There’s no question that the rental market is booming — Selfridges and Diane von Furstenberg both jumped in with new programs last week following a burst of activity across the department store sector.
But when it comes to shoes, market watchers are split — and skeptical — despite the $1 billion online rental market’s success in apparel. There are many factors to consider, notably the maintenance and hygiene of the shoes.
Farla Efros, president of HRC Retail Advisory, said she sees the appeal of renting apparel because it is easy to clean. But for her, shoes are different. “I could see a market for higher-end shoes for special occasions for one day,” she said. But longer rentals don’t make sense, Efros said. “When retailers are going down this path of renting, I think all you’re doing is you’re cannibalizing your base business,” she said.
For sneakerheads who always want the next new release or next collaboration, a rental could make sense, said Melissa Gonzalez, CEO of the Lion’esque Group, particularly given the high cost of some sought-after sneakers.
Watch on FN
But, Efros asked, “Do you really want to put your feet in someone else’s sneakers?”
Podiatrists caution that sanitary measures and regular maintenance must be undertaken to ensure good customer interactions with the rented footwear so as not to harm feet or spread bacteria and fungi. Sweat, moisture, and wear and tear are a concern as shoes move from renter to renter, particularly with sneakers.
Generally, though, wearing a higher-end shoe one time shouldn’t create a lot of issues. “If the shoes are used as intended— special occasion, so light use — and then sterilized with ultraviolet light, it would be reasonable,” said Dr. Kieran Mahan, a professor of podiatric surgery at Temple University’s School of Podiatric Medicine. “Ultraviolet light is effective at killing bacteria and is used in various industries.”
Washington, D.C.-based Eternal Styles founder Kay Garcia has an inventory of about 50 high-end shoes that are rentable for one week at a time. On the Eternal Styles website, a pair of Giuseppe Zanotti suede boots rent for $45 and a pair of Christian Louboutin sandals rent for $156, for example.
Garcia said that she and her staff of less than five, take great pains to sterilize and disinfect the footwear with ultraviolet light when it comes back. They also wipe down each shoe with disinfectant. Garcia also protects the soles of the footwear with clear thin rubber protectors and sends shoes to a cobbler when needed.
“Even the shoes that have been rented many times, they still look good,” said Garcia. “I don’t get complaints about the quality or the condition that the shoes are in.”
Already broken-in shoes, where the leather is stretching, could have mixed results for a consumer. “The fit of the shoe can also change, depending on who has worn them before. In some ways, shoes can be broken in already so they may not rub toes or bony prominences the same way, but [they] also can be broken in differently from your personal needs,” said Dr. Diane Koshimune, a foot and ankle surgeon affiliated with Kaiser Permanente in Northern California and a spokesperson for the American Podiatric Medical Association.
Mahan noted that there is likely a limit to how long a shoe can remain in the rental rotation. “The greater the wear on the shoe, the more that mechanical deformation of the shoe would affect its support of a person’s mechanics. So how often the shoe is used before it’s taken out of circulation would be a factor,” he said.
Do the Rewards Outweigh the Risks?
As Generation Z and millennial consumers embrace the sharing economy, it’s only a matter of time before shoes fit into the rental market, especially for more expensive $500-plus shoes, said David Swartz, an analyst at Morningstar. “A rental would make sense. It’s a lot of money [to spend], especially for shoes that could go out of fashion at any time,” he said.
One large player is seriously looking at rentals: Designer Brands Inc., parent company of DSW. “We are exploring shoe rental and ways to bring this service to life in a way that delivers on customers’ expectations,” Erin Kelly, the company’s VP of innovation and initiatives, wrote in an email. “Differentiated experiences are important to our growth at DSW; we’ve been testing repair services in select markets and are currently expanding our successful nail bar test.”
Footwear’s big growth is going to follow a lot of these more obscure, nontraditional ways of selling at retail, predicted Marshal Cohen, chief industry analyst at the NPD Group. He noted that men have been renting dress shoes to wear with tuxedos for decades.
In addition, shoppers don’t “consume the way the prior generations did and don’t even remotely pretend to try,” said Cohen. The millennial generation, he said, is committed to not committing. They don’t want to own more things, and they believe in sustainability. Renting, leasing or borrowing is a natural part of life.
“For people who want to rent, when they rent a shoe, they want people to know it’s a designer shoe. If it doesn’t say or if it’s not easily recognizable, people tend to not want to rent a shoe,” said Garcia, who is a former wardrobe stylist.
For Lona Alia, who founded Style Lend in 2013 and now has an inventory of about 500 shoes, as well as apparel and accessories, giving people access to other brands or styles than what is in their closets is important.
“A lot of our customers are already owners of Louboutins. They just want a variety,” Alia said. “They’re looking for a different one. They don’t want to buy it for $1,000 when they can rent it for $80. It’s not so much about people not wanting to buy them anymore. I think people will continue to own shoes regardless. This will just spice up their wardrobe on the days they want to look different.”
Under the gloom of a mediocre holiday season for department stores, the department store sector is looking to rental and subscription services as one strategy to help connect with consumers both online and in stores.
As a result, department stores are looking for “new ways to separate themselves. They know people are shopping online, and they’re trying to use stores to enhance online shopping. But then people have no reason to go to the stores. So they’re trying to put something different in the stores,” said Swartz.
In the last several months, Lord & Taylor, Nordstrom and Bloomingdale’s have either launched or re-committed to providing subscription and rental services. Le Tote-owned Lord & Taylor said in November that they are mulling how to launch a special occasion rental business, in addition to continuing to integrate and expand the namesake Le Tote subscription service in brick-and-mortar Lord & Taylor stores.
“Our goal is to allow the inventory to be in Lord & Taylor — whether in the store or on the website — and have it live its life to the fullest there. Before it has to be gotten rid of, we grab that and push it into the rental channel to give the customer a much broader assortment and breathe new life into it,” said Ruth Hartman, president of Lord & Taylor, told FN.
Bloomingdale’s announced its own $149-month price subscription service, My List, in September, while Nordstrom recently expanded the number of stores where customers can return Rent the Runway merchandise at in-store drop boxes. In a somewhat similar example, Kohl’s allows in-store returns of Amazon-purchased goods in over 1,100 of its stores, bringing in ample foot traffic, which moves the in-store sales needle, based on the sheer number of stores Kohl’s has, said Swartz.
At Nordstrom, the partnership with fashion rental service Rent the Runway will expand eventually to 29 stores, where subscribers can return Rent the Runway merchandise at branded drop boxes. Nordstrom is betting subscribers will make an impulse purchase or two while in a store, Cohen noted.
Swartz is skeptical, however. With drop boxes in less than 30 stores, the partnership won’t yet have a significant impact on sales or margins, she says. But it’s something new that Nordstrom can afford to experiment with, at a time when the entire retail market is in the midst of change.
“They have loyal customers, a big online business, and people trust the Nordstrom brand. They have a better situation than others,” said Swartz. In addition, Nordstrom plans to design exclusive product with Rent the Runway, and Nordstrom will also contribute merchandise to supplement Rent the Runway’s rental services. Rent the Runway did not return requests for comment.
“The ability to tag onto that with Nordstrom exclusive product is a huge plus for [Nordstrom] because now they’re able to create that ever-growing relationship. Loyalty and longevity is what the department stores lost when they became homogeneous,” said Cohen.
Differentiation, Nordstrom said, is top of mind. “We’re continuously working to provide our customers with a sense of discovery with products and experiences that resonate with them. We look for opportunities to launch new brands and grow existing partnerships to differentiate our offerings for customers,” a Nordstrom spokesperson wrote in an email.
But Nordstrom and other department stores as well as Rent the Runway have decided not to venture into shoe renting — at least for now. Will that change in the future? Stay tuned.