Rent the Runway Offers Free Items to Woo ‘Cost-Conscious’ Shoppers

Rent the Runway will begin adding a free item to shipments to attract financially strapped consumers.

“The customer is more cost-conscious than she’s ever been before,” Jennifer Hyman, CEO of the pre-owned design apparel market, told Bloomberg in an interview Monday (March 6).

It’s a move that comes at a time when half of all consumers say they are switching to brands that offer them steeper discounts.

Hyman said the company considered reducing subscription fees but opted instead to give its users more items at the same price, the idea being that it would both attract and retain customers.

“This business grows by women organically telling other women about Rent the Runway,” Hyman said, per the report. “We get a lot more bang for our buck investing into the customer experience than investing into marketing.”

According to Bloomberg, the plan will let subscribers to Rent the Runway’s most popular plan — which offers eight items per month in two shipments — receive one more item in each shipment, or two items a month.

“We can make this investment into the customer with it having minimal impact on our gross margin,” Hyman told Bloomberg. The initiative is a signal that the company is enjoying more financial flexibility following recent restructuring.

That plan, unveiled last September, involved cutting Rent the Runway’s workforce by 24%. It followed a quarter that saw its active subscriber base drop from about 135,000 to 124,000.

In December, the company reported record revenue and an increased subscriber base.

Now, Rent the Runway hopes to keep growing that base even as inflation continues to put pressure on consumer spending.

As PYMNTS research found, 44% of American adults said finding better deals has become a much more, if not the most, important factor when deciding where to buy retail or grocery items. The number of consumers who called themselves deal-chasers rose steadily over the last six months.

“For deal-chasers who want a new black dress for a night out in the town, the retailer with the cheapest black dress wins,” wrote PYMNTS’ Karen Webster. “The black shoes to go with that dress? That sale may not necessarily go to the merchant that sold a deal-chasing consumer the cheapest black dress.”

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