Retail

How The ‘Airbnb’ Of Fashion Monetizes Wardrobes

HURR Collective

Online marketplaces are taking a page out of the sharing economy playbook for clothing rentals: HURR Collective Co-Founder and CEO Victoria Prew watched the massive rise of the model from car sharing to house sharing and believed fashion needed to be disrupted. The company is “essentially Airbnb for fashion,” Prew told PYMNTS in an interview. “We want to be a peer-to-peer marketplace,” adding that she wants to make it easy and secure to share clothes.

From a renter’s perspective, the platform has a geotagging functionality. “They can actually see on a map where the item is roughly located,” Prew said. The site also has a secure messaging platform that allows users to communicate and book an item. When it comes to the length of time for which users can rent an article of clothing, Prew said the company has rental periods from seven days up to a month in seven-day increments. The longer users rent, however, the more substantial the discount they can have.

Users also have a few options in terms of receiving the clothing. They can meet up in person in a public place for an exchange to cater to last-minute on-demand requests, or they can send items by mail. The company has also partnered with Pedals, which is said to be similar to Postmates, for bicycle deliveries that allow users to get deliveries in 90 minutes, “which makes us quite on-demand in that sense as well,” Prew said. It also aligns with the sustainable aspect of not having cars carrying parcels around central London, and Prew noted that “it’s quicker for a bike to cycle something than it is for a car to drive it from A to B.”

The Fashion Lending Platform

The site operates similarly to eBay from a lender’s perspective. Users can upload an item and send it to the company for review. The aim, Prew noted, is to build something curated for the mid- to high-end of the market. To further that goal, the company takes the time to photoshop the background of an image to make it as professional as it can look in a P2P marketplace. A user who wants to rent an item can submit a request to book the item, and the owner has 48 hours to accept or decline. For payments, the company uses Stripe and accepts credit as well as debit cards.

Lenders set pricing, although the company’s algorithms give a rough idea for the rental price of the item. However, the pricing can be overridden by the lender, who has “complete control” over an item’s price. For the target market, Prew is focusing on millennial females in central London between the ages of 25 and 35. The company operates on a model that doesn’t have a listing fee or a membership fee with only members making money. Instead, the site it free to join. And, with each transaction, the cost is split over both parties: The company takes 15 percent from the lender and the borrower.

While other market entrants are buying stock and renting it to the customer, Prew’s company allows users who own items to “monetize their wardrobe” and “make money from the things they already own.” HURR Collective, however, does not own any stock, which Prew believes will (hopefully) be a scalable model. Overall, the company is focused on attaining a balance of vintage products, one-off items as well as mid- and high-end brands.

Beyond HURR Collective, Rent the Runway rolled out a set of exclusive new clothing lines created by designers Prabal Gurung, Derek Lam and Jason Wu per news in January. The company’s new “Designer Collective” lines are said to use data gathered from the site’s shoppers to allow the items available for rent to be continuously adjusted. Each line will encompass 10 to 15 items, and designers will use feedback data from shoppers to decide how to develop each article of clothing.

Moreover, in March, Rent the Runway branched out to help shoppers rent home goods such as throw pillows, linens, and blankets by teaming up with West Elm. Some traditional clothing retailers are also getting into the sharing economy space: American Eagle Outfitters is testing an American Eagle Style Drop subscription offering to let shoppers access clothing for a fixed fee on a monthly basis. Shoppers can look through selections that get refreshed on a weekly basis, which are mailed to them at no cost.

From American Eagle to Rent the Runway, retailers are tapping into fashion rentals. But companies such as the HURR Collective are tapping into a sharing economy business model to let users borrow from wardrobes that are brought into the digital world with the help of P2P platforms.

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