Objects of desire can be borrowed, not only bought
But when Lee paid for two outfits, the receipt was for one-third the original prices.
A typical luxury boutique from the outside, this Salon de Charlotte in the branch’s basement is a shop that lends clothes instead of selling them.
“I wanted to wear a dress from a particular brand called Just Philippa, but it was too expensive for a one-time event so I decided to borrow it,” said Lee. “For my daughter as well, I wanted something special for her to wear at her first birthday party but kids grow up so fast so there’s no point in purchasing an outfit.”
Opened in July, the shop offers an array of fancy women’s party gowns, men’s suits and children’s dresses from domestic and global designers. Some brands in the shop are sold in other parts of the department store.
A 1.5 million won ($1,277) dress can be borrowed for two to three days for one third its original price. A manager in the shop offers suggestions to customers according to their preferred style and the occasion being shopped for. The shop has a fancy fitting space so that customers can freely try on any outfit before making a decision.
“We are receiving about 50 visitors every day,” said a Lotte spokesman.
Although Lotte was the first to open a bricks-and-mortar borrowing shop, it is not the only retailer having a go at luxury fashion rentals, which were unknown in Korea before last year. Through such services, customers can gain access to premium or designer brand products at much lower prices. The business is very active online, with major companies and start-ups jumping into the niche.
In the past, luxury goods or designer clothes were a way to express one’s uniqueness by wearing or carrying items not easily afforded by the general public. The rarer an item was, the better.
That’s a far cry from sharing luxury items with many people. But industry analysts say perceptions have changed in the last few years, as more people got used to sharing items and to stop thinking they must own luxury goods forever.
SK Planet launched a fashion rental app called Project Anne in September. Unlike Salon de Charlotte, where customers borrow individual items, Project Anne’s system is to select a monthly payment plan that differs according to the numbers of products borrowed in one month. For example, under an 80,000-won plan, a subscriber will receive four designer outfits wearable for 15 days. If the customer decides to keep the outfits, SK Planet will send a new item of the same model at a reduced price.
The service reached its goal of 4,000 subscribers in the first three months. During the same period, the app was downloaded 30,000 times.
To celebrate its success, Project Anne opened a brick-and-mortar pop-up store in Hyundai Department Store in COEX last month for three days, during which a professional stylist gave fashion consultations to customers. “The event got positive feedback, so we plan to open this pop-up every two to three months,” said an SK Planet spokesman.
For smaller online start-ups, handbags are the focus for premium rentals. The Clozet, which launched in September, lends one bag for 15 days on a monthly membership plan of 79,000 won and allows exchanges up to three times. It has a vast inventory including Miu Miu’s clutch, Balenciaga’s Motor bag and Marc Jacobs’ backpack. The company can’t keep up with demand. Users have to wait two to four weeks in order to obtain a regular membership.
“The most popular bags are grabbed as soon as they are returned,” said Kang Young-ho, director of the company’s managing team.
This is a new part of the sharing economy, which was created by Airbnb and Uber. Now people are getting used to sharing handbags and clothes.
“The familiarity with a sharing culture and a minimal lifestyle that de-emphasizes ownership were big influences for the fashion rental business,” said Kim Victoria, senior consultant for the research company Interfashion Planning. She points out that clothes or accessories from luxury or designers brands were usually worn for particular occasions, not everyday life, which naturally makes them appropriate for short-term rentals.
“Compared to Western culture where people are familiar with fancy parties and high-end restaurants, Korean consumers did not have many occasions to wear such items in the past, whereas nowadays such culture is more widespread among younger Koreans,” she said. Kim also attributed luxury fashion rentals’ rise to a changed perception of fashion among the younger generation to prioritize efficiency.
Lee Hee-sook, a professor of consumer studies at Chungbuk National University, also said the business will appeal strongly to younger consumers. “They basically have very strong will to express themselves through consumption and fashion is one of the most sought-after ways of doing so,” she said. “At the same time, they earn much less than older generations, which makes them a consumer group with high price elasticity. Therefore it’s natural they’re more pro-active in borrowing premium clothes at a cheaper price.”
Some say that the fashion rental business is not entirely about sharing, but also the outcome of a consumer culture that prioritizes the varied experiences of shopping. Industry insiders say fashion rentals provide consumers more chance to create bonds with brands that would ultimately lead to sales. Kim Kyung-hoon of the Korea Trend Research Institute said that for today’s consumers, experience is as an important source of information in making reasoned decisions even in shopping.
This is why analysts predict that the lending business will not deal a blow to manufacturing brands. It may turn out to be an opportunity to expand potential buyers.
“Low cost or ‘fast fashion’ brands may be affected by the rental business, but for premium brands, such services have advantages because it gives a chance for potential buyers to experience their products and create a bond with the brand that they would not have had access to if not for rentals,” said The Clozet’s CEO Seong Ju-hee.
The industry is already established in many other countries. America’s Rent the Runway launched in 2009. Although it started online, it now has seven brick-and-mortar stores and was dubbed “A Netflix for Haute Couture” by The New York Times. The online designer rental Girl Meets Dress also opened in 2009. In Japan, a similar service started in 2015 for which a professional designer handpicks items for customers.
New versions are evolving. Le Tote, an online U.S. start-up that launched in 2012, sends clothes and accessories selected by the company to each customer based on wish lists they write after signing in. It has a separate line-up for pregnant women.
BY SONG KYOUNG-SON [firstname.lastname@example.org]