The Emerging Fashion Market: A Study of Influencing Factors of Shanghai’s Second-Hand Luxury Consumers’ Purchasing Behavior with Grounded Theory

Abstract

As a representative of China’s fashion market, the second-hand luxury market in Shanghai is experiencing significant growth. To deepen the understanding of sustainable fashion consumption, this study adopts grounded theory methodology and utilizes semi-structured interviews with 40 interviewees who have purchased second-hand luxury goods. Through theoretical sampling and step-by-step coding using Nvivo12, a comprehensive model was developed, identifying five main categories of factors influencing consumer purchasing behavior in Shanghai: three external factors—store factors, product factors, and social environments—and two internal factors—benefit cognition and personal factors. Based on these factors, we propose the following managerial implications: managers should explore new digital channels to expand service chains, leveraging celebrity endorsements to promote sustainability initiatives. Additionally, broadening product sourcing channels and establishing a standardized recycling system, while enhancing the management and monitoring of high-risk products, are essential steps. Maintaining competitive pricing, high inventory turnover, and a diverse product range are also critical measures. Furthermore, the government should increase support for second-hand luxury sales in urban commerce, fostering a competitive and sustainable business ecosystem.

1. Introduction

Shanghai, as a major international metropolis, plays a pivotal role in China’s luxury consumption. Its economic development, prominent status, diverse population, and evolving consumption patterns contribute to this central role. The city is not only a key entry point for international brands but also a vibrant stage for emerging designer labels. Shanghai’s high-end commercial districts, such as Nanjing West Road, Huaihai Middle Road, and Lujiazui, host numerous flagship stores from top fashion and luxury brands. These areas are known for their upscale shopping environments and attract many fashion enthusiasts who have a strong appreciation for luxury goods. This concentration of luxury retail and its clientele highlight Shanghai’s significance in the global luxury market. The city’s luxury market is dynamic, serving as a trendsetter and influencing both domestic and international market trends. Shanghai’s mix of traditional prestige and modern luxury makes it an important destination for both established and new fashion brands aiming to enter the Asian market [1,2,3]. However, in the first half of 2024, luxury goods sales in China experienced a significant decline. In the Asia-Pacific region, where China is a key market, Gucci’s sales in the latest fiscal quarter fell by 28% year-on-year, marking the steepest decline in the region. Similarly, LVMH Group’s sales revenue in the Asian market (excluding Japan) decreased by 6% year-on-year, with its contribution to the group’s overall revenue dropping from 36% to 33%. This downturn in the Chinese market is attributed not only to the resurgence of offshore tourism but also to the advent of more innovative market models in the luxury goods sector [3].

In the post-pandemic era, the global economic landscape has undergone significant transformations, leading to changes in consumer behavior and market trends. Although economic uncertainty has led to cautious spending habits [4,5,6], there remains a lack of research examining how these behaviors specifically manifest in China’s rapidly recovering economy. Despite rising consumer confidence, the pandemic has cultivated a more pragmatic consumer mindset, with an increased focus on cost-effective purchasing options [3,7]. This shift presents an underexplored area in understanding how Chinese consumers’ attitudes toward luxury second-hand markets have evolved post-pandemic. Meanwhile, the fashion industry generates waste that is difficult to manage, and the efficient use of resources has become one of the main challenges for the fashion industry [8]. Given that the perceived value of luxury goods often surpasses their price [4,9,10], customers are increasingly open to the resale of these high-end fashion items. The rise of second-hand luxury goods stores has introduced a new, sustainable industry chain to the fashion industry [6,8,11]. The second-hand and vintage fashion market is experiencing rapid growth in China [6,12,13], with Shanghai emerging as a key hub for the second-hand luxury market, supported by the development of a substantial industrial cluster. As noted by Luo and Park [4], while Chinese consumers have traditionally viewed second-hand luxury products with skepticism, factors such as sustainability, value consciousness, and shifting perceptions of luxury have catalyzed this market transformation. This change is further evidenced by the expansion of second-hand luxury stores across first-tier cities like Shanghai, where approximately 50 such stores are currently operating, according to data from consumer review platforms such as “Dianping” and “Meituan”. These stores not only offer handbags and accessories from prestigious brands but also feature unique, rare clothing collections that reflect the heritage and craftsmanship of luxury fashion. The diverse interior designs and merchandising styles of these stores reflect the personal aesthetics and curatorial preferences of their owners. Some retailers adopt a warehouse model, which facilitates larger inventories and more efficient sales processes [1,14]. Previous studies have highlighted that second-hand luxury and vintage stores are primarily concentrated in first-tier cities like Shanghai and Beijing, where millennial consumers form a significant segment of the market [14,15,16]. Research by Xu et al. [15] and Henninger et al. [16] has shown that millennial consumers in China are increasingly embracing second-hand luxury fashion, driven by environmental awareness, the appeal of unique vintage items, and a desire for more sustainable consumption practices. Though the second-hand luxury market in China’s second- and third-tier cities remains underdeveloped, these regions hold considerable growth potential, as changing consumer preferences and increased purchasing power are expected to drive demand in the near future [4,12].

Many scholars have focused on the second-hand luxury market and conducted extensive research on the motivations behind second-hand luxury purchases. Roux and Guiot have summarized seven scales of factors influencing second-hand consumption, which can be used either separately or combined into two primary dimensions—economic and recreational—to predict internal or external outcome variables [17]. They subsequently identified four consumer segments: “polymorphous enthusiasts”, “thrifty critics”, “nostalgic hedonists”, and “regular specialist shoppers” [18]. Additionally, second-hand luxury items continue to embody significant social value and brand benefits [19]. The resale of luxury goods in the second-hand market demonstrates that these products have withstood the test of time, with their fundamental performance remaining unaffected and their quality value still intact [19]. Also, the second-hand luxury market influences luxury brands due to the extended product life cycle and the spread of the consumption of luxury products [20,21].

Current research on luxury consumption and the second-hand luxury market concentrates more on Europe, America, and other Asian countries [11,13,17,18,20,21,22,23,24], yet there is relatively little focus on Chinese market [25]. Some scholars have employed qualitative research methods, utilizing interviews to code and analyze consumer feedback. For instance, Wang et al. [24] investigated the characteristics of mass luxury consumption in the context of the COVID-19 pandemic, identifying four key dimensions: self as content, self as process, self as situation, and self in relation to others. Although their study did not exclusively focus on Chinese consumers, 19% of the interviewees were from China. Yang et al. [6] used the grounded theory to identify that hedonic value, uniqueness value, social value, functional value (including practicality, quality, and value for money), health value, and sustainable value influence purchase intentions toward sustainable luxury in the post-pandemic era in China. Although there has been some progress in developing theoretical models for second-hand consumption in China, the motivations and behaviors of Chinese consumers differ significantly from those in the more established sustainable fashion markets of Europe and North America. These differences are shaped by local cultural, social, and economic factors. For example, social acceptance significantly influences consumer behavior in China [19]. However, it remains unclear what other representative factors impact the purchasing behavior of second-hand luxury in the Chinese context.

Therefore, this research aims to answer the following questions:

(1)

What factors influence the purchasing behavior of consumers in Shanghai’s secondhand luxury market?

(2)

How do these factors specifically impact purchasing behavior in this market?

(3)

How should marketing strategies be developed to address these influencing factors?

To address the research questions, we used grounded theory to conduct qualitative interviews with consumers in Shanghai’s second-hand luxury market. Shanghai was selected for its large market, diverse consumer base, and influential role as a trendsetter. Interviews in local stores are expected to provide representative insights. This study aims to develop a theoretical framework for China’s second-hand luxury market and offer valuable insights for the re-commerce fashion market and marketers, enhancing competitiveness.

The study is organized as follows: The next section defines key concepts and identifies research gaps in second-hand luxury and purchasing behavior. The third section describes the methodology, including the interview process, coding, and saturation testing, and proposes a theoretical model of purchasing behavior. The fourth section presents the findings on influencing factors. The final section discusses the study’s contributions and implications.

2. Literature Review

2.1. Second-Hand Luxury

Second-hand luxuries are a combination of second-hand goods and luxury goods [13]. The definition of second-hand luxuries refers to luxury brand products that have already been owned by consumers and have been bought and sold from counters [22].

Historically, the “second-hand” market is not a new trade concept, but it was not systematically documented until the 20th century due to its informalization [26]. As Beverley Lemire [27] pointed out, second-hand goods do not involve the manufacturing, precision processing, or refining of raw materials, nor do they involve the sale of new goods, making it difficult to record or statistically analyze market phenomena. From a historical perspective, Weinstein [26] classified the development of the second-hand market into three phases, namely, “Emergence and Expansion”, “Decline and Stigmatization”, and “Destigmatization and Renewed Popularity”. The current resurgence of the second-hand market is closely related to the resale of luxury goods. This extends the life cycle and use value of luxury goods and also proves the economic value of second-hand luxury goods [13]. Previous discussions on luxury consumption and marketing have mainly focused on brand new luxury goods. By around 2010, research on second-hand luxury had gradually increased.

Within the research on second-hand luxury consumption, there is a focus on distinguishing between vintage fashion and second-hand fashion [11,13,28,29]. Vintage is not only old but must be fashionable; it has to be in demand and sellable [28]. Ryding et al. have clearly defined second-hand luxury fashion as encompassing all second-hand vintage garments and accessories. However, it is important to note that not all vintage products are second-hand, as some stores manufacture newly finished garments to mimic vintage styles [11]. When conducting research on the behaviors of second-hand consumers, Cervellon and Carey [13] connected nostalgia with the motivation to purchase vintage clothing, discovering that consumers who buy luxury brand vintage items tend to have higher levels of education and income. These consumers often have backgrounds in historical and artistic education, which endow them with enhanced appreciation abilities. Additionally, originality is also a critical factor driving second-hand luxury consumption, particularly among fashion-conscious consumers. The desire for uniqueness often manifests through “bargain and treasure hunting,” where consumers seek hidden designer treasures. While economic value is a significant motivator, the thrill of discovering unique items is equally influential [13,30]. Consumers’ roles gradually evolve from buyers and users to sellers. This way of achieving social role transformation through the sale of second-hand luxury goods is the added value brought by this market [31]. Compared to brand-new luxury goods, second-hand luxury items tend to have a closer relationship with consumers. The stories behind these items easily evoke emotional connections between the new owners and the products, endowing second-hand luxury goods with attributes of sustainability and frugality [22].

In China, research on second-hand luxury goods primarily focuses on the business models of sellers. Some studies have analyzed and compared the business models of second-hand chain stores in Japan and emerging second-hand luxury stores in China, highlighting the similarities and differences in their profit models [14,32,33,34]. Liu [33] found that few people in Japan directly purchase first-hand luxury goods. Instead, consumers often opt for lower-priced second-hand luxury goods to satisfy their fashion needs and desires. The sales of second-hand luxury goods continue to grow, driven mainly by the support of Japanese citizens and tourists. Shen [32] used a second-hand luxury store in Shanghai as a case study, discovering that the prevalence of counterfeit products in China’s luxury market creates uncertainties about source, color, valuation, identification, and after-sales service for second-hand luxury items. Luo and Park [4] categorized perceived risk into functional, financial, sales source-related, physiological, and psychological superstitions to explain why Chinese consumers harbor negative stereotypes about second-hand goods. In summary, research on the consumption of second-hand luxury goods in China is relatively scarce, particularly studies that consider the typical consumer of the Chinese market and the diversity of consumer groups. Nevertheless, as China’s economic center and fashion capital, Shanghai plays a leading and exemplary role in the consumption model of second-hand luxury goods. Therefore, examining second-hand purchasing behavior in this region can not only address existing gaps in the literature but also provide valuable insights for policy formulation and the standardization of market practices.

2.2. Second-Hand Purchasing Behavior

The study of second-hand purchasing behavior, as a subset of consumer behavior, is inherently goal-oriented and motivation-driven [35,36,37]. Fishbein and Ajzen first proposed the Theory of Rational Behavior in 1975 [38], initially providing a framework for analyzing how attitudes shape individual behavior. However, this theory faced practical limitations, prompting Hill, Ajzen, and Fishbein [39] to redefine intention and behavior as tendencies influenced by personal beliefs in specific environments, with consumer intention reflecting the likelihood of future behavior. This evolution led Ajzen to further develop the Theory of Planned Behavior (TPB) [40], which posits that behaviors are generally under individual control and are rational. Stolz [20] summarized that the TPB has been applied to the investigation of shopping behavior in general, especially in the context of fashion, luxury, and second-hand luxury [41,42]. Nevertheless, the TPB faces challenges when investigating second-hand luxury purchasing due to regional variability, decision-making processes, and diverse product experiences.

In addition to the early studies using the TPB, other influential researchers have contributed to the understanding of consumer behavior. For example, Sherry’s [43] pioneering ethnographic research on flea markets revealed significant consumer behaviors, such as bargaining and social market experiences. Other research has added that social structural factors and individual cultural factors can indirectly lead to differences in purchasing behavior [44,45]. Tu’s [10] research confirmed that there is indeed a positive correlation between the perceived value and purchasing behaviors. After the factors influencing second-hand purchasing behavior gradually emerged, various research models were improved. Borusiak et al. [46] extended the TPB by incorporating personal norms, responsibility, and belonging into their model, aiming to capture the complexities of consumer intentions toward second-hand products and stores.

In the technological realm, the Technology Acceptance Model (TAM) has played a crucial role in examining second-hand purchasing behavior. The TAM emphasizes perceived usefulness and ease of use as key determinants of technology acceptance. Kim’s study extends the Technology Acceptance Model (TAM) by adding a value-based perspective through the Value-Based Acceptance Model (VAM). This model examines how perceived benefits and sacrifices impact users’ perceived value and their intention to continue using technology-based self-services [47]. Similarly, Xu extended the TAM into the Unified Theory of Acceptance and Use of Technology (UTAUT), exploring factors affecting consumer use of second-hand clothing-sharing platforms in the post-pandemic era [48].

In recent years, there have been both studies on second-hand luxury purchasing behaviors based on online consumers [49], and analysis of influencing factors through internet word-of-mouth and evaluation [50]. Calvo-Porral et al. [51] tested the conceptual model of behavioral barriers of online second-hand shopping and found that contamination effects and lack of trust toward the online store were the main obstacles, followed by product reliability and quality problems. When consumers buy second-hand products online, they are mainly motivated by environmental problems, followed by trust in online shops and economic factors, and there are also cases of online second-hand consumption that seem to be a kind of over-consumption [52].

In summary, from the perspective of research models, while the TPB and TAM provide foundational insights into consumer behavior and technology acceptance, models such as the VAM and UTAUT enhance these frameworks by addressing additional dimensions of value and usage. The TPB offers a broad understanding of behavioral intentions but may lack specificity in certain contexts, while the TAM and its extensions offer nuanced perspectives on technology acceptance, though they may need to address broader consumer motivations and barriers more comprehensively.

Although research on second-hand luxury consumption has made some progress, several key gaps remain:

(1)

Limited regional focus: Much of the existing literature centers on Western markets [11,13,17,18], with relatively little focus on second-hand luxury consumption in China [1,4,6], especially in major cities like Shanghai. As China’s economic and fashion hub, Shanghai may exhibit unique consumer behaviors that deserve more focused exploration.

(2)

Incomplete understanding of consumer behavior complexity: The behavior of second-hand luxury consumers is influenced by various factors, including cultural background, economic status, education level, and social class. Current studies often focus on a limited number of factors, failing to comprehensively address the complexity of consumer decision making [17,18,31,33]. In particular, motivations like environmental concerns, economic incentives, and brand loyalty are often insufficiently differentiated or explored in depth.

(3)

Insufficient research on consumer trust and perceived risk: While some studies have explored perceived risks in second-hand luxury consumption [4,15,25], there is a lack of research on strategies to mitigate these risks, especially concerning product authenticity and transaction security. This is especially relevant in the Chinese market, where the prevalence of counterfeit goods makes building consumer trust a critical issue.

In summary, existing research on second-hand luxury consumption falls short in terms of regional specificity, the complexity of consumer behavior, and the understanding of consumer trust. This study uses grounded theory to explore the factors influencing second-hand luxury purchasing behavior in Shanghai, aiming to fill these gaps and offer localized, practical insights. Understanding these dynamics is crucial for grasping the intricacies of consumer behavior and fostering consumer trust in this market.

3. Materials and Methods

In this study, we used grounded theory, which is a qualitative research method that offers unique advantages in exploratory research. Research on consumer purchase behaviors regarding sustainable luxury is still in its early stages, which justifies the use of qualitative inquiry [53]. This method employs an iterative process of data collection and analysis, systematically uncovering logical relationships within the data, and ultimately forming a new theoretical framework through three levels of induction. When the coding is completed, the saturation test is carried out and the new theory is finally formed [54], as shown in Figure 1.

Since the method was first introduced by Glaser and Strauss in 1967, other scholars have continuously expanded and refined it, applying grounded theory across various fields. Over time, it has gradually been incorporated into luxury consumption research. For instance, Millspaugh and Kent [55] used grounded theory to explain how small and medium-sized designer fashion brands co-create their brand value during internationalization. Pankiw et al. [56] explored how luxury jewelry brands communicate their corporate social responsibility efforts in advertising. Among the topics related to this study, Yang et al. [6] utilized grounded theory to analyze sustainable consuming behaviors in post-pandemic China. In summary, these studies using grounded theory to explore luxury consumption have yielded significant insights, providing a valuable foundation and reference for this study’s exploration of second-hand luxury consumption in the Shanghai region. However, there is a notable lack of research combining grounded theory with second-hand luxury consumption, particularly in the context of the Chinese market. Consumer purchasing behavior is influenced by various factors, and there is no mature, unified perspective on the factors driving the purchase of second-hand luxury goods in China. The grounded theory offers significant advantages in the generation of theories within the fields of marketing and consumer behavior [57,58]. Therefore, this study systematically coded and analyzed interview content to develop a new theoretical model, addressing the need for exploratory research in this domain.

3.1. Data Collection

Data used by grounded theory are mainly collected from three sources: ethnography [59], in-depth interviews [60], and textual analysis [61]. This research used in-depth interviews. To ensure that the interview content objectively and comprehensively reflected the research questions, we employed theoretical sampling in our data collection [57,58,59]. The process was as follows: First, we invited participants, who needed to meet the following four criteria: (1) the interviewees should have a basic understanding of the concepts and definitions related to luxuries and second-hand luxuries; (2) the interviewees should have concern for and interest in Shanghai’s second-hand luxury stores, and either intend to purchase or have previously purchased second-hand luxuries; (3) the selection of interviewees was not limited by factors such as gender, education, affiliation, etc., so as to ensure the authenticity and objectivity of the research results; (4) verbal permission was obtained from interviewees to record the interviews and use the transcripts. The four criteria held equal importance; any participant failing to meet any of them was excluded [6]. Next, data analysis was conducted to identify key motivations and themes, such as price advantages and store services. Based on these preliminary findings, we adjusted the sampling criteria to explore additional motivations. Finally, data collection and analysis were iterated until no new motivations or concepts emerged, indicating theoretical saturation [57,58,59].

This study utilized semi-structured interviews, offering the flexibility to explore topics beyond the predefined interview guide [62]. While it is essential to focus on the key interview questions, maintaining flexibility to explore related topics is equally important. Grounded theory emphasizes an open-ended approach to qualitative data collection, allowing themes to emerge naturally without preconceived theoretical frameworks [63,64]. Following this approach, our interview guide was structured around attribution theory, with core questions addressing the following: (1) interviewees’ interpretations of the meanings of second-hand luxury products and luxury goods; (2) the second-hand luxury items that interviewees had purchased or intended to purchase, including the history, symbolic significance, and emotions associated with buying second-hand goods, as well as the disposal of idle luxury items; (3) the channels used for purchasing, the purchasing process, and the benefits and obstacles encountered during the purchase; (4) the process of seeking profit, and a comparison between purchasing new and second-hand goods.

We conducted the interviews both face-to-face and via telephone, with interview durations ranging from 18 to 36 minutes. We fully acknowledge the potential differences that may arise between face-to-face and telephone interviews. However, previous research on qualitative methodologies supports the validity of telephone interviews. Stephens [65] noted that telephone interviews also enabled a far greater degree of control for the participants than a face-to-face interview may have. Furthermore, studies have shown that telephone interviews can yield results just as valid as those from face-to-face interviews, particularly when the focus is on the content of responses rather than the interactional dynamics [66,67]. These findings reinforce our confidence in incorporating telephone interviews as a key part of our data collection strategy.

Based on the four core question frameworks mentioned above, we visited six second-hand luxury stores in Shanghai from 15 June 2023 to 21 June 2023. These stores included five boutiques featuring high-end luxury items from brands such as Hermès and Chanel, primarily selling handbags, accessories, and ready-to-wear items of high quality, including new and nearly new products. There was also a large warehouse-style self-service store offering a wide range of brands and products in varying conditions. To avoid disrupting customers’ shopping experience, we first inquired with the store staff about the possibility of speaking with customers. After obtaining their approval, we selected customers who met the four interviewee selection criteria and conducted face-to-face interviews with them. Additionally, at the end of June 2023, we recruited more qualifying participants and conducted follow-up telephone interviews. Finally, to achieve gender balance among respondents, nine male participants were included in the interviews conducted between 8 August and 15 October 2024, resulting in an equal number of male and female respondents. Grounded theory emphasizes the flexible and iterative nature of data collection, allowing for interviews to be conducted at different points in time to enhance the richness and depth of the data [68,69,70]. This method involves continuously engaging with the data as they emerge, adjusting sampling based on theoretical insights, and ensuring comprehensive coverage of the phenomena under study.

This research was conducted according to the guidelines of the Helsinki Declaration and has been reviewed and approved by the Ethics Committee of Jiangnan University, Reference Number: JNU202406RB047. To address potential issues such as ambiguous wording and extended interview durations, we conducted a preliminary investigation. This included initial interviews with three researchers experienced in purchasing second-hand luxury goods and two customers from the stores. Such preliminary interviews are recognized as crucial for refining interview protocols and enhancing the clarity of questions [70]. Following the formal interviews, a theoretical saturation test was carried out with five additional participants to ensure that no new influencing factors emerged and to affirm the completeness of our data [69]. This method of saturation testing is crucial for ensuring that the final theoretical framework is robust and well-supported by the data [54,68]. A total of 40 transcripts were collected and translated into English, with detailed demographic information presented in

Table 1. Interviewees’ demographic information.

	General Information	Number	Percentage
Gender	Female	20	50.0%
	Male	20	50.0%
Age	18–20	4	10.0%
	21–25	14	35.0%
	26–30	17	42.5%
	31–35	3	7.5%
	36–40	2	5.0%
Occupation	Student	8	20.0%
	Financial industry	4	10.0%
	Fashion/creative industry	11	27.5%
	Education industry	2	5.0%
	Media/new media industry	5	12.5%
	Internet industry	3	7.5%
	E-commerce industry	3	7.5%
	Freelancer	4	10.0%

. The results indicate that the gender ratio among the survey respondents was balanced, each accounting for 50%. The largest age group represented was 26–30 years, accounting for 42.5% of the interviewees, followed by the 21–25 age group, which made up 35%. Additionally, participants working in the fashion and creative industries formed the largest segment at 27.5%, followed closely by students, constituting 20% of the sample.

3.2. Open Coding

With the assistance of Nvivo 12, a line-by-line analysis was conducted on all original transcripts, while excluding any ambiguous or irrelevant statements. We obtained 501 original sentence labels and, after merging and conceptualizing the labels, 55 concepts were extracted. Within these concepts, 21 sub-categories were further summarized, and the results are shown in

Table 2. Open coding results.

No.	Sub-Category	Concept	Examples of Raw Statements
1	store service	professional guidance, relaxed atmosphere, after-sales service, no regional discrimination	1. The sales assistants are professional. They are very familiar with all kinds of products (I2). 2. If I don’t like it anymore, the store can recycle it (I3). 3. The sales assistants in second-hand shops have no regional discrimination (I9).
2	operation norm	professional team training, comprehensive appraisal process, online and offline operations, diverse product sourcing channels	1. Shanghai’s second-hand luxury stores basically have several WeChat accounts for us to contact, which is really convenient for me (I29).
3	interior and exterior decoration	exquisite store decorations, well-organized visual merchandising	1. The stores put the same type of bags together like an exhibition, but they will not feel as remote as the luxury boutiques (I10). 2. Some store owners have a unique style of selecting products. I can make friends with the same taste here (I6).
4	store evaluation	high rate of online reviews, recommendations from people, high repeat-purchase rate	1. I knew it from a post on “Xiaohongshu”. It is a must-go store in Shanghai (I1). 2. I have bought from “ZZER” several times. This store has a high rate of online reviews (I25).
5	marketing strategy	promotional activities, points rewards, festival special offers and discounts	1. This store sometimes has promotional activities, and it is easy to buy products with nice prices (I8). 2. Once I bought a discounted necklace on Women’s Day (I30). 3. Yesterday was Chinese Valentine’s Day, and my girlfriend sent me a picture of a bag she really likes that’s being sold in a store. It was much cheaper than the retail price (I34).
6	image enhancement	aesthetic, personal image cultivation, Thrifty Fashionista, Environmentalist	1. I always take a photo or a screenshot of the product then send to my friend. They all recognize my taste (I9). 2. I can find a fancy bag with a lower price in these stores (I2, I10, I23). 3. The topic of sustainability is very popular now, and many brands are promoting this concept. Buying and selling these second-hand luxury goods is also a good method (I32). 4. It’s definitely great to be mindful of the environment (I34).
7	desire for uniqueness	unique buying experience, passion for archival products, heightened consumer interest	1. Most of the products are selected by the shop owner; some of the products only have one piece (I1). 2. I like the process of exploring the archives, because it symbolizes more characteristics of the designer. These collections raise my interest in spending money (I3).
8	fashion influencers’ following	imitation of fashion icons, designers, and artists	1. I like the actress Carrie in “Sex and the City”. She used this Fendi bag a lot (I23). 2. For example, my mother likes Takashi Murakami’s works very much, so I bought a crossover Louis Vuitton bag for her from a second-hand shop (I26).
9	social status	personal income, educational background, investment perspective	1. Buying second-hand luxury is like archaeology for me. It seems like an investment; also, it can bring real benefits (I3).
10	taste	aesthetic preference, appreciation of vintage products	1. My preferences change with my age (I11). 2. In the past, I was not able to accept second-hand things—the touch and smell were not very good–but now I feel that some of the vintage products are special (I21).
11	psychological desire	reducing fashion stigma, need for affordable luxury, first-time luxury purchase attempt	1. In Shanghai, you can wear anything you like (I17). 2. I saw a Chanel bag in a store on Anfu Road. The price was one-third lower than the counter. That is very attractive to me (I25). 3. I bought my first luxury item at a second-hand luxury store because I felt too self-conscious to go directly to the retail counter. After that experience, I no longer felt intimidated when shopping at the retail counter (I33).
12	previous purchasing experience	purchase frequently, first purchase experience	1. I enjoyed shopping in this kind of store when I was studying in UK. Now I have come back to China, I prefer to choose stores in Shanghai (I4). 2. I have been watching for a long time. Today is my first time visiting the store offline (I22).
13	product scarcity	one-of-a-kind items, attraction of limited editions	1. Once I bought limited edition Chanel coat at “Allot Vintage”. Many of my friends asked me where I bought it (I26).
14	product quality	authenticity guarantee, various categories and styles	1. We do not have to worry about the quality because all products here have been through authenticity identification (I1). 2. There is a penalty of three-for-one fake policy (I2).
15	product turnaround	high frequency of inventory turnaround, seasonal product synchronization	1. The products in the luxury boutiques update quickly by season. Many styles will be out-of-date in the second year (I24). 2. I feel that the seasonal luxuries can be found in the second-hand luxury store quickly (I27). 3. Some products may be out of stock in the flagship stores, but we can find them here (I28).
16	product price	preferential pricing, lower price compared to flagship stores	1. It was the newest style but still about 5000 yuan cheaper than in the luxury flagship stores (I17).
17	brand effect	stores with high fashion expertise, stores with high credibility, stores with mature supply chains	1. The second-hand luxuries have their own brand value. I do not need to worry about devaluation (I3). 2. Now there are several well-known second-hand luxury stores in Shanghai, such as “Aloooooha”, “Ami”, and “Hana Vintage” (I26).
18	urban cultural atmosphere	urban lifestyle, rise of second-hand culture	1. Recently, I found lots of fashion bloggers in Shanghai sharing their shopping experiences on social media (I28). 2. Citizens in Shanghai like to wear pieces incorporating unique textures and details (I18).
19	fashion industry cluster	clusters of similar stores, well-developed fashion industry	1. These shops gathered near Xintiandi (a shopping area) only sell Hermès bags (I26). 2. There are many shopping malls in Shanghai where loads of international brands are gathered (I5).
20	social acceptance	social circle acceptance, strong public acceptance, fashion recognition from strangers, confidence in second-hand consumption	1. My colleagues and friends show positive attitudes to the current second-hand luxury market, so I do not feel ashamed to buy second-hand things (I27). 2. A stranger came up and asked me where to buy my bag. That made me feel honored (I26).
21	social media	New media influence, internet communication	1. I rely on online reviews (I1, I8, I10, I12). 2. “Xiaohongshu” or “Tiktok” will brush up on some stores because of the positive comments (I9).

.

3.3. Axial Coding

This process involves repeatedly comparing various labels, concepts, and categories obtained through open coding to uncover hidden relationships between them. Ultimately, the categories are aggregated into main categories. From the 21 sub-categories identified through open coding, five main categories were constructed to characterize the influencing factors of consumers’ purchasing behavior in second-hand luxury stores in Shanghai. These main categories were store factors, benefit cognition, personal factors, product factors, and social environments. The connotations of these main categories, along with the coding process, are detailed in

Table 3. Axial coding results.

Main Category	Sub-Category	Meaning
store factors	store service	Including the professionalism of the store’s personnel, after-sales service, and shopping atmosphere.
	operation norm	This considers the store’s management and operation mechanisms.
	interior and exterior decoration	The interior and exterior decoration of the store, along with the display of merchandise.
	store evaluation	Consumer evaluations of the store, both online and offline.
	marketing strategy	Various promotional methods are employed to stimulate consumer purchases.
benefit cognition	image enhancement	Consumers purchase second-hand luxury products to enhance their personal temperament, aesthetics, affordability, and sustainable and environmental awareness characteristics.
	desire for uniqueness	The stores provide access to rare goods and cater to special aesthetic needs.
	fashion influencers’ following	The stores provide consumers with the same style as their idols.
personal factors	social status	Including the consumers’ economic income, educational background, and investment perspectives.
	taste	Changes in personal aesthetic preferences and an appreciation of vintage products influence purchasing decisions.
	psychological desire	The store meets consumers’ fashion needs with good quality and low prices.
	previous purchasing experience	Consumers have experience buying products in second-hand luxury stores.
product factors	product scarcity	Unique and limited-edition items are particularly attractive.
	product quality	The authenticity of products is guaranteed, with sufficient variety in color and texture.
	product turnaround	Products are launched quickly, meeting high customer demand.
	product price	Prices in Shanghai’s second-hand luxury stores are competitive compared to other platforms.
	brand effect	The values of luxury brands and the second-hand luxury stores themselves.
social environments	urban cultural atmosphere	The commercial atmosphere, lifestyle, fashion demand, and acceptance of second-hand consumer culture in Shanghai contribute to the market growth.
	fashion industry cluster	Shanghai’s fashion and luxury industries are well-developed, with second-hand luxury stores reaching certain scales and forming clusters.
	social acceptance	Shanghai residents have a high acceptance of second-hand luxury goods and are inclusive of fashion trends.
	social media	Digital-era communication channels support the prosperity and development of Shanghai’s second-hand luxury market.

.

3.4. Selective Coding

This process was the final step in this study, in which the core category was connected to the main categories obtained in the previous coding circular. The core category represents the central outcome. In our research, the core category was determined as the influencing factors of Shanghai’s second-hand luxury consumers’ purchasing behavior.

It is necessary to list the influence path, relational structure, and the connotations between the core category and each main category; the details are shown in

Table 4. Selective coding results.

Influence Path	Relational Structure	Relational Structure Connotations
store factors → purchasing behavior	influence relationship	The store’s service, operation norms, internal and external decoration, evaluation, and marketing strategy directly influence the purchasing behavior.
benefit cognition → purchasing behavior	influence relationship	Consumers’ perception of image enhancement, uniqueness needs, and imitation of fashion influencers directly influence their purchasing behavior.
personal factors → purchasing behavior	influence relationship	Consumers’ social status, taste, psychological desire, and previous shopping experiences directly influence their purchasing behavior.
product factors → purchasing behavior	influence relationship	The scarcity, quality, turnaround, price, and the brand effect of products directly influence consumers’ purchasing behavior.
social environments → purchasing behavior	influence relationship	Shanghai’s urban cultural atmosphere, industry clusters, social acceptance, and social media directly influence consumers’ purchasing behavior.

. The results indicate that the following five main categories are the significant influencing factors.

3.5. Saturation Test

It is necessary to test the theoretical model after previous coding procedures. To further verify the credibility of the theory, the data need to iterate until reaching theoretical saturation, namely, no new categories obtained, and we aimed for theoretical saturation. The authors randomly selected 5 samples from preserved raw data for testing. After repeating the previous coding steps, neither new categories nor new relationships were found. Therefore, it can be concluded that the influencing factors of second-hand luxury consumers’ purchasing behavior in Shanghai are theoretically saturated.

4. Results

Utilizing three levels of coding, this study developed a comprehensive factor model of consumer purchasing behavior in Shanghai’s second-hand luxury market, addressing both external and internal factors. The analysis was conducted across four dimensions: product, store, customer, and environment. These dimensions encompass five main categories (Figure 2). The five main categories in the model are detailed below.

4.1. Store Factors

In the store dimension, a series of store-related operations serve as the foundational elements that promote the consumption of second-hand luxury goods in Shanghai. The store factors are comprised of five sub-categories: store services, operation norms, internal and external decoration, store evaluation, and marketing strategy.

The exceptional service of the sales staff cultivates strong trust among customers. Research has shown that regional discrimination is a prevalent issue in major Chinese cities like Shanghai, particularly affecting non-local residents [71]. This bias often manifests in luxury retail environments, where customers from other regions may face unfriendly attitudes from local sales staff. Five of our interviewees echoed these findings, reporting similar experiences in traditional luxury stores. However, they noted that second-hand luxury stores in Shanghai provide a more welcoming atmosphere, with sales personnel offering a high level of service and professionalism, which fosters consumer trust.

Shanghai’s second-hand luxury stores have developed a unique operational norm that emphasizes customer service and product longevity. Approximately 25% of respondents noted that stores in Shanghai assist with reselling previously purchased items, particularly handbags and accessories. By offering services such as price estimation, product authentication, and repair and cleaning, these stores enhance their brand value in the second-hand market. This approach not only increases trust in the product’s quality but also strengthens relationships with customers who buy to sell and sell to buy, fostering a loyal client base [29,31,53].

Shanghai’s second-hand luxury stores prioritize both interior and exterior design to create a high-end shopping experience. When visiting the five boutique second-hand luxury stores in Shanghai, each store’s interior design and visual merchandising reflected the unique tastes of the owners. The store “Ami vintage” favored clean, bright displays, enhancing the visibility of handbags on wall-mounted shelves, allowing customers to easily view the items. Both “Hana Vintage” and “Hihi Vintage” have created a cozy, retro-inspired interior design, with displays placed close to customers, allowing them to easily pick up and evaluate products at their leisure. This personalization in store decoration and product placement not only enhances the shopping experience but also deepens customer engagement, encouraging tactile interaction with the products while maintaining a luxurious ambiance [33,34].

Currently, the evaluation of second-hand luxury stores in Shanghai primarily comes from online platforms and offline word-of-mouth, both of which directly influence consumer purchasing behavior. Nearly all interviewees reported that they would first search online for information about the stores they plan to visit. Furthermore, word-of-mouth from friends, family, and fellow luxury buyers also significantly influences their choices. These combined factors create a comprehensive understanding of a store’s trustworthiness and product quality, which directly impacts purchase behavior.

The store’s marketing strategy plays a crucial role. During one of the interview sessions, which coincided with the Qixi Festival (Chinese Valentine’s Day), a male respondent (I34) noted that many stores were conducting promotions on that day. Additionally, these stores would send out mass online messages to inform consumers about the holiday events. Also, sales assistants in second-hand luxury stores in Shanghai often use livestreaming on popular social media platforms to promote products. (When we interviewed in boutique stores “Alooooooooha vintage” and “Hana vintage”, we found that the staff members engage in livestreaming on a daily basis.) During these live sessions, they display the products on models and interact with customers in the comment section. Moreover, the interactive and immersive nature of livestreaming enhances customers’ engagement, thereby significantly influencing purchasing behavior [14].

4.2. Benefit Cognition

In Maslow’s hierarchy of needs theory, self-actualization represents the highest level of needs [72]. The research findings indicate that consumers of second-hand luxury goods often experience fulfillment, satisfaction, and personal development closely associated with self-actualization. Therefore, benefit cognition stands as a pivotal element within the customer dimension. Benefit cognition encompasses three key sub-categories: image enhancement, desire for uniqueness, and fashion influencer following. Notably, benefit cognition not only drives purchasing decisions but also receives reinforcement and refinement through subsequent consumer behaviors.

The enhancement of personal image is often influenced by the judgments of friends and family. By purchasing second-hand luxury goods, consumers receive recognition from their social circles throughout the selection and purchasing processes. This external validation of personal aesthetics and appreciation abilities helps consumers better shape their self-image [6,11]. One-third of the interviewees highlighted a common phenomenon: their friends and family consider them as key opinion leaders; receiving praise and compliments is crucial to them. Meanwhile, opting for second-hand luxury earns them the title of “Thrifty Fashionista” and “Environmentalist” [1,11,16]. Nevertheless, only five respondents highlighted the benefits of sustainable fashion, and these respondents were primarily individuals with educational and professional backgrounds in the fashion and creative industries.

“Uniqueness” is one of the important factors in second-hand luxury research [1,6,16,22]. The core of this purchasing behavior is in treasure hunting and the meanings of personality attached to second-hand goods that refer to the scarcity of the discovery [73]. During the interviews, one-third of the participants indicated that they derive satisfaction from seeking or purchasing discontinued limited-edition and classic luxury items to fulfill their unique needs. This finding aligns with previous research conducted in various regions, which suggests that exploring archival products enhances their purchasing interest [1,6,11,13].

Moreover, the market offers consumers a means to emulate fashion influencers, notably through stores highlighting celebrities with similar styles or brand ambassadors. For example, during an interview in the store “Alooooooha vintage”, an interviewee (I23) said that “I enjoy watching ‘Sex and the City’, the role of Carrie is my fashion muse, so I bought a Fendi baguette just like Carrie’s”. Three interviewees also expressed their willingness to use the same style as celebrities or idols. This proved that when fans cannot directly interact with their idols, they often establish an indirect relationship through the collection of symbolistic items [74]. Approximately 40% of respondents expressed strong admiration for fashion bloggers. The second-hand shops in Shanghai that were recommended by these influencers, along with the specific items they highlighted, have become popular choices among interviewees. The advantage of second-hand luxury for such consumers is to achieve fashionable imitation of their idols at a more affordable price. Pursuing stars provides emotional support, spiritual solace, direction, and helps in self-formation and identity [75]. Salimi et al. [76] also demonstrated that the alignment between ideal self and brand personality significantly influences consumer emotional attachment. Therefore, effectively leveraging the relationship between fashion idols and second-hand luxury goods can harness the celebrity/idol effect to attract customers.

4.3. Personal Factors

Consumers’ growing preference for second-hand commodities stems from motivations such as originality, nostalgia, self-expression, and personal style presentation [13,30,71,77]. Our study found that personal factors influencing purchasing behavior include social status, taste, psychological desires, and previous purchasing experience. These preferences, however, are subjective and shaped by prior experiences.

Social status is primarily reflected in consumers’ economic income, educational background, and investment perspectives. Previous studies have identified economically capable young individuals as the main customer base in the second-hand luxury market [24]—a trend also observed in our interview process. Among our respondents, 92.5% held a bachelor’s degree or higher. This demographic has a certain budget capacity for purchasing second-hand luxury goods and views such purchases as a reflection of their economic status. Economic income and education not only affect purchasing power but also shape consumer taste and desires [9,15]. Our interviewees from the finance and fashion industries emphasized the investment value of high-end second-hand items. This phenomenon is partly attributed to the increasing acceptance of vintage products among Chinese consumers [6,13]. In total, 35% of respondents mentioned their international travel or study experiences, which exposed them to vintage culture and allowed them to better understand the historical and collectible value of second-hand items.

This exposure to vintage culture and high-end second-hand goods has, to some extent, elevated the respondents’ taste. During our interview, a respondent stated, “My preferences change with my ages” (I11). This highlights the evolving nature of aesthetic preferences. Appreciation for vintage and second-hand luxury products often aligns with maturity and an increased awareness of cultural and historical value. Personal experiences and evolving tastes contribute to a deeper recognition of the craftsmanship and uniqueness of second-hand luxury items. These elements are key in shaping consumer taste within Shanghai’s second-hand luxury market.

Psychological desires also play a key role. In Shanghai, second-hand luxury stores help alleviate the “fashion stigma” by creating an environment where personal expression is celebrated without judgment. Interviewees (I12, I15–I17, I19, I23) highlighted how Shanghai encourages unique clothing choices, allowing stores to adopt more daring product selections. The history and “story” behind pre-loved items also evoke strong emotional connections between the items and their new owners [22], fulfilling consumers’ psychological needs.

As previously mentioned, respondents’ engagement with second-hand and vintage culture stemmed from their past purchasing experiences. Twelve respondents shared positive and novel shopping experiences in cities like Tokyo, Paris, and London, which deepened their appreciation for and interest in second-hand luxury items. These experiences influenced their aesthetic preferences, making second-hand shopping in Shanghai more appealing. Additionally, a quarter of the respondents emphasized the importance of a positive first-time buying experience in second-hand luxury stores, as it directly impacted their willingness to continue purchasing such products. Therefore, the findings of this study confirm that past purchasing experiences significantly shape consumers’ perceptions and satisfaction with second-hand luxury goods [12,25].

These personal factors contrast with objective criteria by emphasizing subjective experiences and emotions. They show how personal motivations, shaped by individual perceptions and cultural contexts, drive engagement in the second-hand luxury market. Both personal factors and benefit cognition, as internal drivers, are key components of our model, warranting separate discussion.

4.4. Product Factors

Product factors are the most direct external stimuli encouraging purchases. Second-hand luxury items must offer practical functional benefits to stimulate consumers’ buying desires. Product factors, including scarcity, quality, turnover, price, and brand effect, directly influence consumer purchasing behavior.

The hypothesis of resource scarcity is a cornerstone of modern consumption theory. Only when resources are scarce do consumers need to reasonably allocate their consumption to maximize utility and increase their attention to the product [78]. The scarcity of products amplifies their perceived uniqueness, driving consumers’ desire to purchase, as they often seek distinctiveness to differentiate themselves from others [13,16,31]. Ms. X (I28) stated, “Many of the bags in this store have been out of production for many years and can not be found elsewhere”.

Product quality such as authenticity guarantees and the diversity of product shapes, colors, and textures were crucial factors for interviewees. High-quality products meet consumers’ dual needs for practicality and aesthetics and are essential for enhancing a company’s market competitiveness and establishing a strong reputation for quality [1,3,11,79].

The speed of product turnaround and the assurance of sufficient supply ensure that consumers continually experience novelty, satisfying their need to keep up with fashion trends. Existing research has demonstrated that the frequency of product updates is viewed as a key factor in enhancing a company’s competitiveness and sustaining its long-term development [80]. In our study, an interviewee (I3) indicated that the turnaround of products in Shanghai’s stores is higher than other cities like Chengdu or Guangzhou.

The interview results validated that the stores meet consumers’ demand for high-value products with price advantages [1,2,11,53]. All respondents mentioned, to varying degrees, the attraction of price advantages. As one interviewee noted, “I prefer to buy nearly-new, unused products because they are always much cheaper than in flagship stores” (I37). This highlights how the substantial price difference between second-hand and brand-new items serves as a strong incentive for consumers to shop at second-hand luxury stores, particularly when the products are of comparable quality.

Finally, the brand effect within product factors is not only reflected in the inherent brand value of the goods themselves but also in the value of the stores. A well-established business model and aesthetic appeal of the merchandising contribute significantly to the store’s self-worth. The strong brand image significantly promotes consumers’ purchase willingness [14,81].

4.5. Social Environments

Social environments influence purchasing behavior through urban cultural atmosphere, fashion industry clusters, social acceptance, and social media. Our study showed that Shanghai is an inclusive city, and the high acceptance of second-hand goods by society reduces psychological barriers for consumers [1,32,71].

Cultural capital theory posits that the accumulation of cultural capital can be transformed into socio-economic capital. The cultural atmosphere of a city profoundly influences luxury consumption, particularly in cities with international fashion status [82]. Shanghai’s large expatriate population attracts consumers from diverse cultures to the second-hand luxury market. The high concentration of the fashion industry offers consumers a wide range of product choices, which fosters competition and development of the re-commerce fashion market.

The theory of clusters suggests that the geographical concentration of the same or related industries is conducive to knowledge sharing, resource integration, and market competitiveness [83]. Our interviewees (I1-I4, I8, I15, I20–I22) believe that some second-hand fashion districts in Shanghai are conveniently located next to major shopping malls, which is one of the main reasons they frequently visit these areas. Thirdly, four out of five respondents demonstrated a high level of acceptance and inclusivity toward second-hand fashion, indicating the market’s strong social and cultural approval. According to the integrative theory [84], individuals derive a positive self-concept through their group membership. McCracken pointed out that goods are not just material objects but also carry cultural meanings and social values [85].

In the digital era, social media and e-commerce platforms have enhanced the flow of information and the prosperity of Shanghai’s second-hand luxury market. Media not only directly influence consumers but also indirectly impact them through opinion leaders on social media [86]. Eighty percent of interviewees use platforms such as “Xiaohongshu” and “Tiktok” to search for information about second-hand luxury and stores, with recommendations on these platforms significantly affecting their purchasing decisions.

5. Discussion and Implications

This study used grounded theory to examine second-hand luxury consumption in Shanghai and identified five key factors influencing purchasing behavior: store factors, benefit cognition, personal factors, product factors, and social environments. The following discussion summarizes the findings and their implications.

Among store factors, high-quality service and standardized operations are essential for building consumer trust in the second-hand luxury market, where authenticity is paramount [11,14,25]. Firstly, to enhance consumer confidence and engagement, stores should maintain high standards, explore innovative marketing strategies like livestreaming, and consider expansion to platforms such as overseas TikTok. Additionally, offering resale services promotes the circular economy by facilitating the reuse of luxury goods, thus creating added value for consumers. Second-hand stores are evolving beyond simple retail platforms to become integral components of the circular economy, fostering long-term customer relationships. For market managers and brand operators, expanding the service chain and exploring new digital channels are crucial strategies for enhancing customer loyalty and satisfaction.

Under the benefit cognition category, respondents in this study provided feedback on image enhancement that differs from other second-hand consumption studies emphasizing sustainability [11,87]. Sustainability is not a primary purchase consideration; instead, it is a concept of the sub-category of image enhancement. This finding supports that young Chinese consumers are mainly driven by entertainment and the “treasure-hunting” experience, rather than economic or environmental motivations [19]. Additionally, following fashion influencers was found to be particularly appealing to respondents. Considering the three sub-categories of benefit cognition, market managers can first emphasize promoting environmental sustainability in second-hand luxury consumption, integrating sustainability into marketing strategies to attract more environmentalists as potential consumers, enhancing the understanding of the luxury product lifecycle, and minimizing fashion waste [6,11,87]. Secondly, in terms of product selection, managers can broaden channels for sourcing rare items, such as engaging private sellers or sourcing from overseas cities. Lastly, leveraging resources like celebrities, idols, and fashion bloggers can help enhance store promotion—for example, inviting fashion influencers to feature unique items sold by the store in short videos on their personal accounts.

Personal factors such as previous positive experiences with second-hand luxury shopping abroad influence consumer expectations in Shanghai. Twelve interviewees expressed positive attitudes toward their second-hand luxury shopping experiences abroad. Four interviewees noted the superior store displays and customer service in Japan, which have influenced their expectations for Shanghai’s second-hand luxury market. Markets in mature regions like Japan and Europe, such as Tokyo, Paris, and London, shape these expectations [1,14], despite Shanghai’s growing but still developing market. To foster the further growth of the market in Shanghai, it is essential to align store operations and regulations with the preferences of Chinese consumers. Conducting surveys to understand brand, product category, and style preferences can help stores better meet local demand and boost customer satisfaction. Establishing a standardized recycling system and improving consignment sales processes can build consumer trust. Additionally, strengthening regulations to address high-risk products, such as refurbished or recolored items, will enhance transparency and reliability. By adapting to these needs, practitioners can improve engagement and support the growth and sustainability of Shanghai’s second-hand luxury market.

Product factors reveal that price is a significant competitive advantage in China’s developing market, especially given post-pandemic economic changes [88]. As luxury prices increase, the second-hand market’s affordability becomes a key draw. Interviews indicate that a quarter of respondents favor nearly new items at lower prices, highlighting the importance of affordability. To leverage this price advantage, it is crucial to emphasize the affordability of high-quality, lightly used luxury goods. In Shanghai, where consumers are increasingly price-sensitive but still desire premium products, targeting budget-conscious shoppers with competitive pricing will be vital for success. Additionally, maintaining high inventory turnover and offering a diverse range of on-trend products will sustain consumer interest. Regularly updating inventory with a variety of styles can differentiate Shanghai’s second-hand luxury market, attracting both trendsetters and those seeking unique items.

Shanghai’s social environments are favorable for the growth of second-hand luxury fashion. To enhance this potential, we suggest several measures. Firstly, the government should support the integration of second-hand luxury goods into the broader fashion culture. Initiatives such as creating fashion culture exhibition zones or hosting international fashion events could increase the visibility of second-hand luxury items. Secondly, strategic urban planning and policies, including tax incentives and resource support, could attract more professionals and trading platforms to commercial hubs, fostering a competitive business ecosystem and broadening consumer options. Additionally, policymakers should collaborate with brands and influencers on social media platforms like Xiaohongshu and TikTok to promote environmental sustainability and responsible consumption. This could help reshape public perceptions and encourage the growth of second-hand luxury fashion.

This study is an initial attempt to apply grounded theory to Shanghai’s second-hand luxury market. Existing literature on second-hand luxury purchasing behavior primarily compares cross-cultural consumption among younger consumers [15] or focuses on case studies in mature markets such as the UK [28,29], Korea [5], and Europe [6,13]. Additionally, studies have explored brand image perception, sustainability, and materialism in the purchasing decisions of Millennials [16] and Generation Z [23]. This study, however, fills a gap in the literature by constructing a theoretical model based on the Chinese developed city market, offering new insights into this specific context.

However, there are some limitations to this study. Firstly, although theoretical saturation was achieved through interviews with 40 participants, the sample may not fully capture the diversity of the consumer group. Future research could expand the sample size to include consumers from varied backgrounds, such as different ages, income levels, and occupations, to enhance the external validity of the findings. Also, considering regional heterogeneity, a cross-regional comparative study in China could be conducted. Secondly, this study did not explore gender differences in depth. While both male and female perspectives were mentioned in some interviews, the impact of gender on consumption behavior was not thoroughly examined. Given that gender differences may influence purchasing decisions in the luxury market, future studies could conduct a more focused analysis to investigate potential gender-based differences. Moreover, this study employed a qualitative approach without incorporating quantitative methods. Future research could adopt a mixed-methods approach, combining qualitative and quantitative analyses. The inclusion of quantitative data could provide a clearer understanding of the specific factors influencing consumer behavior and further validate the findings within this grounded theory framework. Beyond contributing to the theoretical framework, we hope this research also aids managers in revitalizing the sustainable fashion market from a more localized perspective.