Future Market Insights (FMI) in a new report has projected the online clothing rental market to exhibit solid growth between 2021 and 2031. The market is projected to reach US$ 1.8 Bn by 2021. The subscription model is becoming a new trend in the clothing rental business. It appeals to retailers who are under pressure to cater to shifting consumer inclinations before certain designs lose favor.
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Even with declining garment sales, the clothing rental industry is strolling assortments down the subscription model plans with an end goal to reach its customers. The subscription model does not just give clothing rental organizations experience to potential customers, it creates recurring revenues. However, it can save retailers the expenses associated with traditional brick-and-mortar stores. The clothing rental subscription and rental market also provide designers with fast insights into shoppers’ inclinations.
Moreover, the online clothing rental subscription market is extending its customer’s reach by obliging specialty/niche markets. Some of them are adopting innovative strategies to gain traction. For instance, Gwynnie Bee offers rental clothes for plus-sized shoppers – something that has been disregarded by other online clothing rental retailers.
Meanwhile, Union Station intends to remove the nuisance from buying bridesmaid dresses, which are regularly costly and purchased by the taste and style of the lady, not the wearer. The firm empowers ladies to choose their bridesmaids’ dresses, which would then be able to be returned after they have been dry-cleaned.
Thus, online clothing rental is intended to help the customers curb expenditure on buying new clothes for any special occasion/purpose.
Key Takeaways from the Online Clothing Rental Market Study
- FMI in its latest study has forecast the market to rise at a CAGR of ~11.0% between 2021 and 2031
- The U.S. has emerged as a highly lucrative market, accounting for nearly 95% of the North American market
- The U.K. is projected to register 11.8% Y-o-Y growth in 2021, performing exceedingly well within the European market
- Germany and France will continue exhibiting high demand for an online clothing rental
- Within East Asia, the demand for China and South Korea is expected to be higher than in Japan
“In the online clothing rental business, the subscriptions and rentals are the most effective methods to keep customers engaged consistently. Some of the leading names in the market are introducing attractive offers such as discounts and gift card options to gain a competitive edge,” says FMI analyst.
COVID-19 Causing Disruptions in Online Clothing Rental
Prior to the COVID-19, online clothing rental was set to achieve sustainability, but the pandemic has caused significant disruptions as events such as weddings, social gatherings, and other occasions were canceled due to the imposition of lockdown in various nations across the world.
Companies such as Rotary, Rent the Runway, and others saw a decline in the number of rental requests. As the online clothing rental companies are primarily event-based, so when there have been no events and people are not going out in the pandemic period which in turn had a profound effect on the clothing rental business.
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Who is winning?
Some of the key players operating in the online clothing rental market are Rent the Runway, Rotaro, GlamCorner Pty Ltd., Gwynnie Bee Company, Mine for Nine LLC, Dress Hire AU, ThreadTread, Nuuly, Rent The Front Row LLC, Dress & Go Company, Chic by Choice Company, Style Lend Company, Rent It Bae Company, Mr. & Ms. Collection, The Secret Wardrope, Banana Republic LLC, Le Tote Company, and Lending Luxury, among others.
- In September 2020, to meet the changing preference/needs of today’s shoppers Rent the Runway implements new clothing subscription model planswhich include dry cleaning and rental coverage, free shipping and returns, and members-only discounts. Further, the company is also using sustainable strategies to improve the environment by using recyclable garment bags.
- In 2019, the Gap Inc. owned company Banana Republic LLC had partnered with CaaStle and launched ‘style passport’an online rental subscription for women. This would help the company to connect with millennials and Gen Zs who would to experience fashion in a sustainable manner.