For Jennifer Hyman, the journey is just beginning. The CEO of Rent the Runway, the darling fashion-tech company that rents designer clothing to women at low prices, said her mission is to have every woman in the world paying for a subscription to fashion. The company, which is seven years old and has six million (self-reported) users, launched a partnership with Neiman Marcus this month, bringing its rental collection into stores. It also happens to currently operate one of the biggest data science operations in the industry—and the largest dry-cleaning facility in the country.
Hyman joined this week’s Glossy Podcast to discuss how she got people to stop thinking renting clothes was gross, the role of data in her business and why leadership needs to be about more than “sparkle.”
Edited highlights below.
Consumer behavior was hard to shape, but brands were harder to convince.
Hyman said one of the hardest things about launching and growing the company was to convince customers that renting things others had previously worn wasn’t disgusting—it was normal. To do this, Hyman pegged the brand to female self-confidence through features like customer photos prominently displayed on its website telling the story of “the night they wore Rent the Runway.” “If you compare it to transportation, it was over 80 years ago that people had the ability to lease a car. We’ve had 80 years of practice, so Uber doesn’t feel that crazy,” she said. “We need to create a behavior.”
But brands and designers were very skeptical seven years ago. “When we launched in 2009, we only had 28 brand partners. And a lot of those brands went out of business. The reason they launched with us was because they were desperate,” said Hyman. For many, it was the fear that it would cannibalize retail sales. “But my thought seven years ago, and it has proven true, was that when you give people the option to rent, they end up renting very different things from what they end up buying.”
Fast fashion helped.
Customers were being primed, Hyman said, by an unlikely group of companies: fast fashion brands. The biggest winners in the industry have been the Zara and H&Ms of the world. “Any time you go into a store and you buy a shirt for $19.95 that will disintegrate, that’s effectively a rental,” said Hyman. “They’ve primed a global population to be comfortable with this concept of disposable fashion.” So for both customers and brands, Hyman said, the pitch was this: “Rent the Runway is fast fashion with real products at fast fashion price points.”
The best thing Rent the Runway did was invest in data.
One of Hyman’s first hires—and her first C-suite hire—was Vijay Subramanian, a former Oracle executive who developed Rent the Runway’s propriety “just-in-time reverse logistics.” He basically established the big differentiator for the company, which was getting fulfillment and logistics right. Do that, and the brands will come. “We’re the only ones in the world that can rent physical goods with a zero-day turnaround time,” said Hyman. That means inventory can be anywhere at any time, and the system has to know what’s coming, what’s going, and when things need to be repaired, cleaned and re-assembled. “That’s a huge data science problem,” said Hyman. “Because if you were to put everything through machines at the exact same time, you’d need so many machines, so much capital to invest that you wouldn’t be able to afford to run your business. How do you allocate your products through your warehouse throughout the day? Thats a data problem.” Putting Subramanian and his role at the center of it has ensured Rent the Runway’s success.
Hyman wants to transform and diversify leadership.
Hyman said that her most unpopular opinion is about the election, which happened to be the day before Rent the Runway’s seventh anniversary. The election went to Donald Trump because he had, in startup terms, a higher net promoter score: His supporters ranked him a nine or 10 all the time. “I think there is something in our culture that associates leadership with sparkle and inspiration and charisma. Often, we’re looking for those surface qualities. Who can entertain me? Who makes me laugh? Who’s a ‘good guy’? Who do I wanna grab a beer with?” That often doesn’t correlate with true leadership, said Hyman. “There’s something in our culture attracted to the magnetism of the sizzle reel. We need to look deep into ourselves. We need to diversify the concept of leadership.”