DTC Dispatch #057

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Secondhand gift-giving is growing more acceptable, say 74% of shoppers

The resale market is booming, but not everyone is on board with gifting secondhand items, leaving some to wonder if it's a suitable choice for the holidays. While a preloved hoodie might not impress your moody teen, the practice is becoming increasingly popular.

According to a recent survey by resale marketplace OfferUp, 74% of shoppers feel that giving secondhand gifts is more acceptable this year, a 7% increase from last year. Even more telling, 83% of respondents said they would happily receive a preloved gift.

This sentiment is translating into action, with 68% of shoppers planning to buy secondhand gifts this holiday season. Among Gen Z, that number jumps to 83%, reflecting the generation’s growing embrace of sustainable shopping.

The survey, conducted online with 1,500 U.S. participants on October 13, highlights the shifting attitudes toward gifting and the increasing role of sustainability in holiday traditions.

Our take: The growing acceptance of secondhand gifting reflects a significant cultural shift in how we approach the holidays and consumerism. Once seen as a less thoughtful or even taboo gesture, preloved gifts are now gaining recognition for their practicality, sustainability, and often unique appeal. The OfferUp survey highlights this evolution, with 74% of shoppers acknowledging secondhand gifting as more acceptable and a staggering 83% willing to receive such gifts.

This shift is especially pronounced among Gen Z, with their strong focus on environmental consciousness and resourcefulness driving the trend. For them, secondhand items aren’t just about saving money—they’re about reducing waste and embracing individuality. This attitude is a refreshing counter to the excesses of traditional holiday consumerism.

While secondhand gifting may not resonate with everyone, particularly those who value the brand-new aspect of a gift, its rising popularity points to a broader reevaluation of what makes a gift meaningful. It’s no longer just about shiny packaging but about the thought, sustainability, and even the story behind the item. As this trend gains momentum, it could redefine holiday traditions in a way that’s kinder to the planet and to our wallets.

Why stores still spark joy around the holidays

The “death of stores” seemed imminent before the pandemic, as e-commerce grew and foot traffic declined. The pandemic accelerated these trends, leading to widespread store closures and a surge in online shopping.

However, four years later, physical stores remain essential. PwC’s Kelly Pedersen notes that foot traffic has returned to pre-pandemic levels, with younger generations embracing in-store experiences for browsing, returning items, and engaging with brands, even if purchases happen later online.

Retail spaces are evolving to meet these changes. Brands are adopting flexible setups like pop-up shops, catering to modern shoppers’ preference for discovery and interaction over transactions.

Despite e-commerce growth, brick-and-mortar stores still account for two-thirds of holiday sales, according to Experian. Physical shopping offers unique, tactile experiences that online platforms can’t replicate. As Kearney’s Michael Brown puts it, “Shopping happens in the physical world, where you look, feel, and engage,” ensuring the in-store experience remains a cornerstone of retail.

Our take: The “death of stores” narrative was premature. While the pandemic boosted e-commerce and forced retail adaptation, physical stores remain essential.

Today, stores serve as more than transactional spaces—they're hubs for browsing, interaction, and brand connection. Younger shoppers, in particular, value the in-store experience for discovery, prompting innovations like pop-ups and flexible leases to meet evolving preferences.

During the holidays, two-thirds of sales still happen in stores, offering tactile, sensory experiences online platforms can’t replicate. As Michael Brown notes, “Shopping happens in the physical world,” reaffirming the importance of in-person retail.

Rather than vanishing, stores are evolving, blending e-commerce convenience with the unique satisfaction of in-store shopping. This transformation ensures their lasting relevance in modern retail.

‘Brains and Beauty’ exhibit explores how the mind processes art and aesthetic experiences

Art is deeply personal, but what makes one piece captivating to someone while leaving another indifferent? A new exhibit, Brains and Beauty: At the Intersection of Art and Neuroscience, delves into this mystery, exploring how our brains perceive and respond to aesthetics. In Arizona, Stephanie Sy takes us inside this fascinating exploration of art and the mind for CANVAS, our arts and culture series focused on the intersection of creativity and health.

Our take: The exhibit Brains and Beauty: At the Intersection of Art and Neuroscience offers a compelling glimpse into the intricate connection between art and the human brain. It underscores a fascinating truth: art is not just a visual experience but a deeply neurological one, shaped by the unique wiring of our minds. This intersection of science and creativity not only sheds light on why art resonates differently with each individual but also emphasizes the profound impact aesthetics have on our emotions and cognitive processes.

Exploring how our brains interpret and react to beauty reveals the universality of art's appeal while celebrating its subjectivity. For some, a bold abstract painting may evoke inspiration, while others find solace in the precision of classical realism. By merging art and neuroscience, this exhibit encourages a deeper appreciation for the role of perception in shaping our connection to creativity.

Such initiatives are more than just intellectual exercises—they enrich our understanding of how art can influence mental well-being and even foster healing. As science continues to unravel the mysteries of aesthetic experiences, exhibits like this remind us that art is not merely a matter of taste; it is a profound dialogue between our senses, emotions, and minds.

TikTok bans some beauty filters for people under 18

TikTok has announced it will restrict users under 18 from accessing certain beauty filters that alter physical appearance, such as slimming features, enhanced lashes, or flawless skin effects.

The update, set to roll out in the coming weeks, will not affect playful filters designed for humor, like those adding bunny ears or other obvious effects.

This decision follows a report by the online safety nonprofit Internet Matters, which revealed that many minors struggle to recognize digitally altered images. The report also highlighted the “significant social pressure” young users face to meet unrealistic beauty standards online.

Our take: TikTok’s decision to restrict certain beauty filters for users under 18 is a welcome step toward addressing the growing concerns about body image and mental health among young people. With social media becoming an integral part of daily life, the pressure to conform to unattainable beauty standards has only intensified. Filters that distort reality—slimming faces, enhancing lashes, or smoothing skin—can have a detrimental effect, particularly when minors are often unaware of the manipulation at play. The recent report from Internet Matters underscores how difficult it is for young users to distinguish between real and altered images, compounding the pressure they feel to look a certain way.

By removing these filters, TikTok is acknowledging the need for greater responsibility in curbing the impact of unrealistic beauty standards. While the playful, humorous filters will remain untouched, this targeted restriction on beauty-enhancing tools is a step in the right direction for protecting the self-esteem of vulnerable users. Ultimately, social media platforms must continue to evolve to prioritize mental health while still allowing space for fun and creativity.

Sally Beauty Holdings (SBH) Surpassed Expectations in Q3

Meridian Funds, managed by ArrowMark Partners, released its third-quarter 2024 investor letter for the Meridian Hedged Equity Fund. The letter can be downloaded here. The Federal Reserve's recent decision to cut interest rates played a key role in stabilizing the market. In the quarter, the fund delivered a 6.19% net return, outperforming its benchmark, the S&P 500 Index, which returned 5.89%, as well as its secondary benchmark, the CBOE S&P 500 Buy/Write Index, which posted a 5.54% return. The fund emphasizes the importance of capital preservation during bear markets, which it believes will contribute significantly to long-term returns. Additionally, the letter outlines the fund's top 5 holdings, offering insights into its top picks for 2024.

One of the key stocks mentioned in the third-quarter update was Sally Beauty Holdings, Inc. (NYSE: SBH), a specialty retailer and distributor of professional beauty supplies. Over the past month, Sally Beauty has seen an 8.77% return, and over the past 52 weeks, its stock has surged by 46.23%. As of November 27, 2024, Sally Beauty’s shares closed at $14.14, giving it a market capitalization of $1.4 billion.

Our take: Meridian Funds' third-quarter update for the Meridian Hedged Equity Fund showcases strong performance, with a 6.19% net return that outpaced both the S&P 500 and the CBOE S&P 500 Buy/Write Index. The fund's focus on capital preservation in bear markets is particularly notable, as it highlights the importance of protecting gains during downturns to ensure long-term success. With the Federal Reserve’s recent interest rate cuts contributing to market stabilization, it seems that the fund is positioning itself well to navigate the broader economic landscape.

The mention of Sally Beauty Holdings as a top holding is intriguing, especially given the 46.23% year-over-year growth in its stock price. As a specialty retailer in the beauty space, Sally Beauty stands out as a company that may have benefited from the ongoing trend of increased consumer spending on personal care products. The strong performance of this stock demonstrates that the fund is not only focusing on large-cap indices but also identifying promising individual investments.

Overall, the Meridian Hedged Equity Fund seems to be adapting well to market conditions, blending a prudent strategy of capital preservation with targeted stock selections, like Sally Beauty, that are showing impressive growth. This combination of caution and growth potential could make it an appealing option for investors seeking stability and long-term returns.