Rent the Runway Inc. will launch an online storefront with Amazon.com Inc. Doing so will expand the clothing rental company’s reach beyond the subscription business model.
The Amazon Fashion platform will feature previously worn styles from designers that Rent the Runway already works with, as well as new and unworn designs. Rent the Runway said revenue from the partnership contributed about $4.6 million to adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) in the quarter ended Oct. 31.
Amazon.com Inc. ranks No. 1 in the Top 1000, Digital Commerce 360’s database of the largest North American online retailers by web sales. Rent the Runway Inc. is No. 407 in the Top 1000. Amazon also is No. 3 in the Digital Commerce 360 Online Marketplaces database, which ranks the 100 largest global marketplaces.
Rent the Runway is not the only apparel retailer collaborating with Amazon Fashion
Rent the Runway suffered from a drop in subscribers during the pandemic. That prompted a restructuring plan in September that included dismissing about a quarter of its non-hourly employees. Since then, the clothing rental company has added new subscribers and in December boosted its annual revenue outlook, noting “considerable progress” on consumer initiatives.
“Collaborating with Amazon Fashion brings Rent the Runway incredible brand awareness,” Rent the Runway CEO Jennifer Hyman said in a statement. “We believe strategic relationships like this can ignite a new engine of growth for our business.”
A handful of other apparel retailers, including Gap Inc., have also collaborated with Amazon Fashion in recent months to access the ecommerce giant’s global customer base. Amazon is a major clothing retailer, but the company has long struggled to attract luxury brands. They are often wary of counterfeit goods and losing control of their image.
For Amazon, the partnership is a step toward growing its existing apparel and accessories resale offerings. Consumers are increasingly flocking to resale platforms like EBay Inc., Etsy Inc.’s Depop and Poshmark Inc. in search of good deals and a more environmentally friendly way of shopping.
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