‘Platforms have to walk a very fine line’: Why 2024 was the year of the resale fee wars

In some of the cases, users applauded these policy changes. For instance, sellers praised Depop and eBay U.K. for lowering their selling fees to 0% in July and October, respectively. Not all changes were welcomed, however. In October, Poshmark sparked seller outcry after lowering fees for sellers but upping them for buyers — a move sellers worried would lead buyers to abandon purchases at checkout. In December, Mercari said it was getting rid of its 0% selling fee — something it had implemented in March — and passing fees onto buyers and sellers alike. Responding to the Mercari change, one user wrote on Reddit, “They literally said[,] ‘Now everyone gets to be unhappy.'”

While resale is more commonplace than it was years ago — even outpacing traditional retail spending in 2024, according to a report from Consumer Edge — platforms are still struggling to figure out a long-term fee structure. Not only are these platforms competing with each other, but they’re also competing for attention from buyers and sellers. That can be a difficult tightrope to walk; the same policies that might deliver returns to shareholders could enrage users and drive them to other platforms.

“Platforms have to walk a very fine line between trying to increase their revenues and alienating sellers and buyers,” Sky Canaves, principal retail analyst for eMarketer, told Modern Retail. “And often, in a very successful resale platform or a very sticky one, your buyers and sellers are the same people… If [platforms] push the wrong buttons, they can potentially impact the other side of the equation.”

Lowering fees for some, but not all

One of the most common fee changes that platforms made in 2024 was to eliminate selling fees. As Canaves pointed out, “one of the most appealing draws for sellers is lower commissions,” and a 0% selling fee means sellers get to keep a greater portion of their sales.

Mercari, for instance, made this change in March for its U.S. sellers only (it also operates in Japan). Previously, Mercari charged sellers a 10% fee for every sale made on the platform. In March, Mercari’s U.S. CEO John Lagerling said the company wanted to “make it obvious [for people] to use Mercari for their transactions” and thus reduced the fee to 0%.

Meanwhile, in July, Depop removed its fee for U.S. sellers — previously 10% of the total sale price — for newly listed items. In October, eBay removed selling fees for private sellers in the U.K. for all categories except motor. It introduced a similar program in Germany in March. In a note, eBay wrote that “hundreds of thousands” of new sellers in Germany subsequently started buying on eBay and “ended up buying twice as much as buyers who don’t sell.”

Not all platforms could afford to slash their selling fees to 0%, so some decided to lower fees in general. Poshmark took this route. In October, it lowered its selling fee from 20% to 5.99% per item sold. But, in a move that’s becoming increasingly common, Poshmark started charging buyers more to offset losses from lowering the selling fee. It asked buyers to pay 5.99% per item sold. It also added an additional $1, $2 or $3 charge for both buyers and sellers, depending on how much an item sold for.

Immediately, the backlash was swift. “I’m telling you right now, the ‘protection fee’ is going to destroy Poshmark because buyers are going to leave,” one seller wrote on Reddit. The Posh Kings, who are power sellers on Poshmark, told Modern Retail that their sales dropped by double digits during the period in which the new fees took effect. Riley, another seller, told Modern Retail that October — the month in which Poshmark made these changes — was her second-lowest grossing month of the year.

After nearly three weeks, Poshmark went back to its original fee structure. In a community note, Poshmark CEO Manish Chandra wrote that the company had spoken with community members and “listened closely to [their] feedback.” “The outcome of the change did not meet our expectations and I sincerely apologize for the disruption and impact that this has had on you,” he said.

In the two months since Poshmark went back to its old structure, business has “gone back to normal,” Riley told Modern Retail. Riley ran a sale right when Poshmark switched back to the old fees. “That did help boost my numbers at the end of the month,” she said. “My theory was all the people who had not been shopping in October because of the fees would now be ready to spend.”

Still, Riley doesn’t expect rates to stay stagnant. “I wouldn’t be surprised if next year, [Poshmark raises] the 20% fee they take from each sale,” she said. “I hope they don’t, but I think if they need to bring in more money, that’s better [than] making shoppers pay a fee to shop.”

Confronting fee hikes

Conversely, some platforms have hiked fees or made other changes to boost revenue, alienating sellers.

For example, after Etsy raised transaction fees from 5% per sale to 6.5% in 2022, some sellers went on strike. “When I opened my shop about seven years ago, the fees were minimal,” one seller told Modern Retail in 2022. “But now I’m finding myself coming up short after every sale.”

Sellers also got upset with Mercari in March after it lowered its selling fee to 0%. This was because, at the same time, Mercari started allowing returns for any reason. After sellers complained, Mercari changed some of the terms. In May, Mercari said buyers could initiate a return only if there was something wrong with an item.

Now, Mercari has roiled sellers by raising fees again. Come January, it will hike its selling fee from 0% to 10%. At the same time, it will start charging buyers a new 3.6% “buyer protection fee.”

In an email to users on Dec. 9, Mercari said it realized that its current structure “wasn’t helping sellers sell more” and “ultimately negatively impacted Mercari and our community by reducing overall transactions on the marketplace.”

Under the new changes, which are on track to begin in January, some Mercari sellers say they’re hesitant to ask buyers to pay more and worry their sales will suffer. “I would much rather pay the seller fee as the cost of doing business on the platform,” one seller wrote on Reddit.

The international equation

Many of today’s resale platforms operate in multiple countries, but just because a platform changes its fee structure in one market doesn’t mean it will do so in another.

For instance, eBay eliminated seller fees for most goods in the U.K. and Germany, but it’s not working on such a plan in the U.S. or other markets, the company told Modern Retail. Likewise, in July, Depop said that it had eliminated selling fees in the U.S. and the U.K. only.

Jessica Ramírez, senior research analyst at Jane Hali & Associates, believes resale platforms in the U.S. are still trying to perfect the ideal formula when it comes to rates. Some European companies are making progress with this, she said, pointing to Vinted, a platform with 0% selling fees that is now worth some $5 billion. According to the Wall Street Journal, in France and the U.K., Vinted’s top markets, about one person in four buys or sells on Vinted. In 2023, Vinted’s revenue increased 61% year over year to €596 million.

But even Vinted doesn’t have it all figured out. As the WSJ noted, it took Vinted seven attempts to launch successfully in the U.K. It has a small presence in the U.S., but even its CEO, Thomas Plantenga, has admitted that growth is tricky. “If I knew how to unlock the U.S., I would do it tomorrow,” Plantenga told the WSJ.

“Looking at the U.S. market… even though the consumer is into the shared economy, [resale] is still catching on,” Ramírez told Modern Retail. “I think these companies are still finding the right mix, and I think even buyers and sellers are still figuring that out.”

Ultimately, with all of these changes across platforms, some buyers and sellers are getting fee fatigue. In fact, more are looking for alternatives to the usual players, eMarketer’s Canaves explained. Some people are selling goods in person to people they meet on Facebook Marketplace, while others are holding stoop sales and taking money via Venmo. (Facebook Marketplace doubled its selling fee from 5% to 10% in April, but it does not charge a fee to people who exchange goods for cash in person.)

“Particularly now, I think increasing seller fees is going to be met with resistance and outcry,” Canaves said. “Sellers tend to have a little more bargaining power overall because buyers are less likely to leave a platform en masse… Sellers have their own forums, their own communities… and sellers can go somewhere else.”