ACTIONABLE RESEARCH ON GEN Z AND MILLENNIALS
4 Big Brands Joining the Rental Economy

4 Big Brands Joining the Rental Economy

As Millennials and Gen Z shoppers lean away from over-consumption, these brands are dipping their toes into the rental economy to stay in their closets…

Young consumers are “killing the shopping spree,” according to Vice. Whether they’re shopping second-hand, or just culling their closets—young shoppers are quitting fast fashion in droves. We’ve been tracking this shift for some time. Our trend Less Is More explored the rising minimalism trend, which has continued to grow: 60% of 13-36-year-olds agree with the statement, “I have been buying less clothing/accessories than I used to.” And our last fashion and shopping survey found that 57% of 13-36-year-olds tell us they would prefer to buy fewer more expensive, quality clothes, than a lot of less expensive low quality clothes. Some are inspired by Marie Kondo’s joy-sparking brand of decluttering, others are watching their budgets, while others want to help the environment—either way, over-filling their closets (and their shopping carts) is not a priority.

And these generations have alternatives to actually buying clothes. A growing number of clothing rental services has been appealing to their desires for good looking fashion without the accumulation of stuff. Rent the Runway, Le Tote, Armoire, Gwynnie Bee and many others have created new options for young shoppers. Rent the Runway has a reported 10 million members, and has expanded from event-focused rentals to an “Unlimited” subscription, opening up brick-and-mortar locations for their members to check out new items, and even a kids’ clothing rental branch. In our 2018 shopping and fashion survey, we found that 8% of 18-36-year-olds and 10% of 30-36-year-olds have rented clothing—not a huge number, at first glance, but enough that brands are taking note. If young consumers continue to eschew shopping and accumulating clothes, brands will need to find other ways to get into their closets. This year, we’ve seen an increasing number of big brands follow in the disruptive rental startups’ footsteps and try their own hand at a non-ownership based retail model for young consumers. Here are four major names who are getting into the rental economy:

American Eagle

American Eagle is jumping on the clothing rental subscription service bandwagon. American Eagle Style Drop will let shoppers swap out three items of apparel as often as they want throughout the month for $49.95, which includes shipping and dry cleaning costs. Members can pick their favorite styles, then ship them back when they’re ready for something new. Exchanges are unlimited, and free. The move could appeal to environmentally-minded young shoppers looking for more ways to go zero-waste.

 

 

West Elm

West Elm wants young shoppers to rent pillows and blankets. The brand has paired up with rental economy pioneer Rent the Runway to add select West Elm items to the offerings for Rent the Runway unlimited members will be able to rent them along with their usual clothing choices so that they can “update their home as they do with their wardrobe.” According to Business Insider, those items will be available in “bundles” of pillows, throws, quilts, and other decorative items for the bedroom and living room. The partnership debuted at a SXSW pop-up that served as a hang-out space for attendees to refresh their look and relax. The exclusive partnership, which is the first time that Rent the Runway has ventured outside of clothing, is due to launch soon.

 

Urban Outfitters

Urban Outfitters’ rental subscription service Nuuly actually pulls three major brands into the space: UO, Free People, and Anthropologie. For $88 a month, Nuuly customers will be able to receive up to six items from the three retailers to wear throughout the month; then they can return the pieces to be cleaned and sent on to the next renter or purchase the pieces at a discount. The brand touts the service as having a “constantly evolving assortment featur[ing] thousands of pieces for you.” Nuuly is scheduled to launch this summer, but shoppers can reserve their spot to the “clothing rental experience” in advance.

 

 

Ikea

Ikea is testing out furniture rental for eco-conscious (or just fickle) shoppers, according to Fast Company. The program “leases” everything from chairs to entire kitchens out for a specific amount of time, after which the brand will fix up and resell the used item. The idea to rent, return, refurbish, and resell their furniture aims to make the company more environmentally friendly (an issue young consumers are passionate about) by redirecting furniture from the trash heap to another renter’s home. Currently, only business owners in Switzerland can take part in temporary ownership of Ikea pieces, but it’s been announced that a version of the rental program will roll out in 30 of Ikea’s top markets by 2020.

 

 

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