When I had the idea for Rent the Runway in late 2008, the world was a very different place. My co-founder and I believed and confidently pitched investors that we were entering The Experience Economy — a world where rental and access would dwarf ownership. But beyond the existence of Netflix, there was little evidence to prove that was true. Remember, at this time Airbnb was just getting off the ground. The first Uber ride wouldn’t happen until 2010, and Spotify wouldn’t enter the US market until 2011.
Leading up to the launch of Rent the Runway in 2009, I observed some key changes in the ways we work and live that drove my vision for the company. First, more women were working than ever before, and 70% of women were returning to the workforce after having kids, thereby putting an enormous premium on women’s free time. Second, people were trading larger living spaces for the convenience and access of large cities. The percentage of Americans living in cities is now at 63% and continues to rise particularly among millennials who are 50% more likely to live in urban neighborhoods. Finally, as social media emerged, we became our own personal brands, defined by the things we did and the places we went. Today, as a society, we take over 1 trillion photos each year and 75% of those photos are taken on mobile phones. Together, these cultural forces prompted a shift in our values where people wanted to experience things over owning them — The Experience Economy was here.
And while The Experience Economy emerged, the retail landscape was undergoing a radical transformation of its own. The market didn’t anticipate the decline of physical retail and how quickly this would occur, especially American department stores and malls. Today the data is irrefutable — U.S. store traffic is down 8% YOY and retailers are shuttering their doors. In 2017 alone, retailers including Macy’s, J.C. Penney, American Apparel, Ann Taylor, The Limited, and Abercrombie and Fitch have announced 6,375 store closings. Meanwhile, Amazon is projected to surpass Macy’s as the number-one apparel retailer in the United States this year. With 64% of all American households having Amazon Prime memberships, it’s needless to expound on the impact that Amazon has had across all categories of consumption, including fashion.
In the early years of Rent the Runway, our challenge was twofold: getting investors to buy into our vision for how the world was changing and getting women to understand that renting was a viable — let alone a smarter — alternative to spending hundreds of dollars on dresses they would wear just once. Now, less than a decade later, rental is no longer unusual but a norm of our society. Almost every one of us interacts with the experience or sharing economy every day, and I’m proud that Rent the Runway has helped to popularize and normalize this behavior.
It’s wild to think that just a few years ago, you might’ve walked into someone’s home to find racks of CDs, DVDs and boxes filled with family photos and videos. Today, if you saw a rack of DVDs in someone’s home, you would think they were perhaps slightly crazy. Can you imagine still having to purchase and keep physical copies of every single song that you wanted to listen to? Our lives today demand for access over ownership, as our society becomes increasingly more fast-paced, mobile, and on-demand. 52% of internet traffic is mobile, and people spend an average of 5 hours per day on their mobile phones. Today, we choose to put so many of our belongings in ‘the cloud’ — our identification, music, personal notes, family memories — so we can access them whenever and wherever we need to.
Why don’t our closets exist in the cloud, too?
Today at Rent the Runway, our team is focused on building the ‘Closetless Future’ — that dream state in which a woman can wake up, choose from unlimited options, and dress for exactly how she feels every single day. In this world, you don’t need a physical closet to house hundreds of items you don’t even use. People regularly wear only 20% of their closets, leading to an average of 81 lbs of clothing waste per person every year (this is insane). Instead you can access the closet in the cloud to call upon the clothes you want to wear in the moment and return them when they’re no longer useful.
We’re used to a world of so many constraints when it comes to getting dressed. There’s the financial constraint of what we can afford, the physical one of what can squeeze into our packed closets, and the emotional one of feeling forever committed to the things we end up buying. In this constrained world, women have avoided taking risks on what they wear and make compromises on how they present themselves each day. If you take a look at your own closet, it is likely filled with the color black, a lot of pieces that are ‘rational,’ a lot of pieces that you no longer wear and may never wear again. When I traveled around the country visiting women in their own homes and talking to them about their closets, every woman lamented about ‘settling’ for many of the pieces in her closet. She had wanted the bright red printed top but settled for the navy one. She had dreamed of the feathered miniskirt but settled for the play-it-safe black dress.
But access to an endless closet changes everything. Women who are liberated from the closets of the past can more freely express themselves through style and dress for the incredible lives they lead. As a result, they feel more confident, and confident women are changing the world.
A year and a half ago, we launched RTR Unlimited, our first product that gave women unlimited access to the closet in the cloud. We’ve heard from thousands of women about the ways that Unlimited has transformed their shopping habits. Since joining Unlimited, 70% report now spending less money on clothes and 52% report being more open to experimentation and taking wardrobe risks. Our Unlimited subscribers are wearing rented outfits between 8–15 days a month mostly for work and casual weekend activities — that’s ⅓ to ½ their time! Putting their closets in the cloud has made them feel savvier, more environmentally-responsible, and happier. As one of our amazing customers, Rae from San Francisco said: It’s inspired a new level of joie de vivre in the way I see things. “Why not?” “Just once!” “Just try it!” are all great filters for life choices beyond clothes, you know.
From the beginning, we knew that the cost of an Unlimited subscription wouldn’t be a realistic expense for all women. But we did want to make Rent the Runway and the dream closet we offer accessible to women everywhere. This is why I am proud to announce RTR Update, our latest membership program that makes the Closetless Future accessible to more women than ever before. With RTR Update, women can refresh their wardrobe on a monthly basis, renting everyday clothing and accessories they can keep for the month. At $89/month, we believe that renting the latest trends is the more environmentally-sustainable alternative to the wasteful, throwaway culture created by fast fashion.
We’ve also revamped our existing RTR Unlimited membership and increased the number of items our members can have on rotation, from 3 to 4 at a time. We decided to make this change after hearing from thousands of customers that Unlimited was a true ‘game-changer,’ and they wanted a bigger share of their everyday wardrobe to be items that they rented, rather than owned. While we raised the monthly membership fee to accommodate the increase in number of items, it was important for us to do right by our current Unlimited members, so they will be “grandmothered” into the current price of $139/month for life.
I dream of a not-so-distant future in which every woman can wake up, decide what she’ll wear from the millions of styles in her digital dream closet, and have her outfit magically delivered to her before she finishes her coffee. Today, we are at just the beginning of the renting revolution. There is so much more coming, and we are so excited for you to join us as we usher in The Closetless Future.
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Gurupriyan is a Software Engineer and a technology enthusiast, he’s been working on the field for the last 6 years. Currently focusing on mobile app development and IoT.