given that two different product types are on offer, brand new vs used, these target different sectors of the market, attracting different kinds of customers.
New products are aimed at an audience that is keen to have the latest and greatest technology. These may have a higher disposable income to accommodate purchases of a typically higher value.
Recommerce products are aimed at more cost-conscious customers who prioritize their needs over their wants. These customers are happy to compromise, settling for less functionality with value products. They’re eco-conscious consumers, aware of the environmental impacts associated with new technology or what happens to waste electronics.
Making the most of the sales opportunities
Both ecommerce and recommerce of technology have their place in the market and offer opportunities for sales growth. They differ from each other in terms of pricing, target markets, sustainability impacts, and product types. These clearly distinguish their activities and define their own sets of benefits, each working in tandem with the other and not in opposition to them.
Ingram Micro Lifecycle unlocks the full potential of returns and resale. Our solutions provide fast, efficient processing of returns. Over our years of experience, we’ve developed innovative market-leading processes that restore maximum value to a product. We have access to global secondary market channels to ensure the greatest value recovery for our customers.
Get in touch to discuss how we can support your returns management and recommerce practices today.
