The retail narrative has always been about two separate businesses: the off-line world & the online world. Despite a lot of talk about Omnichannel, most off-line retailers didn’t seem to get the Online challenge!

I saw an interesting change with this move by Rent the Runway.

Rent the Runway offers designer fashion delivered at your home for a fraction of the price. With over 170 top designers, 35,000 of the season’s hottest dresses and 7,000 accessories, Rent the Runway is trying to completely change the fashion buying experience.

And now, Rent the Runway is set to open its first store-within-a-store inside Neiman Marcus’ Union Square, San Francisco location as part of a new partnership between the fashion tech startup and the luxury retailer.

I found this quote from Forbes to be interesting: The move sees Neiman Marcus allowing an ostensible competitor 3,000 square feet to rent apparel and accessories to a demographic it has struggled with: millennial women. It also allows Rent the Runway(RTR), with its median customer age of 30, to get in front of an older, wealthy clientele.

The women-led startup, which has raised $126 million in venture capital has also innovated it’s pricing with an “Unlimited plan”, which launched earlier this year. The $139/month subscription allows women to rent and wear up to three pieces at a time from sought-after contemporary design houses including Proenza Schouler, Jason Wu, and Derek Lam.

I see quite a few innovations at play here:

1. Partnering with a competitor is cool: still to early to conclude but it is an interesting approach. Maybe a Myntra & Shoppers Stop deal enhancer!
2. New pricing models: Younger consumers like the variety that subscription pricing gives them. But the jury is still out on this one. RTR has furiously innovated to try & get this right but the core subscription pricing model is something that other retailers should watch out for.
3. Thinking about customer segments differently: I loved this quote “It’s thinking about who the next-generation luxury consumer is,” said Rent the Runway CEO Jennifer Hyman of the latest additions to their service. “For her, luxury is time.” RTR’s target client would be willing to pay it, given that her comfort with the sharing economy.

4. Very intense focus on the Product proposition: Would women accept renting clothes as a concept-consumers had to be convinced about the proposition.Rent the Runway took a big step toward solving this problem by becoming amongst the largest dry cleaner in the US, with a 160,000-square-foot facility

5. Being very data focused: Over the years, data has been core to Rent the Runway’s decision-making.Data has helped drive the business strategy,though I find it hard to separate the PR elements of how they use data with the facts! But assuming that they are doing something terrific with data & actually using reams of data about product attributes that they collect, it could be a possible game changer! A few other companies also talk about this-see this video about a company called Stitch: http://for.tn/1U9LVxN

Read more about this fashion innovation here:

http://bit.ly/2fSPFT8