Rent the Runway is ditching its unlimited membership
Unlimited clothing rentals will soon be a thing of the past for Rent the Runway.
The fashion company, known for its clothing rental business model, informed its customers Thursday that it is no longer accepting new unlimited swap members, and will discontinue its unlimited membership early next year. For $159 per month, the unlimited membership allowed members to rent any four pieces at a time — accessories or clothing — and swap them out as often as they desired.
Rent the Runway was created with the intent of allowing consumers — specifically women — to rent expensive high-fashion clothes and accessories instead of buying them.
Current membership options include the four-item plan, which costs $89 per month and allows members to swap once a month, and the $135 per month eight-item plan, where members can swap items twice a month.
The four-item plan gives members access to mostly casual, weekend and workwear styles. For the eight-item plan, members can access a wider selection that includes eventwear.
In lieu of unlimited swaps, the company is introducing a 16-item plan for $199 per month that gives members access to the entire Rent the Runway selection, allowing them four shipments a month.
Moving forward, the membership plans will let members initiate a new shipment before their returns are scanned and entered back into the Rent the Runway system, according to the company. Previously, members had to wait until their current items were scanned in, which meant they’d have a period of time without rented clothing. This change eliminates that gap.
“Our new membership structure brings our community’s most requested features to life — including customization, flexibility and increased focus on sustainability,” Rent the Runway co-founder and CEO Jennifer Hyman said in a statement. She added that most of the members will be “paying less for their memberships while receiving the same or more items per month.”
The twice-monthly swap plan, which includes eight items, is the most popular plan at the moment. About 70% of Rent the Runway current members rent fewer than 8 pieces per month, the company said. The plans that allow one swap per month and two swaps per month make up 75% of the new membership sign-ups, a company spokesperson told CNN Business.
This move comes at a time when more consumers are working from home, which means there’s less need for workwear and more of an interest in athleisure clothing.
While Rent the Runway does have a selection of athleisure clothing, it’s mostly known for its selection of workwear and formal dresses.
Rent the Runway temporarily shut down its retail locations and furloughed all of its retail employees in March, shortly after the pandemic forced states to shut down. In August, the company announced that it was permanently closing down its retail locations and the furloughed employees would not be coming back.
Rent the Runway has slashed company costs by 51% and furloughed or laid off half of its workforce, the company confirmed.
In March 2019, Rent the Runway reached “unicorn” status, raising $125 million at a $1 billion valuation.