Circular fashion comprised 27pc of US online luxury apparel spend in 2024: Mastercard

April 25, 2025

The trend is expected to expand in the coming years. Image credit: Mastercard

Sustainability’s grasp on the high-end space is increasing, according to the latest findings from global payment technology company Mastercard.

Released by the corporation’s macroeconomic trend analysis division, the Mastercard Economics Institute, the whitepaper details the growing prevalence of circular fashion in the luxury space. Last year, upcycled clothing accounted for more than a quarter, 27.4 percent, of online luxury spending in the United States.

The publication, titled “Did you know? Circular fashion is sustainably on trend,” is based on internal tracking of credit card spending across the U.S. between 2019 and the first quarter of 2025.

Regaining ground
Secondhand fashion is gaining market share at an accelerated rate compared to previous years, with this increased momentum expected to carry into 2025.

By the end of last year, the sector had regained the demand it carried pre-pandemic, as market share sat at 26.7 percent in 2019, before tumbling to 22.8 percent in 2020. The figure slowly trended upward in the following years, before jumping by nearly 3 percent in 2024 alone.

Mass-market circular fashion merchants are growing at a faster rate than in the luxury space, though their momentum has fluctuated over time. Image credit: Mastercard

By the end of 2025, Mastercard Economics Institute foresees the percentage of U.S. online apparel spending on luxury secondhand goods to reach 28.8 percent.

This surge coincides with an ongoing luxury revenue slowdown, which has seen prices rise and value-conscious consumers seek alternatives, such as resale and circular clothing retailers rather than contributing to the bottom lines of brands through direct-to-consumer sales and wholesale via brick-and-mortar retailers (see story).

This buyer behavior is also extending into the watch and jewelry sector, according to recent findings from Positive Luxury (see story).

Upward momentum
In tracking the market on a month-to-month basis over the past six years, analysts at Mastercard picked up on another trend in the secondhand space – the spring closet refresh.

While the action is most prevalent in the mass market clothing sector, as the month of March accounts for 9.2 percent of annual apparel spending, luxury is also included in this seasonal surge. March represents 8.2 percent of the high-end space’s annual resale purchases, beating January and February, as well as most of the summer months, with the exception of May at 8.4 percent.

Expectedly, the year-end holiday season sees the most spending in the luxury market. Image credit: Mastercard

Several large localities are also heavily participating in the secondhand high-end space, with Los Angeles and Las Vegas leading the charge, as circular fashion makes up nearly 7 percent of all clothing spending. The latter city’s circular fashion is booming at a greater rate than the overall online retail sector, with the growth differential reaching 17.1 percent; meanwhile, Portland, Oregon, is at the forefront of this movement, outpacing digital sales by more than 20 percent.

The company points to a rising, environmentally-conscious and budget-oriented sect of consumers becoming aware of resale platforms, such as Mytheresa and Farfetch, as a major contributing factor to the division’s recent and future growth.

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