Democratic presidential hopeful Mike Bloomberg says the rise of rental and resale services are in part to blame for the so-called retail apocalypse.
In a Fox News town hall on Monday night, the former New York City mayor said the U.S. economy is “changing dramatically,” naming clothing resale site The Real Real and fashion rental service Rent the Runway as two culprits.
“It’s The Real Real, where people resell their own clothing and it is Rent the Runway — I can just tell you, in my company, all the young women… pay 85 bucks a month, they get five outfits, they wear them all week [and] then they mail them back,” said Bloomberg. “That’s what’s hurting the retail business.”
Bloomberg said that e-tail behemoth Amazon is also a part of the evolving retail landscape, but noted that it’s “not just Amazon.”
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“We’re doing different things,” he said. “Young people don’t buy clothing with monograms on them anywhere as much as they used to. So it’s changing tastes. And it’s changing technology.”
Rental and resale services have both gained increasing traction among eco-conscious and budget-minded consumers in recent years in a trend by millennials and Gen Zers. According to a 2019 ThredUp report, the resale market is expected to rise to $51 billion in revenues by 2023, having grown 21 times faster than traditional retail in recent years. The rental market is also seeing an uptick: The sector is projected to grow from $1 billion to $1.9 billion by the end of 2023, per an Allied Market Research report.
As rental and resale expand, traditional retailers have been looking to cash in. Nordstrom has tapped into both categories, launching both a Rent the Runway partnership and a shop-in-shop of secondhand goods, called See You Tomorrow, this year. In August 2019, Macy’s and JCPenney each teamed up with digital consignment giant ThredUp. And Neiman Marcus took a minority stake in online resale market Fashionphile in April 2019.
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