Ownership is Over: Why Your Closet Has No Value
In a recent article for WWD, Zuora’s co-founder and CEO, Tien Tzuo, declared 2019 the end of the ownership era. With the aid of platforms like Spotify or Netflix, the way we consume has undergone a radical shift. Rather than having to own a movie on DVD to watch it, we can stream it with Netflix; rather than having to buy a car, we can borrow one for the day with ZipCar. Spotify retrospectively makes the idea of owning a towering stack of CDs with every song we listen to nonsensical and obsolete. The sharing economy found growth on the heels of the recession— with younger generations seeing the accumulation and debt of their parents, services like Uber and AirBnb gave them a way to find more variety with less clutter and junk. The sharing economy has made ownership has become an unnecessary burden. With the rise of subscription services, rental, and the sharing economy, the focus isn’t on ownership, but access. The burden of stuff is an outdated one, so why is apparel still so driven by ownership?
Ownership is a Consumer Dream of the Past
Consumer habits are tangibly changing more rapidly than ever before, yet the clothing industry is stuck in an outdated model. As we as consumers increasingly prioritize variety, sustainability (both environmental and personal) and flexibility in our lives, traditional apparel models fail to meet these needs. In contrast to the boom of the sharing economy, the apparel industry still relies on convincing consumers that more is more. Consumers, and women in particular, are told we can never own too much clothing, we need a different pair of shoes for every outfit, and we can never be seen in the same outfit twice. It’s a simple model: convince consumers they need to own as much as possible in order to maximize their profits.
This poses a few problems for consumers. Firstly, the monetary cost of ownership is higher than ever before. According to Business of Fashion, the “prices of fine watches and jewelry have nearly doubled since 2005,” and Louis Vuitton’s famous Speedy 30 handbag has seen a 19% increase in price per year since 2016. Because of this, more and more consumers are looking to alternative models of ownership. Additionally, the rise of subscription services, like Zipcar, have consumers wondering what the real value in ownership is. We’re taught to buy trendy, expensive garments as “an investment” (despite the fact that trendy and timeless are inherently antonyms), thereby branding clothing as an asset. The more clothing we own, the greater our assets are. In reality, clothes go out of trend and get worn down, leaving us with “assets” that aren’t really worth anything. And how do we as consumers combat this? We buy more, like we’re told. The cost of ownership is higher than ever before, making it an outdated and unachievable value for consumers.
The End of the “More is More” Mentality
“Next-Gen” brands like Everlane, Of Mercer, or Brass, combat this “more is more” mentality by driving down the desire to own as much as possible. Rather than the all-too-familiar endless scroll associated with fast fashion or department stores, these brands focus on producing timeless, quality pieces. Their websites only show a handful of select items, each in three, maybe even four, different colors. When consumers aren’t shown fifteen nearly-identical trench coats, with slightly different cuts, buttons, or colors, we don’t feel like we need to own fifteen different trench coats. Their pieces are versatile and built to last, with women in mind (think: pockets and comfort!). These brands replace the dream of the bottomless walk-in closet with one that is more achievable. Their dream closet chooses quality over quantity. More minimalistic, yes, but more functional, affordable, and modern. The desire to own everything we can is officially one of the past.
The Tipping Point in Favor of a New Model of Ownership
Despite the movement in favor of timeless pieces, the desire to meet trends persists for consumers and retailers alike. With the rise of fast fashion, new trends are pushed at breakneck speeds, and staying up-to-date is more of a challenge than ever before. The new norm of 50+ fashion seasons (compared to the traditional 2) makes the idea that we can buy enough to stay on-trend an impossible goal. From music to movies to cars, the cost of ownership is deterring, and apparel is no exception. The apparel industry needs to find a way to provide consumers with access to trends without the burden of ownership.
The cost of ownership doesn’t need to be a loss of variety. As consumers, we want to embrace a new model of consumption which isn’t reliant on ownership. Clothing rental (like Armoire) has been a key player in this movement, providing consumers access to trends and quality without having to buy into a market which places ownership as good investment. Like all things, clothing is constrained to the infamous Trade-Off Triangle. Apparel can be on-trend, affordable, or high quality, but traditional retail doesn’t provide a way to meet all three. Rental provides a way to access trendy, quality clothes without the high cost of ownership. Rather than a niche consumer desire, rental is indicative of a larger shift in consumer desires: a means of sustainable access.
The success of consignment businesses like the RealReal (with a market cap of $2.32B) enforce the need to meet these demands. BoF projects the resale market to be bigger than fast fashion within 10 years. Mitigating the cost of ownership allows consumers to access the apparel they desire in a way they actually want. Providing access without the need to own requires us to fundamentally change the way we consume.
The dominant economic model is an outdated one, and consumers want a new way to consume. The cost of ownership is out of reach for the average consumer, so the apparel industry should find a way to meet consumer needs on both fronts: stop enforcing the “more is more” mentality, and find a model that focuses on access, not ownership. The desire for access without ownership is a fundamental shift in the evolution of consumer behavior overall, and one the apparel industry needs to adapt to in order to stay relevant.