The fascination of Generation Z with renting everything from the inside

Like many young adults today, my fridge is plastered with wedding invitations and engagement announcements. As a result, I find myself frequently browsing the clothing rental app Nuuly, hunting for the perfect dress and adding favorites to my digital wardrobe. After enough time spent examining each outfit, I can now recognize dresses on other guests and even spot fellow Nuuly users on the dance floor.

Over the last decade, fast fashion has faced criticism for its environmental harm and poor labor practices. In response, thrifting and peer-to-peer resale became trendy, with platforms like Facebook Marketplace, Poshmark, and Curtsy making it easy to shop pre-owned clothing from anywhere. This shift paved the way for clothing rental apps such as Nuuly, BNTO, and Pickle, which offer designer and high-quality pieces at a fraction of retail prices.

Nuuly, owned by Urban Outfitters parent company Urbn, reached its first profitable year in January. Pickle, which lets users rent items directly from other closets, now hosts over 230,000 pieces. BNTO, combining clothing subscriptions with resale and new items, raised $15 million in a Series A round earlier this year. For Gen Z, fashion is about discovery, sustainability, and self-expression, not just cost, stated Notable, the VC firm behind BNTOs funding.

The clothing rental market is currently valued at $2.6 billion and is expected to surpass $6 billion within the next decade, according to Future Market Insights. Shawn Grain Carter, a fashion business professor at the Fashion Institute of Technology, notes that wearing secondhand or rented clothing has become a status symbol, reflecting taste rather than wealth. Fashion is now more about showcasing bold, new items on social media than flaunting brand names.

Rent the Runway pioneered the clothing rental model in 2009, focusing on high-end pieces for professional and formal occasions. However, the pandemic stalled their growth as demand for event wear dropped. Nuuly, targeting younger and mid-tier consumers, allows rentals from more affordable brands like Urban Outfitters, alongside pricier designer pieces. Its integration with family brands such as Anthropologie and Free People gives it an advantage in scaling its offerings efficiently.

Isabella De Murguia, 27, earned over $25,000 last year renting out her closet on Pickle. She considers the income fun money, funding luxury trips to destinations like Mykonos. The rise of rental apps reflects a broader acceptance of sharing economy practices, from Airbnb to ridesharing, making borrowing a dress less unusual. Brian McMahon, Pickles CEO, points out that renting clothing is even more personal than other shared services.

Pickles users are mostly Gen Z (60%), with the remaining 40% being millennials. The sharing trend extends beyond apparel, with services like BabyQuip for strollers and Tblscape for tableware. According to GWI, 20% of Americans preferred renting outfits for single events in 2022, while 5% currently subscribe to rental services for clothing, accessories, or cosmetics, and 12% had previously subscribed.

On TikTok, rental hauls combine the thrill of shopping with the sustainability-conscious de-influencing trend, giving users the satisfaction of a spree without the guilt. Nuuly now reports 400,000 active monthly subscribers. Pickle has expanded beyond New York, seeing rental growth of 195% in Los Angeles and nearly 500% in Miami this year. Rent the Runway also plans to double inventory, covering workwear, dresses, vacation wear, and casual clothing, reporting a 13% subscriber increase and over $80 million in quarterly revenue.

Many renters, like De Murguia, turn their closets into a source of income while still enjoying personal style. She spends just a few hours weekly managing her listings, washing clothes, and occasionally repairing items after multiple rentals. She focuses on pieces she genuinely likes, which tend to be popular among renters.

The rental community often converges on similar styles. Even with thousands of items available on Nuuly, users with distinct tastes often pick overlapping pieces. Reviews can help avoid mistakes, like a friends warning about an uncomfortable dress. With rental subscriptions, consumers can enjoy variety without commitment and return items at the end of the month.

Amanda Hoover is a senior correspondent at Business Insider covering the tech sector.

Author: Sophia Brooks