“Clothing rentals have gone from something a
couple of startups were doing to something being
adopted by old-school retailers,” says CaaStle founder
and CEO Christine Hunsicker. She would know: In 2012,
she launched Gwynnie Bee, a subscription service that
now offers clothing rentals from more than 150 labels in
sizes 0 to 32. But Hunsicker saw even more opportunity
in helping retailers and clothing brands create their
own rental services. Her two-year-old CaaStle logistics
platform integrates with companies’ inventory systems
and manages the entire rental process on their behalf,
from warehousing and cleaning garments to gather-
ing feedback from customers about how an item fits.
Hunsicker’s pitch is simple: “We help brands strengthen
their relationship with the customer,” she says. While
most people typically buy only a handful of things
from a label each year, CaaStle has found that, through
rental, they’ll wear up to 100 items from a brand—and
are more inclined to remain loyal when they do make
purchases. As CaaStle signs on customers, it’s bringing
the rental ethos to new demographics. In the past year, it
partnered with American Eagle to power the first rental
service aimed at Gen Z, Scotch & Soda to launch the first
men’s rental service, Bloomingdale’s for the first rental
service from a department store, and Banana Republic.
(CaaStle also launched Haverdash, its own multibrand
rental service for women and the most affordable one on
the market, at $59 a month.) “It’s not about moving the
customer away from retail and into rental. It’s about inte-
grating the offerings,” says Hunsicker, who is beginning
to experiment with physical spaces: CaaStle-powered
pop-ups will open next year in select Express stores.
ThredUpUsed-clothing platform ThredUp, which sells
everything from Old Navy tees to Gucci heels, received
roughly 100,000 items a day from would-be sellers in
2019 and processed its 100 millionth garment for the
site. But the 10-year-old platform broke new ground
last year as well, partnering with other retailers to find
potential secondhand shoppers, wherever they may be.
“People in their twenties and thirties were born into
[the sharing economy],” says James Reinhart, ThredUp’s
founder and CEO. “For people in their forties and older,
this consumption model requires training.” To reach
them, the company set up special secondhand sections
in nearly three dozen JCPenneys and worked with Macy’sto create secondhand sections in 40 of its department
stores. Cult denim brand Madewell now has ThredUp-
sourced “archive collections” at several of its stores.
ThredUp also partnered with companies such as Refor-
mation and Amour Vert to enable fans of those brands to
send ThredUp old clothes (from any label) in exchange
for shopping credit at their stores. ThredUp even created
its own digital storefront on eBay to woo that site’s sec-
ondhand shoppers. Meanwhile, the company is using
the $175 million it raised last year to expand its network
of warehouses, which are equipped with proprietary
technology that can price, photograph, and efficiently
distribute one-of-a-kind items. (Sellers make money
from every item sold, and ThredUp takes a commission.)
In 2019, the company added its fourth center, in Phoenix,
staffed by 500 workers, and it recently broke ground on
its fifth, which will be the largest, in Atlanta. “There are
so many clothes out there that in order to make a [sus-
tainable] dent in the universe, which is our vision, we
need to build the infrastructure,” Reinhart says.TroveIf you’re in the market for a used Patagonia
fleece, Patagonia wants to be the one to sell it to you.
Powered by the logistics startup Trove, Patagonia’s Worn
Wear website buys back items from customers, refur-
bishes and cleans them, and sells them at a fraction of
their original price. It might seem counterproductive
for a brand to want to sell lower-priced, secondhand
merchandise to customers who might otherwise buy at
full price, but Trove CEO Andy Ruben (who previously
served as Walmart’s chief sustainability officer) says that
launching a resale marketplace allows clothing labels “to
create a new revenue stream, get new customers, [and]
capture their fair share of the secondary market.” Within
six months of Worn Wear’s 2017 launch, Patagonia had
generated $1 million in sales from the site, which has
been profitable ever since. Trove has gone on to build out
its operations, so it can purchase, process, price, and pho-
tograph secondhand goods before putting them up for
sale on each brand’s dedicated resale website (Trove even
takes care of returns and customer service). It has also at-
tracted new customers, including REI and Eileen Fisher,
which has brought in more than $4 million in revenue
from its profitable ReNew resale site. Last year, Trove
added Arc’teryx and Taylor Stitch to its portfolio, and
it recently launched a secondhand marketplace for
Nordstrom. By having their own resale sites, Ruben says,
“these [companies] demonstrate their commitment to
getting more out of the clothes they’ve already made.”MOST INNOVATIVE COMPANIES 2020MARCH/APRIL 2020 FASTCOMPANY.COM 63