There are some things to be thankful for, because of the recession: Web-based purveyors of discounted fashion are thriving, and even when the economy comes back, we’ll still have them around. Recently there was Gilt Group, which has become a mandatory destination for fashionistas. And now there’s Rent the Runway, a new site where you can rent a dress by a top-tier designer, for a piddling 10% of what the dress costs. That amounts to $50-200–which implies some pretty fancy duds.
The logistics are simple: You browse their collection of dresses, pick one out, and it’s delivered to you the next day in not one, but two sizes. (New Yorkers can get a dress, same day.) Afterwards, you drop it back in the prepaid package, and mail it back.
Fractional ownership has actually been sort of the rage recently–ranging from super-high-end vacation homes to supercars to handbags. But this isn’t ownership–it’s simply rental. And while lots of these businesses exist they haven’t usually been purely online businesses. Moreover, they haven’t focused on current fashion–rather, a more dowdy collection that’s relatively timeless.
RTR will have to pull off something different: Nailing a very specific demographic who’ll all want roughly the same thing. Otherwise, there’s no way to get pay back on a dress that will remain fashionable for two years, max. So it makes sense that the membership is limited: Better to get word of something like this out virally before opening it to the masses, just like Gilt Group did. And better to define a very specific aesthetic. If your users have tastes that are too varied, you’ll be stuck with a lot of dead stock.
Lots of interesting style start-ups are trying to crack that curate problem. For instance, SVPPLY. The lesson being that mass marketing is hard, but if you seal away a very specific clientele, you might just be able to create high margins on a relatively small user base.