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Nordstrom and Rent the Runway Are Joining Forces

Nordstrom is leveraging its store network to make pickups and drop-offs more convenient for other retailers' customers.
Rent the Runway kiosk at Nordstrom Local Melrose. Photo: Courtesy of Nordstrom

Rent the Runway kiosk at Nordstrom Local Melrose. Photo: Courtesy of Nordstrom

Rent the Runway has a lot: It has $337 million in funding; it has a $1 billion dollar valuation; it has millions of users; it has a popular monthly subscription service. What the digital fashion rental service doesn't have is an extensive network of physical locations. That's where Nordstrom comes in.

As of Thursday, there will be kiosks where Rent the Runway users can drop off their rentals in all three Los Angeles Nordstrom Local locations as well as the retailer's full-line store at The Grove. It extends Rent the Runway's existing drop-off network, which includes select WeWork locations across the country. There are also plans to allow users to pick up their Rent the Runway rentals from these Nordstrom locations as well in the coming months.

It might feel like an unlikely partnership: What could Nordstrom stand to gain from facilitating the expansion of a company championing the "closet in the cloud," or the idea that we needn't own anything when we can just rent and return our wardrobe?

"We both agree and are aligned in the fact that pickup, drop-off, styling and fit are important services to customers and, at our scale, we obviously offer an opportunity for Rent the Runway to offer those services to their customers," Shea Jensen, Nordstrom's SVP of customer experience, tells me ahead of the launch. "Nordstrom is a company that we look up to that is hyper-focused and singularly focused on service and I think that's something we really are focused on at Rent the Runway as well," adds Maureen Sullivan, Rent the Runway's chief operating officer.

In West Hollywood in December 2017, Nordstrom opened its first Local location, a space that offers services instead of inventory: personal styling appointments, buy online/pickup in store, tailoring and even manicures, all at the convenience of the neighborhood in which it's located. Suggesting the concept has done well, Nordstrom has opened two more in L.A. and has plans to expand to New York this fall. The Rent the Runway partnership is one element of a larger strategy around service, convenience and local markets that Nordstrom is focusing on in today's turbulent retail landscape, and it's using Los Angeles as the testing ground.

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"As we've been focused on providing accessibility and greater convenience to customers who want to access our core services like styling and fit and pickup and return, we've heard that it’s really valuable to them and they've become somewhat attuned to the experiences that are built around how they live their life," says Jensen. "As we think about our customer-centered strategy, it draws us back to our local-market strategy, which is essentially how we can serve customers in the local markets." In terms of both customers and locations, L.A. is Nordstrom's largest market. "It's an important market where we have to get it right," adds Jensen. "I think of it more like a starting point rather than purely a testing ground."

Photo: Courtesy of Nordstrom

Photo: Courtesy of Nordstrom

A big part of this convenience strategy harkens back to Nordstrom reputation as store where you can return pretty much anything, at any time. The retailer wants to leverage its store footprint to facilitate returns and pickups, "whether they bought them at Nordstrom or not," Jensen explains. In L.A., Nordstrom Local is also testing a partnership with Narvar, a platform that offers digital retailers a network of locations from which their customers can choose to pick up and return online purchases. Nordstrom is also set to debut a partnership with digital hospitality service Hello Alfred, though exact details remain scarce.

As the popularity of online retail has grown, it has not spelled the death of brick-and-mortar so much as it's become increasingly clear that an omnichannel system that leverages both digital and physical retail in a harmonious way, is an effective strategy. And it's interesting that Nordstrom is now helping other retailers with omnichannel.

With Rent the Runway, the ultimate hope is that subscribers who come in will also take advantage of Nordstrom's other services. "We're excited to explore ways we think our stylists can connect with the Rent the Runway customers and time will probably tell," says Jensen. In the meantime, both parties are in it for the data. "The L.A. market is such a massive market for us and we really haven't had a physical presence," says Sullivan. "We're going to have really incredible data around who's using [the kiosks], at what frequency, what other services from Nordstrom are they utilizing when they come to drop off, so it really is a treasure trove of data and insights that will help us define the future of the partnership." And, yes, Sullivan does believe that there's a space for permanent purchases in the sharing economy Rent the Runway is perpetuating. 

"The past in fashion was kind of high-low, meaning splurge on a few things and buy fast fashion for the rest; we believe the future and where consumer behavior is going is: buy the pieces you really love that you know you're going to wear 50 times a year — invest in those pieces and rent the rest," says Sullivan. "We think the marriage of both of our customers coming together is to figure out what does that look like, how does that vision come to life for a customer? And I think what it really comes down to is just convenience."

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