I have never rented anything from Rent the Runway, the unicorn women’s “unlimited closet in the cloud” fashion site, your secret door to the latest in the rag trade.
You can rent clothing by the one off, on a subscription basis, and buy the clothes at a discounted post-rental price. They send you (gratis) a second size to make sure you can fit into their clothes. It is a first rate business.
Though I have never rented a dress (don’t carry the right size for Big Red Cars), I have always loved the business concept, their financial model, their innovative business development, their founder story, and their web site.
The company was founded by a couple of Harvard MBA women in 2009 — Jenny Fleiss and Jenn Hyman (bit of irony, no? couple of “Jens”). It is a profitable unicorn.
However, if today you go to their website, you will find the following message:
Currently all one-time Reserve rentals must be scheduled for delivery after 10/15.
Thanks for your patience as we upgrade our system!
Imagine the conversations within the company that resulted in that sentence appearing on the website. In addition, the company is not taking any new “members” for any of their programs.
In essence, the unlimited closet in the cloud is out of business for 2-3 weeks. Closed for tech remodeling! Never saw that happening!
How does a company weather a 2-3 week unannounced cessation of their business when they are an immediate gratification B2C, cutting edge fashion business?
This interruption cannot be good for business. A unicorn startup has had to essentially shut down their business until 15 October 2019 because they are having tech problems.
The great irony of this is that at the time of founding the company, RTR outsourced their tech development, were unhappy with the performance, and brought it back in house. They were already keenly aware of the difficulties with tech development and they fell into the same dark blue/white screen of death snake pit.
In fairness, this will probably not destroy their business, but it will dent it. If a customer had their eye on a particular dress for a specific event — ouch.
The RTR founders have been extraordinarily entrepreneurial and insightful with their original idea, with their subscription membership strategy, with their bricks and mortar sites, with their pickup and drop off locations (some in We Work offices), and their disposition strategy. It has been a brilliant march to the sea. Bravo!
This company has done a lot of things very well. They are, as I noted, a profitable unicorn. That is a very rare unicorn indeed. [Making fun of you guys at Uber, Lyft, Peloton, We Work, if the shoe fits wear it. Rent the Runway doesn’t handle shoes, yet.]
I will be rooting for RTR to get this problem behind them as soon as possible. In the meantime, the company is sending kisses and $200 gift certificates to those whose events they have crushed.
And, you think you’ve had customer services problems. Haha, you think YOU have had customer service issues? Sorry. That was very uncouth of me to say that. Won’t happen again.
Give me the skinny, Big Red Car
OK, dear reader. The scuttlebutt is that the company is profitable and has been under investing in customer service and tech to maintain profit margins.
That happens with real companies. It is legit.
But, you can’t cut things so tight that you wreck the company in the process.
This is a huge business failure. Failure to see it coming. Failure to do something to forestall it.
Bottom line it, Big Red Car
Here it is, dear reader: Stay on top of your tech at every step of the process. Never, ever, ever allow your website, your front of house, your database, your back of house, your fulfillment to be the limiting factor in your ecommerce business.
Anticipate your growth and be ready for it before it arrives. Simple wisdom.
We spoke about Rent the Runway a year ago when we dissected their pricing strategy and their fundraising. You can see it was a great business then.
Pricing Strategy — Rent The Runway
But, hey, what the Hell do I really know anyway? I’m just a Big Red Car and I look great in red. Can I get a paint job, please?
