Rent the Runway seeks to broaden appeal with new monthly service
Fast-growing online apparel and accessories rental company Rent the Runway wants a bigger share of the market — one that appeals to fast-fashion shoppers.
The New York-based company on Monday announced a less costly membership option that allows women to rent four items from its website, choosing from a curated selection of everyday styles from more than 200 brands. At the end of each month, members can either send the goods back or buy them at the company’s members-only discount.
The new service, called RTR Update, costs $89 a month. The company’s other membership service for everyday wear, which launched in 2016 and is called RTR Unlimited, is going up from $139 per month to $159 per month. It allows for unlimited monthly rentals, four at a time. Both membership models feature free shipping and dry-cleaning, 25% off “RTR Reserve” rentals and the ability to pause or cancel anytime.
“Since its launch, ‘RTR Unlimited’ has created an entirely new consumer behavior and has disrupted the way women are getting dressed every day,” said Jennifer Hyman, CEO and co-founder, Rent the Runway. “Our subscription business is up 125% year-over-year and is projected to triple in 2018. We’ve made clothing rental a utility in women’s lives, and I’m thrilled to be bringing the closet in the cloud to millions more women with ‘RTR Update.’”
In addition to its online presence, Rent the Runway operates five physical locations (New York City, Chicago, San Francisco, Washington, D.C., and Woodland Hills, California). It is looking to grow its brick-and-mortar footprint.
As it looks to extend its appeal to a wider audience, Rent the Runway is also rolling out its first national brand advertising campaign. The campaign will launch on Monday with 15- and 30-second TV spots.
To date, Rent the Runway has raised $190 million in venture capital funding. Its $60 million Series E in 2016 was one of the largest ever for a women-run company, according to Forbes. The company was founded in 2009 by Hyman and Jennifer Fleiss, who left in March, as a site where women could rent dresses for special occasions.
Facebook expands food ordering service
Facebook is putting electronic takeout menus into the hands of all of its members.
The social media giant officially launched its food ordering service to all Facebook members in the United States. Eliminating the need to search through multiple sites to place an order, Facebook’s service combines options from a number of food ordering services, including EatStreet, Delivery.com, DoorDash, ChowNow, Zuppler, EatStreet, Slice and Olo.
The service also features an extensive list of restaurant options, such as Jack in the Box, Five Guys, Papa John’s, Wingstop, TGIFriday’s, Denny’s El Pollo Loco, Chipotle, Jimmy John’s and Panera. The app also aggregates reviews from Facebook friends to help users make more educated decisions, according to Facebook’s newsroom page.
Here’s how it works: Customers use their iOS or Android device or desktop to access the “Order Food” section in Facebook’s Explore menu. Users can enter their preferred restaurant into the search bar or scroll through a list of local restaurants. Eateries are also broken up by cuisine categories. All entries include a featured photo, price range (indicated by dollar signs), star ratings, and type of cuisine. Listings also display whether delivery, pickup or both are available.
After selecting their preferred restaurant, customers hit Start Order, and choose which delivery service will manage the order. Customers that have an account with a service partner can connect with their ex-isting login. Those without an account can sign up without leaving the Facebook app.
Customers then place their order and pay electronically on the check-out page. The customer is sent an email with their order status.
Facebook began testing the service last year. The program was expanded based on user feedback, Facebook said.
Study: Almost half of online shoppers were disappointed last holiday season
Retailers must keep up with online shoppers’ rapidly evolving expectations if they want to succeed this holiday season.
This was according to the “2017 Pitney Bowes Global E-commerce Study.” The global technology company’s study surveyed 1,200 retailers from eight countries, and 12,000 consumers from 12 global markets.
Nearly half (47%) of online shoppers globally reported frustration with everything from shipping, to returns, to lost products and miscalculated duties and taxes during the 2016 holiday shopping season. Worse, the number of unhappy online holiday shoppers rose six percentage points over the previous year, and increased year-over-year in each of the 12 major markets surveyed.
Shoppers in Asia Pacific – particularly India (73%), Hong Kong (69%) China (64%) and South Korea (58%) – reported the most challenges. In the United States, 36% of online shoppers experienced problems, up five percentage points from the previous year.
“As consumers become more experienced with online shopping, they’re shifting more of their holiday spend online, and expect better and better service from retailers,” said Lila Snyder, executive VP and president, Global Ecommerce and Presort Services, Pitney Bowes.
“Online shoppers have an entire global marketplace at their fingertips,” she added. “They expect that there is always a way to get the product they want, shipped where they want, when they want it. This creates both opportunities and challenges for retailers.”
Online shoppers are becoming more experienced, demanding, frequent and global. Online shopping is so ubiquitous in major global markets that 94% of consumers have made a domestic online purchase.
Consumers are also shopping online more frequently. More than one-third of global consumers make online purchases at least once per week (up 4 percentage points from the prior year).
Meanwhile, 70% of online shoppers have made a cross-border purchase (up 6 percentage points from the previous year). Asia Pacific saw the biggest year-over-year increases, led by India (18 percentage points), China (12 percentage points) and South Korea (8 percentage points).
Increasingly savvy online shoppers are exercising a wider range of options when it comes to shipping, collecting, or returning their items. This includes in-store pickups, shipping to locations other than the buyer’s home, returning unwanted purchases in-store, and returning unwanted purchases using pre-paid shipping labels.
“Click-and-collect” – purchasing online and picking up in store – is now common practice for 40% of global online shoppers, up from 28% the previous year. In the U.S. alone, 46% of online shoppers use the service versus 27% last year. The practice is most common in Hong Kong where 69% “click-and-collect.” Consumers also prefer free shipping with longer delivery times (75%) over paying for expedited parcel shipments (25%).
“With even more purchases expected to be online this year, retailers need to double-down on the elements of the consumer experience that matter most – delivery, returns, tracking and world-class customer care,” Snyder added.
Another growing trend is that shoppers increasingly prefer online marketplaces over retailer websites. In fact, 67% of online shoppers turn to marketplaces like Amazon, eBay, Flipkart, Rakuten, Tmall and JD.com to search for products. This compares with search engines (46%), retail websites (40%), social media (24%), and mobile apps (23%).
These marketplaces are also spurring growth in cross-border e-commerce. Currently 62% of retailers have a cross-border e-commerce business, and the vast majority of retailers who don’t offer cross-border, plan to in the next 12 months. If all of these retailers execute against their business plans, 93% will offer cross-border shopping by this time next year – that equates to a 50% increase in cross-border retailers in just one year.
When making a purchase outside of their home country, 41% of consumers chose e-wallets and 39% chose credit cards – the exact inverse of the results from the year prior. However, preferred payment options vary by market. For example, U.S. consumers prefer credit cards (40%) over e-wallets (32%), while German and Australian shoppers prefer e-wallets (Germany 61%, 26%; Australia 64%, 23%). Credit cards are most popular in Japan (74%) and South Korea (65%).