The Netflix model of having access to items rather than owning them has been applied to dozens of industries, and Millennials are among the biggest adopters of this ever-growing trend. They don’t care as much about owning everything — whether it’s music, TV shows, or luxury dresses — as long as they can obtain these things when they need them. This mindset is what changed the music industry — YouTube is now the top way in which teens listen to music — and this attitude is influencing marketers who want to tap into Millennials’ purchasing, or rather renting, habits.
Rent the Runway isn’t new, but many female Millennials are continuously turning to it when they need a dress for a special occasion. Whether it’s prom, a school formal, their birthday, or graduation, teens and twentysomethings know that this method allows them to wear their dream dress at a more affordable price. This is valuable in that special occasion dresses aren’t worn often, and they can be pricey for something that then collects dust in their closet. However, if they rent a dress, solely for the situation in which they need it, the “runway” dress becomes more attainable. This also reflects a concept in the age of social media where every outfit is photographed and shared across one’s network. Many Millennials worry about their same clothes constantly being captured on Facebook and Instagram, but renting provides a solution in the form of a temporary expanded wardrobe.
Renting apparel also taps into showrooming, another shopping trend we’re seeing in that Millennials are visiting physical stores to scope out the selection, but not buying items in-person. Rather, they’re treating stores as if they were showrooms, and then going online or comparing prices before making purchases. Rent the Runway for example coincides with this trend as Millennials may visit a store, try on a dress, and then rent it online after seeing what it looks like and how it fits.
Rent the Runway recently took their Millennial approach one step further and added Our Runway, a social shopping platform that lets consumers see user-generated images of dresses on real people that are available to rent. They can even ask the people in the pictures about the fit of the dress, highlighting their desire to get customers’ reviews. As companies cater to young people’s changing consumption habits, we’re seeing more of a focus on convenience and user-involvement.
Moreover, this concept of access as key is being applied to other areas of the apparel and beauty industry. Le Tote is a clothing rental subscription company that provides consumers with a tote full of clothes and accessories to wear for $49 a month. This taps into their desire for fast fashion since they can borrow on-trend items that are more casual than those of Rent the Runway, but still pricey to purchase. Instead, Millennials can constantly replenish their wardrobe, returning and receiving new items to stay in style. There’s even a similar service for nail polish called Lacquerous, which lets people rent high-quality brands of nail polish. They can join the subscription nail polish club and pay $18 a month to receive three designer nail polish shades. As nail art is everywhere these days and it’s some of the most shared content on social media, we can see this site catching on. Millennials can look up nail ideas, colors they want to try out, and art they want to experiment with, and switch up shades based on their mood, season, or design preference.
This increasing tendency to rent products is also seen in other industries. Zipcar is popular near college campuses and in cities where young people may not be able to afford or need a car. It’s certainly the case with entertainment as Millennials frequently tell us they can’t remember the last time they bought a DVD. Young people are even renting workspace on an as-needed basis. As young people are particularly interested in entrepreneurship, we expect to see this approach incorporated into their business models as they can access talent when necessary, without owning an office and having full-time in-person staff. Airbnb also evokes this idea, as people can rent unique spaces from others all around the world. In fact, there’s few things you can’t rent online these days as educational toys, ties, and textbooks are among the many products available for a short period of time.
This trend seems to be picking up speed for several reasons, one of which is that it allows for high-low budgeting among Millennials. They’re interested in luxury items and experimenting with style, but they can’t afford many of the expensive items that they desire. By rethinking the way to obtain them, they are essentially minimizing the cost for how often they need the products. Millennials may need to still save up to rent a designer dress, but this way, they’re not putting all their funds towards owning one thing they’ll get little use out of; rather, they’re putting their money towards the experience in which they need the item. Moreover, they’re saving their money by accessing things when they need them, and splurging on what they really want or need to own.
In today’s culture, it’s not considered cheap to rent a dress; it’s viewed as resourceful and a way to have more for less. The same applies for renting a car. For many Millennials, this is an expense they can’t afford and perhaps don’t need, but in re-working the concept of want vs. need, they’re making it work to get what they desire when it’s essential. The culture of renting also taps into a core Millennial trait — they seek to share. They embrace collaborative consumption and don’t mind not having tons of material possessions, as long as these items are just a click or tap away.