Rent the Runway is coming to Neiman Marcus — bringing a lower-priced fashion option and possibly some new foot traffic to the tony retailer.
The seven-year-old luxury apparel rental service will open a shop in the fifth floor of San Francisco's downtown Neiman Marcus on Friday. That gives more than almost 3,000 square feet, which previously held home and children's items, to rentals, returns and exchanges through Rent the Runway.
Jennifer Hyman, the rental firm's cofounder and chief executive officer, said San Francisco is the center of innovation in the U.S. and is an appropriate place to bring disruptive commerce to the luxury segment. Although the city represents one of the rental company's top-five markets, this is the first time its customers there will access a physical outpost for the service, which started online but has been growing in the brick-and-mortar field and will have seven of its own locations overall by the end of the year.
The Neiman Marcus shop will host a rotating selection from what Hyman calls Rent the Runway's "dream closet," made up of dresses, jumpsuits, jewelry and more from more than 400 designers, including Diane von Furstenberg, Derek Lam, Jason Wu and Marni. To keep things fresh, the assortment will change daily and be coupled with for-purchase products from Neiman Marcus, such as shoes, handbags, undergarments and cosmetics.
Jim Gold, Neiman Marcus' president and chief merchandising officer, said even though many of the brands that Rent the Runway offers are also Neiman Marcus merchants, the partnership offers the opportunity to attract new, potentially younger, customers, who might eventually graduate to purchasing the same designer's pieces after discovering them through a rental.
"We love the idea," said Gold, who acted as an adviser when Hyman pitched the idea of the company while at Harvard Business School. "It's an opportunity to bring in new customers who don't shop with Neiman Marcus. It's mutually beneficial."
Gold emphasized the customer service benefits that will attract potential new customers. The store will be staffed by Rent the Runway employees who will work closely with Neiman Marcus employees.
Rent the Runway will update its app to coincide with the opening, and customers will be able to search and select items to pick up in specific stores. They can book a styling appointment or chat on the app with an in-store stylist to request services such as a street-level hand-delivery of an order. Customers can also exchange rentals they received in the mail that do not fit.
And, modeled off of Apple's Genius Bar, a RTR Bar will offer quick advice or services. Members of Rent the Runway's subscription service, Unlimited, can also pick up and drop off in-store.
As the sharing economy has come to closets, Hyman calls "buy-rent" the new "high-low."
"It competes with fast fashion, which is really just unlimited variety, and that is the same thing that we are offering," she said. There are plans to open a few more Neiman Marcus Rent the Runway stores in 2017, but she did not share the location or the financial details of the partnership.
Gold said with this first iteration, he would be looking at whether the store is seeing new customers and what they can learning about these clients. "Are they buying other things from us? Are they coming back when they aren't renting something?"