A Glossy Podcast interviews jewelry brand Switch on how they drew inspiration from the fashion brand Rent the Runway for their new rental model. Switch is now renting out jewelry for $29 a month. Their rental model is also subscription-based allowing them to generate a higher engagement and retention rate from their customers. While renting out jewelry for $29 might seem to negatively impact the company’s revenue, this is not the case. According to the podcast, “In two years, to have an endless rotation of jewelry instead of just purchasing one piece — that, probably, after two years you’d be sick of — is a really good value for our customers.”
The subscription and rental-based models are becoming more popular, and, thus, more competitive. A Glossy article notes the increases in the number of players in the rental fashion world and reveals that “Rent the Runway is tinkering with its available subscription plans by adding a third option in between the lavish Unlimited subscription and the more bare-bones Update or 1 Swap, subscription.”
The article further highlights that Rent the Runway launched “the new 2 Swap plan” on Tuesday. This plan “will let customers swap out their four rented items twice per month for a monthly fee of $135, instead of once as the $89 1 Swap plan allows.” The article closes with the 2 Swap plan “is one way that Rent the Runway, the largest but certainly not the only major player in the rental space, is standing out from competitors.”
While subscription and rent models may be attractive for fashion brands, they must come up with a unique strategy for the models to be lucrative.