Rent the Runway seeks to broaden appeal with new monthly service |Chain Store Age
Source: Rent the Runway seeks to broaden appeal with new monthly service |Chain Store Age
Yesterday, apparel Rent the Runway company announced a new, lower-priced service to broaden its target audience:
The New York-based company on Monday announced a less costly membership option that allows women to rent four items from its website, choosing from a curated selection of everyday styles from more than 200 brands. At the end of each month, members can either send the goods back or buy them at the company’s members-only discount.The new service, called RTR Update, costs $89 a month. The company’s other membership service for everyday wear, which launched in 2016 and is called RTR Unlimited, is going up from $139 per month to $159 per month.
We always like it when we see news such as this that touches on a number of themes! The most obvious investment themes we see are Affordable Luxury, Cash-Strapped Consumer and Connected Society themes. Affordable Luxury since Rent the Runway is simply allowing women to have access to clothing brands (Luxury brands) that they might not necessarily purchase on a regular basis (Cash-Strapped, all done online and through the mail (Connected Society.)
Rent the Runway has been around for a while — since 2009 — so it’s Netflix-like model for women’s fashion isn’t anything new. But as a privately held company, we don’t get too many glimpses into its business model, so we dug right into this article on Chainstoreage.com. One thing, in particular, caught our attention was this stat from the CEO:
Our subscription business is up 125% year-over-year and is projected to triple in 2018. We’ve made clothing rental a utility in women’s lives, and I’m thrilled to be bringing the closet in the cloud to millions more women with ‘RTR Update.’”
Further on, we get another view into the on-going Clicks vs Bricks war. The simplistic view, of course, is that online shopping is killing retail and we’re going to be seeing an American landscape of empty shopping malls and strip retail centers. But then why is Amazon buying Whole Foods and opening its own bookstores? And then we have this:
In addition to its online presence, Rent the Runway operates five physical locations (New York City, Chicago, San Francisco, Washington, D.C., and Woodland Hills, California). It is looking to grow its brick-and-mortar footprint.
The old adage in retail marketing has always been that the three most important factors in success are location, location, location. In today’s multi-channel world, the definition of “location” has certainly changed. But what has also changed is that success is also dependent on tapping into other significant economic factors, which in our world we call themes. Most relevant are ones such as Affordable Luxuries, Guilty Pleasures, Cash-Strapped Consumers, Connected Society, Content is King.
