Before the pandemic, Rent the Runway was thriving. They had multiple subscription options that ranged in price to fit customers’ needs, they had an unbelievable assortment of apparel and accessories, and the clothing rental market on the whole was on the rise because of its sustainability and comparative pricing. Overall, Rent the Runway felt bulletproof, and had a 1 billion dollar valuation to prove it. However, we now live in a world where people aren’t really going to the office, social events, or weddings—so there is no reason to rent a new outfit for every weekend…you get the gist.
The Rent the Runway brand laid off the majority of their retail staff and closed all five of their brick-and-mortar locations, indicating the switch from in-person presentation to e-commerce has been in the works since the start of the shutdown. According to CNBC, RTR cut costs by 51%, but have not released exactly how many jobs were eliminated. Rent the Runway notes that many customers chose to freeze rather than cancel their memberships, and they’re taking this as a sign that the rental industry isn’t dead, just on pause.
The brand’s new plan is all about e-commerce and focusing on keeping their online store above water (a business plan many retailers are turning to nowadays). To facilitate easy returns, they’ll establish more drop box locations around large markets, and customers in smaller markets can still ship their items back for free, as they had previously.