When you rent a bike on vacation, you can explore more. You can look fabulous without spending a fortune when you rent an evening dress. Renting expensive camera equipment allows you can shoot a film on a budget. The rental economy is a powerful movement that enables people to achieve their goals while being affordable, sustainable, and flexible.
These are just a few use cases where the rental economy is beneficial to the lives of people around the world. It’s no wonder that as we have become more conscious of how we spend money and how we use products, the rental economy has begun to explode. Let’s explore how this rise happened and what it means for the future of the rental industry.
What is the rental economy?
The rental economy represents an evolution in how consumers interact with products and businesses. For a long time, people have bought products to achieve tasks and simply left them to be covered in dust and discovered years later. However, society has a growing consciousness, and for many, the cost and waste aren’t worth it anymore.
It is much more practical and sustainable to rent products as and when we need them. Not only does this reduce the cost of entry, but it also extends the life of a product from a few uses to hundreds. This reduces the amount we waste and allows more people to achieve their goals with less economic and environmental obstacles.
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What products are rented the most?
Products are usually rented to complete a task or solve a problem. For example, bike rentals enable people on vacation to explore a greater area than they can on foot. This means that the most rented products are the ones that would either be too expensive to invest in for the task at hand or are only needed for a short period where buying them doesn’t make sense.
The most rented products are:
- Bikes and scooters
- Furniture (for homes and events)
- AV and cameras
- Boats and kayaks
- Tools and equipment
- Motor vehicles and trailers
- Technology
- Home appliances
These products are rented on an as-needed basis and have seen massive growth over the past decade. This has brought the rental economy forward and allowed it to continue growing with no signs of slowing down. It may seem like it’s a step away from consumerism, but it is just a much more pragmatic approach to interacting with products and experiences.
What are rental experiences?
The rental economy does not only benefit single products; it has also given rise to rental experiences. Customers can rent everything they need to experience something that would otherwise be too costly. For example, Campers and Kit offers outdoor adventure experiences that include a campervan and a choice of mountain bikes, kayaks, and hiking gear.
Rental experiences are becoming popular because people no longer have to rent from multiple vendors and hoping they’ll all have what you need at the same time. Instead, they can rent everything from one company with the assurance that you’ll get what you want. In addition, renting everything from one vendor is much more affordable and practical than seperate vendors.
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Why do people choose to rent over buying products?
A recent survey showed that 55 percent of respondents rent products if they need a temporary solution. Whether renting a bike for a day or renting furniture for a short period in a temporary living situation. At the same time, 43 percent of respondents rent because it is less expensive and more convenient than buying an identical product from a retailer.
It is fair to say that most people rent products because they are more affordable and flexible than buying them. However, there is a growing market of consumers that rent something before making a purchase decision. It offers commitment-free use of a product that you can use for a couple of days rather than living with for the rest of your life.
Although, there are a couple more reasons why the rental economy is growing.
Rentals are more environmentally-friendly
Research has shown that even though very few millennials will rent for environmental reasons, 73 percent would pay for more sustainable offerings. This is a result of the growing environmental-friendly attitude among consumers that has led to companies like IKEA testing subscription offerings to appeal to these consumers and boost their credentials.
There is a growing appeal to the intention that both consumers and brands would move towards rentals as they desire to act more responsibly toward the planet. For example, city centers across Europe have e-bike rentals grow in popularity, and clothing rentals are now seen as a way to stem the environmental damage caused by the fashion industry.
Renting encourages more efficient use of products, which leads to a decrease in the use of natural resources and pollution. It also allows customers to be more careful with how they spend money. This means that less is wasted from purchases of products that are only used once and the lifetime of products is much longer than previously.
The effect of technology on the rental economy
In addition to the reasons discussed above, one more vital factor has led to the growth of the rental economy. It may seem obvious, but technology has had a massive impact on how customers interact with rental businesses. The advancement of the digital world has given rise to eCommerce, and now everyone can buy anything from wherever they are.
There has been a slower uptake of digitalizing services for the rental economy, but over the past decade, it has steadily grown. Rentals are now easier to access than ever before, and many of us use them daily. Now, more rental businesseses the availability of products and all customers to reserve and pay instantly with their onlines store.
Digitization has also given rise to a continuous dialogue between customers and businesses and placed them at the center of everything. After all, customers validate the digital solution companies adopt and can influence others. Social proof is much more accessible now, and the ability to review brands means customer service and satisfaction are more significant than ever.
