Wear The Walk

Business & Strategy

Buy and
Borrow:
The Next
Ownership
Mix

As the next wave of clothing rental

business models begin to emerge, we
explore what this will mean in the future
for fashion ownership.
Consumer interest
R esea r ch ca r r ied out a mong UK a nd US
shop p er s b y shop p ing centr e g r oup
Westfield found tha t a lmost of ha lf of
consumer s a g ed 2 5-34 a r e inter ested in
r enting fa shion. To fur ther test the concep t,
Westfield L ond on is hosting a r enta l p op -up
in the lea d -up to Chr istma s, w her e selected
clothing a nd a ccessor ies w ill b e a v a ila b le
for shop p er s to b or r ow a nd r etur n.
The S tyle Tr ia l p op -up a t Westfield w ill g iv e
a r a ng e of b r a nd s, fr om d esig ner s
Chr istop her K a ne, Ma r q ues Almeid a a nd
Alice Temp er ley to hig h str eet r eta iler s
Whistles a nd Miss S elfr id g e, a cha nce to tr y
out lea sing for themselv es a t a time of yea r
w hen the use ca se for p a r tyw ea r r enta l
ma kes sense.
Ther e a r e sig ns the d emog r a p hic for r enta l
is now exp a nd ing b eyond Millennia ls. Mor e
tha n ha lf (52 % ) of g lob a l consumer s a cr oss
a ll a g es sa y they w ould use a clothing r enta l
sub scr ip tion for a n occa sion, r a ther tha n
p ur cha sing it outr ig ht, a ccor d ing to
Accentur e S tr a teg y’s Glob a l Consumer
Pulse S ur v ey.
Le Tote
US -b a sed b r a nd L e Tote sta r ted off w ith
mostly p r ofessiona l w omen a s customer s,
b ut notes tha t since 2 015 its consumer b a se
ha s ev olv ed . Co-found er a nd p r esid ent
B r ett Nor tha r t sa ys: “We now ha v e w omen
fr om 2 0-6 0 in b oth ma jor ur b a n a r ea s a nd
sma ll tow ns a cr oss the US . I think w e' r e a t
the v er y b eg inning of a monumenta l shift in
consumer b eha v iour , a nd w e' r e g oing to
see sig nifica ntly mor e p eop le a ll ov er the
w or ld sha r ing clothing in the coming
yea r s. ”
While ther e a r e p r a ctica l r ea sons for
consumer s to choose r enta l, it is a lso
b ecoming a sta tus p la y. S w ed en’s Houd ini
sp or tsw ea r b r a nd r ents out p er for ma nce
w ea r ski g ea r . CEO Ev a K a r lsson sa ys:
“Thr ee yea r s a g o w e only ha d conscious
consumer s [inter ested in r enting ] b ut now
w e see ea r ly a d op ter s a nd p eop le a r e w ho
p r oud of b eing sma r t a nd op en-mind ed . It' s
a much b r oa d er a ud ience tha n it w a s. ”
Sharing, sustainability and routes into leasing
A shift in consumer a ttitud es to ow ner ship B r a nd s a nd r eta iler s a r e testing v a r ious
is one fa ctor encour a g ing b r a nd s a nd r outes into lea sing a nd a p p r oa ching it fr om
r eta iler s to exp er iment w ith r enta l mod els, d iffer ent p er sp ectiv es.
b ut it’s not the only one. Other s includ e
F or some, it’s b a sed on a v ision to d esig n
g lob a l g ov er nmenta l p olicy, susta ina b ility
v er sa tile, d ur a b le a nd hig h-q ua lity p r od uct,
a g end a s a nd a p otentia lly r ew a r d ing
a nd b y d oing so ma ximise use thr oug h its
ma r ket. Westfield ca lcula tes the fa shion
lifetime. Houd ini a nd Nether la nd s-b a sed
r eta il r enta l economy in the UK a lone could
Mud Jea ns b oth cite " sha r ing " a s a g r ow ing
b e w or th £9 2 3m in the futur e.
p a r t of the b usiness.
A r ep or t fr om the UK ’s Wa ste R esour ces a nd
Other s a r e looking to b uild a b r a nd a r ound
Action Pr og r a mme (WR AP) found tha t UK
Kleiderei the concep t of lea sing , w ith messa g ing
consumer s b oug ht 2 00, 000 mor e tonnes of
focused on the exp er ience of sha r ed
clothing in 2 016 tha n they d id in 2 012 , w ith
ow ner ship a nd its conv enience, such a s L e
the r esulting hike in env ir onmenta l imp a ct.
Tote.
Extend ing a ctiv e use of g a r ments w ould g o
some w a y into r ed ucing their ca r b on, w a ter A w hole r a ft of sma ll, loca lly-b a sed
a nd w a ste imp a cts. b usinesses a r e a lso exp lor ing w a ys to
r ed uce consump tion w hile p r ov id ing
“B usinesses a r e sta r ting to a d d r ess the r ise
consumer s w ith a ccess to hig her -q ua lity
in the footp r int of clothing in the use sp a ce
p r od uct a nd /or emer g ing , susta ina b ility-
(w ea r ing a nd ca r ing ), ” sa ys S usa n Ha r r is,
mind ed b r a nd s a nd d esig ner s. Among them
technica l d ir ector a t consulta ncy Anthesis.
a r e the UK ’s Wea r the Wa lk, Ger ma ny’s
“It' s a n inter esting sp a ce w her e
K leid er ei, Amster d a m-b a sed L ena a nd
susta ina b ility a nd the sha r ing economy
S usta in/S ister , op er a ting out of Dub lin.
connect. With r enta l mod els ta king off it' s
mor e tha n just a susta ina b ility initia tiv e or
just a b usiness initia tiv e. ”

LENA
Trends and newness
The shor t ter m or sea sona l usa g e of p a r ty
d r esses, skiw ea r or child r en’s footw ea r
ma ke them some of the mor e ob v ious
ca teg or ies for r enta l. In w omensw ea r ,
r enta l offer s a r e instea d focusing on the
exp er ience of new ness in ev er yd a y w or k
a nd ca sua l w ea r , a nd b uild ing a b r a nd
a r ound the conv enience of a ccess.
L e Tote w a s cr ea ted in r esp onse to the
p r essur e on w omen to a lw a ys w ea r
something new on socia l med ia , sa ys
Le Tote
Nor tha r t. Its lea sing mod el is b a sed on a
sub scr ip tion, w hich ca n b e ca ncelled a t a ny
time. Consumer s p a y fr om $ 59 a month for
a selection of " totes" includ ing clothing a nd
a ccessor ies to w ea r for a s long a s they like.
They ca n then r etur n them to L e Tote w hen
they’r e r ea d y, or b uy if they p r efer .
Le Tote
In the tr a d itiona l r eta iler sp a ce, Ann Ta ylor
ha s q uietly la unched a r enta l ser v ice ca lled
Infinite S tyle b y Ann Ta ylor . Av a ila b le v ia its
ow n micr osite r a ther tha n thr oug h the
r eta iler ’s ma in w eb site, Infinite S tyle offer s
consumer s a ccess to a n unlimited numb er
of excha ng es for a fla t monthly fee of $ 9 5.
Consumer s r eceiv e thr ee items ea ch time
a nd ca n r etur n these (or b uy a t a d iscount if
they w ish to keep them). Online consumer s
ca n a lso cr ea te their ow n " v ir tua l closet" to
ind ica te w hich items they’d like a nd to tr a ck
those a lr ea d y in their p ossession or on their
w a y.
 Target

Business & Strategy

Strategies for
Reviving
Fashion's
Middle Market

As the mid-market continues to be

squeezed by value and luxury operators,
retailers in this space are looking to other
categories to break the discounting cycle
and differentiate their offers.
Analysis
In theor y, the mid d le g r ound in r eta il is a n
a ttr a ctiv e p la ce. F r om a p r ofita b ility p oint
of v iew it offer s v olumes p r emium luxur y
ca nnot ma tch a nd a t p r ice p oints b eyond
the r ea ch of fa st fa shion.

B ut in r ea lity, it’s a p la ce w her e r eta iler s

a r e flound er ing a nd w her e it’s extr emely
cha lleng ing to op er a te. A shift to online
sa les a cr oss a ll tier s of the ma r ket, r ed uced
tr a ffic, ov er extend ed stor e p or tfolios a nd
cur r ency fluctua tions a r e p utting mid -
ma r ket ma r g ins und er enor mous p r essur e.

R eta iler s a r e op er a ting in a n er a w her e

consumer s r ea d ily mix hig h a nd low , a r e
mov ing a w a y fr om the mid d le in ma ny
ca teg or ies a nd exp ect b r a nd s, a nd
b usinesses to sta nd for something .
R esea r ch b y McK insey sug g ests the
b ifur ca tion of r eta il w ill continue w ith
g r ow th p icking up p a ce for a ffor d a b le
luxur y a nd p r emium b r a nd s. R eta iler s in the
sq ueezed mid d le w ill ha v e to find w a ys to
cr ea te new kind s of v a lue to r ema in
r elev a nt in customer s' liv es.

Drapers
Brand positioning
Defining your self b y mid -ma r ket p ositioning S op hie L ew is, hea d of p la nning a t cr ea tiv e
a lone is unhelp ful a t b est, a ccor d ing to netw or k Ir is, a r g ues for a r esur g ence in the
b r a nd str a teg ists. At w or st, it sug g ests a mid d le ma r ket. “To some extent the joy of
b r a nd id entity r ooted in ter ms of a p r ice fa st fa shion ha s b een a nd g one – tha t’s not
offer ing r ela tiv e to comp etitor s. to sa y it' s not still a n extr emely p r ofita b le
p a r t of seg menting the tota l – b ut it ha s
R uth McConnell, b r a nd str a teg ist a t the
limita tions a nd foib les, such a s
Conr a n Desig n Gr oup , w hich w or ks w ith
ma nufa ctur ing techniq ues a nd q ua lity of
John L ew is, B ur b er r y a nd Intu a mong
clothing , mea ning w omen q uestion q ua lity
other s, sa ys: “This d oesn’t r ea lly g ua r a ntee
a nd or ig in. The mid d le g r ound ha s b een
or encour a g e loya lty. The a v er a g e customer
a b le to up the a nte a nd offer fa shion w ith a
is mor e concer ned a b out the b r a nd tr uth
Zara q ua lity tha t is la sting a nd end ur ing , a t a
a nd p r omise tha n p r ice p ositioning . The
p r ice p oint millions of w omen ca n a ffor d . ”
most successful mid d le ma r ket b r a nd s a r e
those tha t ha v e something mor e to offer . ” S o is ther e still life in the mid d le? Althoug h
ther e is no sing le v iew of w her e the ma r ket
On the sp ectr um of v a lue to luxur y, w her e
b eg ins a nd end s, b r a nd s w ith p r ice p oints
the mid d le is loca ted d ep end s on how you
b etw een v a lue a nd luxur y ha v e
v iew the p ositioning of cer ta in b usinesses.
op p or tunities to r einv ig or a te the offer a nd
“I’v e a lw a ys thoug ht of Za r a a s v a lue b ut it
esta b lish w ha t they sta nd for .
could eq ua lly b e mid -ma r ket. S imila r ly
Ta r g et could b e consid er ed mid -ma r ket
d esp ite its p r ice p oints, ” sa ys Ma tthew
B r ow n, ma na g ing d ir ector of r eta il cr ea tiv e
a g ency Echocha mb er . “Ther e’s no
a uthor ita tiv e v iew . ”

Target
Fashionability
K eep ing up w ith tr end s ma y b e mor e w ea r ing b r illia nt fa shion a nd b e hig hly
closely linked to fa st fa shion b r a nd s, b ut fa shiona b le, b ut not thr oug h clothing tha t
mid -ma r ket r eta iler s ca n r eta in r elev a nce fa lls a p a r t. ”
w ith a str ong focus on tr end s. Tha t’s the
Ta r g et is a lso incr ea sing its fa shion
v iew of Da s, w ho a d d s: “Consumer s w ill b uy
cr ed entia ls thr oug h new p r iv a te la b els a nd
into a b r a nd ’s ethos b ut it still need s to
colla b or a tions w ith hig h-end d esig ner s,
keep up w ith the times. Not ev er y b r a nd
includ ing Hunter . In June 2 017, Ta r g et
need s to b e a Za r a b ut they d o need to ha v e
a nnounced p la ns to la unch 12 new p r iv a te
a nose for tr end s. ”
la b el b r a nd s.
UK d ep a r tment stor e John L ew is ha s ta ken
The US r eta iler sa id the mov es w ill b r ing
the a p p r oa ch of b uying in la b els w ith
new ness into the b usiness, help ing to
fa shion cr ed ib ility a nd ma king its ow n
cr ea te the sa me sense of d iscov er y tha t
b r a nd la b els, such a s Mod er n R a r ity a nd
consumer s find a t fa st fa shion r eta iler s.
d enim b r a nd And /Or , mor e exciting fr om a
Thr oug h the la unches, Ta r g et a ims to d r iv e
fa shion p oint of v iew . This a p p r oa ch ha s
up the numb er of imp ulse p ur cha ses ma d e
help ed it ma inta in g r ow th in w omensw ea r
b y the numb er of p eop le w ho shop the
sa les d esp ite a mid -ma r ket p osition.
r eta iler ' s other ca teg or ies ea ch w eek.
“The mid d le g r ound ha s b ecome a n exciting
p la ce for fa shion b eyond b a sic ca p sule
collections a nd is a sp a ce full of b r a nd s a nd
full of fa shion, ” sa ys Ir is’s L ew is. “It ha s
sta r ted to b uild in fa shion, r ecog nising tha t
the a g e a t w hich w omen d esir e to continue
to b e fa shiona b le g ets hig her a nd hig her .
Women w on' t settle for cla ssics a nd b a sics,
w e w a nt to continue