What's Happening?
Etsy has announced the sale of Depop, a secondhand clothing app, to eBay for $1.2 billion in cash. Depop, popular among Gen Z and millennials, was acquired by Etsy nearly five years ago. The platform reported approximately $1 billion in gross merchandise sales in 2025, with significant growth in the U.S. The sale allows Etsy to concentrate on its primary marketplace amidst challenges in growing its business post-pandemic. eBay plans to leverage Depop's social-forward marketplace to enhance its reach among younger consumers and expand its presence in the fashion resale market.
Why It's Important?
The transaction marks a strategic shift for Etsy, enabling it to focus on its core marketplace and potentially streamline operations. For eBay, acquiring Depop provides
access to a younger demographic and strengthens its position in the fashion resale market, a sector experiencing rapid growth. This move could enhance eBay's competitive edge against other marketplaces like Amazon and Shein. The acquisition reflects broader trends in the e-commerce industry, where companies are increasingly targeting niche markets to drive growth and innovation.
What's Next?
The deal is expected to close in the second quarter of the year, with Depop operating as a standalone brand under eBay. eBay will integrate its backend infrastructure to support Depop's operations, potentially leading to changes in fee structures and transaction processes. As eBay expands its fashion strategy, stakeholders will be monitoring how Depop's integration impacts the resale market and eBay's overall business performance. Etsy's focus on its core marketplace may lead to new initiatives aimed at enhancing buyer and seller experiences.
