Rent a Trend!

Samir Alam assesses the rising graph of rentable fashion and how it is playing out for the industry today.

- Samir Alam

If 20 years ago, someone had pitched a business idea that was about shared services and goods, we would not quite have believed them. The traditional customer of the yesteryears was someone who took pride in owning a private car or vacation home. But given that the nature of the global economy has changed, so have the buying behaviours of today’s customers. The current era has given birth to the ‘sharing economy’, which is made up of multibillion-dollar players such as Uber and Airbnb, which have changed the way in which people consume goods and services. In this article, we will analyse the nature of this shifting economy, how it has given birth to the trend of renting apparel, and what it really means for the industry.

RENTING VERSUS BUYING

In the pre-2010 era, nearly every traditional business model was a viable reality. At that time, the benefits of lower competition and simpler market structures created a middle class. For most developed and developing economies, the rules of trade were straightforward. But as the internet and mobile devices proliferated, we rapidly discovered that the middle class also changed, and was no longer capable of making long-term commitments in the face of global economic disruption and instability.

In fact, it was in the wake of the Great Recession of 2007–08 that we truly started to see the rise of the sharing economy. Companies such as Uber, TaskRabbit, Lyft, and many others began offering lower-cost services to a yearning consumer base. This has proved more successful than anyone could have ever imagined. For example, Airbnb, a leading player in the hospitality industry, rivals some of the largest hotel chains in the world, what with presence in thousands of cities across more than a hundred countries. The service has attracted over millions of people as hosts, who have, in turn, served well over 400 million guests.