Here’s why Macy’s, Banana Republic, and Bloomingdale’s have unveiled clothing rentals this month


August 16, 2019 – CNBC – When Lisa Batitto needed an outfit for a themed work event, she turned to Rent the Runway instead of Stitch Fix or her local department store.

Through the apparel rental company, she knew she could find the perfect dress for the animal-print themed event. She wouldn’t need to wear the dress again, so she was glad she had the option to rent instead of buy.

“It gives me the ability to always have something new, without having clothes sitting in my closet and not being used,” said Batitto, a publicist from Montclair, New Jersey.

She pays $159 a month for Rent the Runway’s unlimited service, which gives her access to the company’s selection of high-end designer apparel. She can wear the items for as long as she wants, and can return them for a fresh batch when she’s done. Battito has also used a number of other rental services, including Le Tote and New York and Company Closet.

This trend isn’t lost on traditional retailers. Gap-owned Banana Republic announced Thursday plans to launch an apparel rental service to try to capture customers like Battito. Macy’s said this week it is considering starting a rental service, while its subsidiary Bloomingdale’s will launch one in mid-September. Urban Outfitters also rolled out a rental subscription box earlier this month.

The proliferation is in part fueled by the desire of brick-and-mortar retailers to adapt to changing consumer habits and find new revenue streams. According to a report from data analytics firm GlobalData, the rental subscription market was valued at around $1 billion in 2018 and is expected to grow more than 20% a year, reaching $2.5 billion by 2023.

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