Who Dares To Rent A Dress Now? Coronavirus Upends The Sharing Economy

Jun 1, 2020
Originally published on June 9, 2020 7:02 pm

Updated on June 9 at 2:40p.m. ET

Kim Timko used to rely on Rent the Runway for dresses for weddings and parties, outfits for date nights, and professional clothes for her job as a lawyer in New York. She said the clothing-rental service is "a nice way to have expensive clothes without having to buy."

But weddings have been postponed, parties canceled, and Timko is working from home during the coronavirus pandemic. Like many others, she has put her Rent the Runway subscription on hold. She may even cancel it.

She said renting expensive clothes just isn't worth the money right now — or the risk of getting the virus — as unlikely as that may be.

"Any packages I get, I wipe them down," Timko said. "You can't really do that with a dress. A $600 dress or something — you can't, like, Lysol it."

Rent the Runway CEO Jennifer Hyman said in a statement: "While there is no evidence to suggest that [COVID-19] is spread via surfaces like fabric, all our garments, accessories, hangers, and reusable packaging are meticulously cleaned and steamed each time they are returned to us, and then sealed in plastic to protect them from any elements— including human touch—that they may encounter in transit to the next customer."

Still, the company has taken a big financial hit from the pandemic. It has laid off and furloughed employees, and temporarily closed its retail stores.

Like Uber and Airbnb, Rent the Runway was founded in the wake of the Great Recession. Fueled by mountains of private capital, these companies tapped the power of smartphone apps to make it easy for strangers to share their cars, homes and even clothing. Along the way, they upended the traditional taxi, hotel and retail industries.

Now the pandemic may upend them. As another recession looms — this one paired with a health crisis — these businesses' survival depends on convincing customers it is safe to share at a time when health authorities are warning everyone to keep their distance.

The new safety regime: disinfectants and masks

Rent the Runway is not the only company emphasizing its cleanliness and safety rules to reassure customers.

Airbnb has created new cleaning protocols for hosts, including training on how to disinfect a home in partnership with former U.S. Surgeon General Vivek Murthy.

Uber and Lyft now require drivers and passengers to wear masks. They are also giving cleaning supplies to drivers. Uber is even using facial scanning technology to ensure drivers are complying.

These measures are meant to address the immediate concerns of stopping the spread of the virus. But businesses built around sharing also are being forced to adapt to a reality where customers are far more cautious about anything that brings them in proximity with other people — and, potentially, the virus. Some companies are seeking new ways to win over people's trust.

As lockdowns lift, Airbnb sees a rise in weekend getaways

International travel is pretty much off the table right now. So is renting a shared room or apartment. The short-term rental platform Airbnb expects its sales this year to be, at best, half of what they were last year. It has cut 25% of its workforce as it tries to squeeze costs.

But Airbnb said people have started to plan trips again. More people booked stays in the U.S. between May 17 and June 3 than during the same stretch last year, the company said. Notably, though, Airbnb has not said how much bookings plummeted at the lowest point of the pandemic.

In a reflection of the ongoing threat of the coronavirus, about half of recent bookings are for rentals within 200 miles of where people live. In other words, they are choosing destinations to where they can drive.

Murry Evans got tired of being cooped up in his Atlanta apartment.

"I'm sitting in my condo here in Atlanta, just on Zoom all day long," he said. He has used Airbnb for a couple of weekend getaways to the North Georgia mountains.

"It's just been to get out of the house and get into the outdoors where I can go hiking," he added.

He said staying at an Airbnb in the mountains feels like less of a risk than going to movie theaters, which have recently reopened in Georgia. He brings along disinfectant wipes to clean frequently touched surfaces such as doorknobs and refrigerator handles.

"My sense is if I take the proper precautions, it's going to be just like I'd take the precautions when I'm in my own home," he said.

Trading a crowded bus for car-sharing app Turo

For some sharing companies, the pandemic may even create opportunities for more business.

The app Turo lets users rent other people's cars. Alexis Jordan is using it to commute from her Washington, D.C., home to her job at Suburban Hospital in Bethesda, Maryland — a trip that she took by bus before the pandemic.

Jordan said she does not feel comfortable on public transportation right now.

"A lot of people would get on the bus and not wear a mask. And I just felt like Metro wasn't really taking the proper precautions," she said. "I felt more exposed."

She considered taking Uber or a taxi but was reluctant "because I'm still in close proximity with someone else," she said.

Now she wears a mask when picking up her car and, like Evans, carries wipes to clean the steering wheel and door handles.

In early April, Turo's bookings had dropped 75% from a year ago — similar to the ridership drops Uber and Lyft reported at the height of the pandemic. But Turo said demand is starting to come back, with bookings over Memorial Day weekend down 11% from a year ago. Uber is also seeing more rides during rush hour in cities that are lifting stay-at-home orders, according to Andrew Macdonald, head of its global rides business.

At Turo, the rebound is being driven by local trips, thanks to commuters such as Jordan and others who just want to get out of the house.

People want to take "leisurely drives," said Andrew Mok, Turo's chief marketing officer. "They book a car, they drive up Pacific Coast Highway or they drive down to Santa Cruz from San Francisco and they drive back home."

The economic toll of the pandemic could also encourage more people to start renting their cars on Turo, Mok said.

"In a recession, folks are going to be looking even harder to make ends meet," he said. "If they can share their cars for a few days a week or a few days a month to offset all or most of their vehicle expenses, they're going to really consider doing that. We think that's going to be a huge tail wind for car-sharing on Turo."

Jordan may be one of those people. "I don't really see myself getting on any public transportation for a while, maybe a year or two," she said.

She said she is thinking about buying a car — and renting it out on Turo.

Copyright 2020 NPR. To see more, visit https://www.npr.org.

ARI SHAPIRO, HOST:

Airbnb, Uber, Rent the Runway are all companies that have thrived by convincing people to share - homes, cars and even clothing. Now, people have stopped sharing during the pandemic for fear of spreading the coronavirus, and some of these sharing companies are evolving to meet the challenge of a recession paired with a health crisis. NPR tech correspondent Shannon Bond has more for this week's All Tech Considered.

SHANNON BOND, BYLINE: Kim Timko used to rely on Rent the Runway. She used the clothing rental service to get dresses for weddings and parties, outfits for date nights, professional clothes for her job as a lawyer in New York.

KIM TIMKO: It's, like, a nice way to, like, have expensive clothes without having to, like, buy.

BOND: Then COVID-19 hit. Weddings have been postponed, parties canceled. She's working from home. She says right now, renting clothes just isn't worth the money or the risk of getting the virus by touching items that other people have worn.

TIMKO: Any packages I get, I wipe them down. I'm, like, sanitizing them. So you can't really do that with a dress. Like, you can't, like, Lysol it.

BOND: So Timko, like a lot of other Rent the Runway users, has put her $159 monthly subscription on hold, and she's thinking about canceling it entirely. Rent the Runway says there's no evidence the virus spreads through clothing, and it thoroughly cleans all items between customers. But the company admits it's taken a big financial hit from the pandemic. It's laid off and furloughed staff and closed its stores. And it's not the only sharing company that's been squeezed.

(SOUNDBITE OF MONTAGE)

UNIDENTIFIED REPORTER #1: Airbnb is laying off nearly 1,900 employees.

UNIDENTIFIED REPORTER #2: Thirty-five-hundred employees at Uber learned they were losing their jobs...

UNIDENTIFIED REPORTER #3: Lyft has laid off about 17% of its workforce.

BOND: These companies were all founded after the Great Recession. They upended traditional industries by giving people a way to enjoy expensive things without having to buy them outright. But now the pandemic is threatening to upend their businesses.

Airbnb expects its sales this year to be, at best, half of what they were last year. But the company says people have started to plan travel again to places they can drive to. Take Murry Evans. He's sick of being cooped up in his Atlanta condo, so he's booked some weekend getaways to the north Georgia mountains.

MURRY EVANS: It's just been to get out of the house and get, you know, into the outdoors where I can go hiking and that kind of thing. And it's been fine.

BOND: Evans says staying at an Airbnb feels like less of a risk than going to movie theaters, which have recently reopened in Georgia. He brings along disinfectant wipes to clean doorknobs and refrigerator handles, the places people touch a lot.

EVANS: My sense is if I take the proper precautions, it's going to be just like I'd take the precautions when I'm in my own home.

BOND: And for some sharing companies, the pandemic may even create opportunities for more business, like Turo, a service that allows you to rent other people's cars. Alexis Jordan has been using it to get from her home in Washington, D.C., to her job at a hospital in Bethesda, Md. Before the coronavirus, she commuted by bus.

ALEXIS JORDAN: A lot of people would get on the bus and not wear a mask. And I just feel like Metro wasn't really taking the proper precautions. I felt more exposed to it.

BOND: Uber didn't seem like a great option, either, even though the company is now requiring all drivers and passengers to wear masks.

JORDAN: Because I'm still in close proximity with someone else.

BOND: She wears a mask when picking up her car and carries wipes to clean everything she touches. Turo says demand is coming back, thanks to commuters and people who just want to get out of the house. Uber is also seeing more rides during rush hour.

Alexis Jordan says it could be a year or two before she gets back on the bus. She is considering buying her own car and renting it out on Turo to help cover the cost.

Shannon Bond, NPR News, San Francisco. Transcript provided by NPR, Copyright NPR.