Changing consumer habits during the pandemic forced the clothing rental service to change the terms of the subscription.
It was decided to abandon the unlimited subscription, which allowed you to change an unlimited number of things for $159 per month, provided that you use no more than 4 items at the same time. The new subscription terms include three plans - 4 items for $$89 per month, 8 items for $135, and 16 items for $199. For each additional item of clothing you will need to pay extra separately.
According to CEO Jenn Hyman, such plans appeared 18 months ago. However, the coronavirus pandemic has significantly accelerated their implementation. At the same time, in Rent the Runway well aware that the innovation will upset many users, making such a decision was not easy for the company.
Practice has shown that during the pandemic, most consumers (about 80%) rented no more than 4-8 items per month. And only 6% customers really often exchanged things, that is, they really enjoyed the benefits of an unlimited subscription. These statistics formed the basis of new subscription options.
According to the company, the introduction of new tariff plans will allow customers who rented a few things to save money. So, if a person rents no more than 4 items per month, then it simply does not make sense for him to pay the full price, he can choose the option for $89, which is almost two times cheaper. Rent the Runway itself will be able to optimize supply chains and make internal business processes more flexible.
Also, according to Jenn Hyman, the new tariffs will also be good from an environmental point of view. The fact is that reducing the total number of shipments will reduce the amount of packaging and reduce carbon emissions.
This is not the first company's business optimization actions caused by the coronavirus pandemic. So, earlier Rent the Runway announced its intention to completely abandon the stores, focusing entirely on e-commerce and expanding the network of points for issuing orders.