Rent The Runway Segues Into Resale Market

Rent The Runway (RTR) is jumping into the resale apparel market, one of the latest companies to segue into the quickly expanding secondhand clothing space, CNBC reported on Wednesday (June 2).

RTR’s Co-Founder Jennifer Hyman said that its customers can rent designer clothing in addition to purchasing the outfits — without a membership fee. The New York City startup launched a dozen years ago is looking to grow its reach and enable streamlined entry points.

The company’s move comes as it seeks new avenues to help offset the devastating effects of the COVID-19 pandemic on its business. Remote work and school, in combination with digital shopping for everything, took a toll on households’ clothing expenditures for the office, business events, vacations, weddings and more.

RTR initially cut costs by closing stores and laying off workers. It also overhauled and simplified its subscription plans. The resale market extends “another engine of growth and a fuller realization of our value proposition,” said the company per CNBC.

The U.S. resale market is projected to top $33 billion by the end of 2021 and could reach $64 billion by 2024, CNBC said, citing GlobalData.

The markets for used clothing, accessories and home goods could be poised for a secondary surge as people clean out closets to make room for the latest offerings — possibly in new sizes and styles.

“We think that we’ll be able to convert more people to shopping secondhand,” Hyman said, per CNBC. “And from there, once they have the experience of buying something from us and seeing the quality, many of those people will end up converting into a rental.”

This wasn’t the only resale news out today: Brooklyn-based Etsy announced that it is acquiring Depop, raising the stakes in the clothing resale market by adding secondhand clothing, one of retail’s hottest growth segments, to its “global marketplace for unique and creative goods.”

And the resale market for secondhand clothing was also given a boost by Poshmark and ThredUP. The two startups told investors last month that they anticipated a surge in sales as the world continues reopening.