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On a Sunday afternoon in Paris earlier this month, department store Galeries Lafayette hosted a fashion show with a twist. Rather than displaying one brand, models walked the catwalk in clothes from a range of designers, including Christopher Kane, Rochas and Marc Jacobs. Models carried signs with slogans such as “renting is trending”, or “rent an unlimited dressing room with a limited budget”. All of the brands on show are on offer from Panoply, the online personal styling and designer clothes rental service that had organised the event.
The rise of rental over ownership in the past decade has shaken up sectors from hotels to transport to media, as customers choose to rent villas on Airbnb, take a taxi ride in an Uber and stream films on Netflix or music on Spotify. Fashion is no different.
The pioneer in this area is Rent the Runway in the US, which has grown to 9m members since it was launched in 2009. Rent the Runway has recently expanded from renting out designer dresses for special occasions to offering a clothing-rental subscription that aims to “put Zara and H&M out of business”, becoming a customer’s full-time wardrobe. Paris-based Panoply, which is the only rental service to offer current-season clothes, has set itself the goal of becoming the Rent the Runway of Europe.
Panoply was set up by two French businesswomen, Ingrid Brochard and Emmanuelle Brizay. Brochard says that the idea for Panoply came about from still having the “nothing to wear” feeling, even after 25 years of shopping and a wardrobe that was fit to burst. Why not try and offer customers an expansive and rotating wardrobe through rentals?
“Renting is a good alternative because it’s an environmentally friendly way of consuming and it saves wardrobe space,” says Brochard. “You have a different behaviour when you rent — women are more expressive and more edgy.” As a result of this dynamic, “buying and renting are complementary”, she adds. “Buy less and buy good basics and then have fun with the rental.”
Fashion is one of the world’s most environmentally unfriendly industries. This reflects how the volume of clothing bought has grown exponentially in recent years, driven by the rise of cheap and fast fashion brands and the ubiquity of social media sites such as Instagram that stimulate a constant desire for newness. According to Panoply research, almost a third of 24-to-35-year-olds say they do not want to be seen on social media wearing the same outfits twice.
Panoply was launched in 2016 and raised €1.8m in funding from investors including Frédéric Biousse and Elie Kouby, founders of investment fund Experienced Capital, which has backed other French brands such as Comptoir des Cotonniers and SMCP Group.
“Panoply’s business model is very much in line with the way that the market is changing,” said Biousse. “Luxury brands are demanding higher and higher prices. Meanwhile customers want access to them but they know that, typically, the more expensive the product, the less they will wear it.” Biousse sees a “drastic change of behaviour”, where “people want to wear designer clothes but instead of buying one or two dresses a year they would prefer to get access to 10 or 20.”
Like Rent the Runway, Panoply’s business is split between “one-off” rentals and monthly subscribers. Subscriptions cost from €69 a month to rent one outfit for a week to €319 a month to rent eight pieces. Panoply is also considering offering an unlimited subscription package. The demographic for subscribers is much narrower than that of those making one-off rentals, says Brochard: they are women with an average age of 35 who are working in jobs where they have a lot of client meetings and evening events to attend.
The challenge now for Panoply is to expand beyond its home market of France and gain critical mass across Europe to achieve profitability. Last year it bought Chic by Choice, a UK-based rival, a deal that will add 350,000 people to its database. “The challenge is to get at least 2,000 subscribers and pass 1,000 rentals per month and to take the leadership in Europe,” says Brochard. The group wants to improve its logistics and operations, add more pieces in larger sizes, and to ramp up its digital presence by launching an app that will implement personalised stylist recommendations.
Meanwhile fashion is coming under increasing pressure to improve its environmental credentials and stop the industry-wide practice of burning excess stock. UK brand Burberry was recently subject to widespread criticism after revealing that it had burnt £28.6m worth of excess stock last year. And the French government has announced plans to ensure that by 2019 the textile industry neither discards nor disposes of unsold products.
Brochard says she foresees a future where designers give their leftover stock to rental services such as Panoply, which then rent this out and offer brands a revenue share of the proceeds. She says: “Brands are increasingly having to think about every stage of the life cycle of fashion. Rental can be part of that.”
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