Rent The Runway Guest Speaker Event

Rent The Runway is fashion retail rental company. It allows consumers, younger people specifically, to have access to luxury products they would not normally be able to afford on a college student budget. However, it’s not just average consumers looking to spend less on haute couture, it’s celebrities like Mindy Kaling and Nikki Reed who are using the service as well. RTR has expanded nationally and has no intention of stopping its progress. By 2025, 25% to 50% of women will be renting their clothes and the market value is expected to be worth $4 trillion. RTR has created a unique shopping experience for consumers and the Customer Experience Strategist guest speaker provided me with some very valuable knowledge about this company.

One major insight I learned from this event is millennials care more about access than ownership. The women in this market find the sharing economy to be convenient and cost worthy with more options available. This is appealing especially for millennial consumers, who are more conscious about their spending habits since they experienced the negative effects of the global recession. They would rather spend $100 to wear a dress, instead of spending $2,000 on a designer dress they will wear once to avoid being an outfit repeater (Pike, 2016). With the subscription service offered for $139 per month, users are provided with unlimited access to the company’s inventory and consumers are able to create different outfit combinations for various occasions. With access to an unlimited wardrobe, it makes sense for millennials to rent their clothes instead of purchasing because, why should they settle for less? Since fast fashion is easily accessible, consumers are willing to spend more money to buy a lot of clothing that are not made from the highest quality of fabrics (Paz, 2016). This results in only being able to wear the garment a few times before discarding it. However, RTR is less wasteful and efficient with users’ savings, providing millennials with even more of an incentive to rent their wardrobe.

Another important insight I learned from this event was how crucial an omnichannel infrastructure is to corporations like RTR. RTR currently has a large warehouse filled with all of their merchandise to send nationally. They have developed a complex technology system to effectively manage shipping products in and out of the warehouse. By investing a reasonable amount of their funds towards logistics, RTR has been able to make sure their products are returned by morning, so they can be ready to be shipped out to a new customer that evening. They also have a 160,000 square foot center that dry cleans 2,000 dresses every hour to be sent out that same day (Pike, 2016). This is imperative because RTR needs to monitor its luxury products in order to know exactly where it’s going. If they lose a garment, it will impact the bottom line of their financial statement.

Furthermore, an omnichannel infrastructure also requires RTR to operate as a cross functional company. At RTR, they need their technology and analytics department to handle logistics in addition to the functionality of their site. They need their finance team to ensure they are generating sales, few losses and that funds are being properly allocated to investments in other sectors. New products are also required for RTR and they must go through the creative styling and retail department. It also must go through the marketing department and customer experiences sectors to ensure it is reasonably priced and consumers will actually want to rent the product. RTR has the challenge of carrying one message through five different, which is unconventional in most corporations. It is important for all teams to work together to create an efficient service to enhance the customer experience.

Also, because all operations are managed within the company, RTR is able to easily extract valuable consumer data to understand consumer preferences. The guest speaker previously worked for Huffington Post, which is operated globally, but she stated RTR’s system is actually larger so they can provide consumer data that will not only benefit them, but the partnerships they have established. For example, Nike has had a difficult time relating to women and reaching out to them, however with their recent partnership with RTR, they will be able to gain valuable direct data about women's clothing preferences to focus their marketing efforts on specific products. Also, Neiman Marcus announced it will be having a RTR section in their store. This partnership will help them attract the millennial demographic they have been trying to appeal to (Lev-Ram, 2016).

The final piece of valuable insight I was able to gain from attending this guest speaker event was how important it is for RTR to create the best consumer experience possible to maintain customer loyalty and brand awareness. Three aspects RTR focuses on when working with their customers is the anticipation, interaction and afterglow. For anticipation, RTR wants consumers to be excited about getting the designer product they hope will make them feel and look good. A method they have implemented to ensure this is by sending merchandise in a convenient and stylish briefcase for users to carry anyway. For interaction, RTR wants the customer to actively engage with them to let them know if there is anything wrong with the product. If the product does not fit, the customer can reach out to customer service and a new product or different size will be sent to them immediately, usually by the next day. For afterglow, RTR gets feedback from the consumer in order to improve their service. They will listen to the customers in a panel as a team or they will actively respond to any social media posts. RTR is multi-channel company and makes an effort to ensure the shopping experience for customers is seamless across different platforms. They want to ensure the customer will receive the best shopping experience whether it is from a desktop, mobile device or in store location because as a service company, it is challenging to replicate the same customer experience.

After learning about how great RTR is and how much they care about their customers, some recommendations I have for other brands is to improve customer service. By actively engaging with the customer to make sure they are having the best possible experience with their brand, it is important to show you care about them. Immediate responses and shipments of products are good incentives and method to improve this problem. Other marketing tactics for companies could also be to create more partnerships. With RTR, consumers are not only renting their clothes, but they can book hair and make-up appointments with their rental. By featuring more amenities, companies will provide more incentives for the customer to return, to use the brand more while also recommending it to friends. RTR has done this well and already has a higher brand awareness than Nasty Gal, ASOS and Net-a-Porter. Furthermore, by using a better infrastructure, it will allow marketing departments within each sector to monitor people’s preferences to get an idea of which products are selling more. By doing this brands can devote marketing efforts to specific pieces and buy similar items customers will equally enjoy.

Lev-Ram, M. (2016). Even new retailers say brick-and-mortar isn't dead. Fortune. http://fortune.com/2016/11/30/even-new-retailers-say-brick-and-mortar-isnt-dead/

Paz, I. (2016). How technology could change the way we manage our closets. Psfk. http://www.psfk.com/2016/11/forbed-under-30-summit-technology-could-change-the-way-we-manage-our-closets.html

Pike, H. (2016). Will the ‘sharing economoy’ work for fashion? Business of Fashion.

https://www.businessoffashion.com/articles/fashion-tech/will-the-sharing-economy-work-for-fashion-rent-the-runway-rental