Volition Capital Venture Partner, Rent the Runway Co-Founder on Consumer Confidence Spike
Volition Capital's Jenny Fleiss, co-founder of Rent the Runway, joins Yahoo Finance’s Sibile Marcellus and Alexis Christoforous to discuss the latest on consumer confidence and changes in the fashion industry amid the pandemic.
SIBILE MARCELLUS: Consumer confidence rose in April as the country gets a handle on the pandemic. We're seeing light at the end of the tunnel. And with that, we're starting to see the fashion industry show signs of life. I want to bring in Rent the Runway co-founder Jenny Fleiss. Jenny, how is the fashion industry getting people to buy clothes again?
JENNY FLEISS: Hi, it's great to be here. And we are definitely seeing that consumers are ready to be out and about, buying clothing, renting clothing. Rent the Runway has really been this bellwether for women's psychology around the pandemic. How are they feeling? And right now, you know, everything is coming-- everything is really coming back very strongly.
ALEXIS CHRISTOFOROUS: I know, of course, you're the co-founder of Rent the Runway, but you do sit on the company's board. Talk to us a little bit about demand today versus a year ago and some of the challenges that the fashion industry has had to deal with throughout the pandemic. I'm talking like raw materials and supply chain type issues. Has Rent the Runway experienced any of that?
JENNY FLEISS: Yeah, listen, it's definitely been a shock to the whole ecosystem for a business like Rent the Runway that is really relying on consumers getting out there, seeing other people, going to events. This has been a dramatic shift. And I think from a supply chain perspective, we saw it impact some of our designers as well, where we were looking for inventory. And they had to really adjust.
For us, we were really conscious about making sure that our whole ecosystem was set up to take advantage of the growth that we knew would come back post-pandemic. And we're seeing it even stronger than we expected. People are wanting to rent fun styles. They want to-- like, they want to explore, have fun. They've been kind of pent-up inside. And it's this renewed energy of testing out new styles and having fun with fashion again.
SIBILE MARCELLUS: Would you say that Rent the Runway at this point, you're trying to get back to pre-pandemic levels, or you're moving straight into the future, and you've got some new offerings for consumers?
JENNY FLEISS: You know, we-- I'd say, we are back to pre-pandemic and on the right track there. And I think we have a lot in store and opportunities for the future. I mean, the pandemic has made everyone more of a digital consumer more comfortable with shopping digitally. I think it has also created this pent-up demand for more social engagement. We see it in the travel industry. We see it in hotel bookings. We see it-- you know, movie theaters are opening, restaurant reservations, weddings that are being rebooked.
So all these indicators and signs, including the rental of dresses, I think is going to put us on a great trajectory to be even bigger than we were before. We've also really indexed in our sales channel, where we're selling preowned items as well through the Rent the Runway platform. And that has actually grown during the pandemic. And we see it continuing to expand and grow. So, lots of opportunities there.
ALEXIS CHRISTOFOROUS: What about within that segment, you know, like the higher end, sort of couture clothing? I mean, the galas, the black ties, they're not happening right now. So have you seen a big drop-off in demand for those kinds of clothes?
JENNY FLEISS: You know, it's interesting. The black tie dresses, people are still starting to book them for weddings. But whereas you saw a huge increase in some of the more casual loungewear, which was about 26% of our inventory, we had jumped to 44% of our inventory during the pandemic. Now we're seeing short dresses in particular and really interesting cutouts and silhouettes that are coming back incredibly strong.
So I think people are actually, like, dressing up more and inclined to be even a little more risque to some extent, even if it's not a big gala or event. They're going to bring their all to that dinner with six other friends or the music concert that is going to come back or that movie night. There's just this pent-up desire to dress up and get out there.
SIBILE MARCELLUS: Jenny Fleiss talking about risque clothing. A lot of people have been just wearing pajama pants doing their Zoom calls at the office. We're getting back, people. We're coming back from this pandemic. Jenny Fleiss, thanks so much.