Ralph Lauren is ready to take a big bite out of the rental business with “The Lauren Look.”
The company today will introduce its first subscription apparel rental initiative with the Lauren Ralph Lauren brand. The business, operated by CaaStle, the business-to-business rental platform, will sit on ralphlauren.com and launch exclusively in North America. It can also be accessed directly through TheLaurenLook.com.
“The Lauren Look allows us to explore an entirely new model tapping into the growing focus on the sharing economy and revolutionizing how we look at fashion consumption,” said David Lauren, the company’s chief innovation and brand officer. “Launching with Lauren, our most widely distributed and accessible brand, is a testament to the growth we see in this space and will help us further anticipate the evolving needs and makeup of our consumers’ future closet.”
The Lauren Look will include all sizes the Lauren Ralph Lauren collection offers. The size-inclusive membership includes Lauren, Lauren Woman and Lauren Petite.
Starting at $125 a month, the subscription allows members to rent looks from the most recent Lauren collections. Once the curated closet is complete and favorite pieces are prioritized, the members will receive their first shipment of four pieces. When the member is done with the pieces, they have the option to return the items to be replaced with new pieces or purchase the items at a discount. The discount is determined by multiple factors, such as wear and season. While it differs for each item, it is generally around 30 percent.
The offering includes Lauren dresses, pants, tops, jackets, and other categories. At the launch, there will be over 600 styles, and in the next two months, an additional 170 styles will be added. The site will also feature advice from expert stylists on how to wear the looks.
Lauren officials have acknowledged that the Lauren Ralph Lauren business has been challenged, consistent with the broader sector, and this move is seen as a way to reignite the category.
Lauren joins such brands as Vince, Rebecca Taylor, Nicole Miller, Gwynnie Bee, Bloomingdale’s, and Ann Taylor that participate in the sharing economy. Overall, the global online clothing rental market reached a value of $1.26 billion in 2019, with the expectation of reaching $2.08 billion by 2025, according to ResearchandMarkets.com. Market growth is attributable to Millennials, who prefer to wear well-known labels without owning them in order to stay abreast of fashion trends, along with the growing awareness of sustainability and positive environmental benefits.
Renting a garment allows a recurring revenue stream with high average revenue per user. Instead of purchasing garments infrequently, customers are spending money with the brand every month.
“Consumers today are taking a different approach to experiencing brands and building their wardrobes. The closet of the future will include a mix of new seasonal fashion, unique customized pieces and wardrobe staples, alongside pre-owned and rented clothing. With our timeless aesthetic, we are incredibly well positioned to play across each of these categories,” said Patrice Louvet, president and chief executive officer of Ralph Lauren.
In addition to supporting the reduction of clothing waste by expanding the lifespan of garments that might otherwise be purchased and worn only a few times, the collections will be part of a special after-use program. Once the clothes have reached the rental cap, they will be donated to Delivering Good, the nonprofit company that provides people who are impacted by poverty and tragedy with new and gently used merchandise.
David Lauren said the company has been working on this initiative for the past three years.
“The closet of the future is totally going to change, and the way people shop and the way people think about the environment is changing,” he said in an interview. Based on some of the testing the company has done, it realized there’s a lot of opportunity with these new business models such as resale, recycling and rental.
Lauren plans a significant marketing campaign behind the rental business. He believes the rental business will introduce new customers to the product and ultimately be better for the environment. The company is working closely with CaaStle, which handles all proprietary technology and logistics, to ensure the fulfillment process and the front-end consumer experience is seamless. While Lauren provides the inventory, CaaStle manages the cleaning and shipping and receiving from Lauren’s customers.
For $125, the customer rents four items, which can be swapped out an unlimited number of times a month. The customer can keep the item for as long as she wants.
Lauren firmly believes renting gives the company a closer relationship with the customer.
“Most customers come to us once, twice, three times a year. If they rent three months in a year, just think of how much more intimate the relationship is. How consistently they’re connecting with us,” he said.
Discussing why they decided to launch with Lauren Ralph Lauren, rather than the Ralph Lauren Collection, he said, “We’re looking at all of our brands. We really thought that Lauren was an interesting place to start. It was a brand that had lost some traction. We thought this was a way to re-spark interest and curiosity around it. It’s a brand that’s very democratic, it’s a brand that’s really an entry point into Ralph Lauren, so what a great way to build the value of the entry point into the Ralph Lauren brand.
“We also wanted to make Lauren exciting. Sometimes there’s a feeling that it’s a department store brand, or that’s a less expensive brand. My feeling is we have to bring excitement to every part of our company,” added Lauren. He also believes it’s a great way to reach a much younger customer. “The rental customer skews much younger, which is very valuable for us to bring in. They may not be able to afford Collection yet,” he said. “But this does not preclude us from bringing our rental business to our other brands,” said Lauren.
The hardest thing is getting a customer who is new and young into Lauren, he said, or to to get them back into Lauren. He feels this is an opportunity to get people to try it on again in a new way. It also builds loyalty and a way to stay with Ralph Lauren. If they like the rental experience, Lauren can begin to share it with their wholesale partners. “That could be the next model,” he said.
Asked whether he feels men are just as eager to rent as women, Lauren said, “I think everybody is going to be interested in rental. It used to be I’d have a stack of CDs on my desk, or movies. Or you go and you buy a car. Today, this sort of on-demand and rental world has changed our culture. It’s affecting so many businesses. The question is, in a world where younger people are rethinking who they are, what they need to define themselves, how often they want to evolve and change their identity and explore who they are, rental gives them the freedom to do that,” said Lauren. “It’s noncommittal, and young people are less committal. It’s a way to engage and feel comfortable when you’re slightly less materialistic. Or you’re not sure what you want your carbon footprint to be,” he said.
Lauren is seeing a real change in consumer behavior. “They’re not just buzzwords anymore. When Ralph Lauren does it, people say, ‘OK, it’s not just loaning some clothes to Rent the Runway and see how they do with it.’ Ralph Lauren is making a business model out of it. We’re doing a lot more than just partnering with a company. We’ve built a whole style guide around it, we’ve done special marketing programs around it. We’re really going to push the boundaries and understand what the future could look like,” he said.
Lauren recalled when the company launched polo.com, a lot of people wondered whether it would compete against their retail stores and wholesale shops. “I explained that the customer is changing, and there’s a new younger customer who wants to shop this way. It’s not going to take away from our retail experiences, and it’s going to enhance the opportunity. But a lot of our retail stores and salespeople were threatened about the concept of a digital experience — what about their commissions, what about the traffic in the store? Rental is going to pose a lot of the same disruptive questions. In many ways a lot of people will say, ‘nah,’ and then ‘maybe,’ and then will say, ‘Ralph Lauren is right again.’
“The multitude of touchpoints is not disruptive in a negative way. It’s disruptive in a positive way,” he added.
The service includes free shipping and dry cleaning for the customer.
While they found a large interest around loungewear and signature Lauren basics during the test period, the season’s fashion pieces were rented the most.
Asked how he thinks stores like Macy’s and Bloomingdale’s might react to this new initiative, Lauren said, “They’re going to say they’re bringing new customers to the brand, the way ralphlauren.com did, which ultimately lifted all of our boats. What they need right now is brands to step up and bring energy and newness to the consumers. If we can get customers talking about Lauren, trying Lauren, then they should buy it wherever they want.”
Another important benefit is expanding the parameters of Ralph Lauren. A lot of people look at Ralph Lauren as casual weekend wear, said Lauren. “Rental could help really put gas into our efforts to build our wear to work strategy,” he said.
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