Dive Brief:
- Rent the Runway improved the onboarding experience for new customers as the retailer approaches profitability during its latest quarter, executives said during a Q3 2024 earnings call Monday.
- New subscribers can now book appointments with the styling team to help them discover and choose items for their first shipment, according to CEO and Co-founder Jennifer Hyman. Appointments are available through phone calls, text and Zoom.
- Customers can now replace any item for any reason during the first 60 days of their subscription, according to Hyman. Rent the Runway plans to scale these onboarding initiatives, which are already driving loyalty and engagement, in the coming quarters.
Dive Insight:
Rent the Runway cited an improved subscription experience as one of its key initiatives in its pursuit of profit, and CX will continue to play a significant role in its ongoing roadmap.
Revenue grew 4.7% year over year to $75.9 million in Q3 2024, according to a company earnings release. The company’s net loss was $18.9 million, an improvement from a $31.5 million loss during the same period last year.
The onboarding improvements, which launched mid-quarter, may have helped improve membership trajectory as well. Average active membership for the third quarter was down year over year, but the total number of active members up 1%.
Rent the Runway is on track to break even on cash flow by the end of the fiscal year, according to Hyman.
Inventory improvements will work alongside a better onboarding experience to help achieve this goal. Rent the Runway is tapping into its customer data like customer satisfaction rates to identify styles with the highest demand and improve product availability accordingly.
“On a rental platform, you're never going to have perfect availability at every point in time,” Hyman said. “But we certainly can improve our position and really double down into these pillar brands to ensure that for the brands that people come to Rent the Runway for, we're giving her an even better chance of being able to wear those brands when she comes.”
Chief Product Officer Bradford Shellhammer, who joined Rent the Runway in October, will also assist with improving the customer experience. He drove product personalization efforts during his time at eBay, and his role at Rent the Runway will include “innovating the subscriber experience to drive higher loyalty,” according to Hyman.
The retailer’s latest efforts build on CX improvements made throughout fiscal 2024. The company announced plans to streamline its app and site user experience in April, and as of September, web pages loaded nearly 10 times faster than they did at the start of the year.
