Drip: A monthly membership giving access to luxury streetwear wardrobes
Her-Age Team has interviewed Augusto D’Auria, Co-Founder of Drip, a digital platform to rent streetwear and high fashion clothing and accessories with a monthly subscription.
Through its service, Drip caters to Millennials and Generation Z users who want to wear the best streetwear brands, which are often inaccessible due to both high prices and the limited availability of the products, which are often released in limited quantities.
Augusto, can you tell us about yourself and your background in the fashion industry?
I was born in 1997 and have always been a technology enthusiast with a passion for digital innovation. My first jobs as a teenager were for my parents' newspaper, where I worked on building the entire web infrastructure. Later on, I became involved in the startup ecosystem and led the first incubation program in Naples, discovering the lean approach and this wonderful world of dedication and sacrifice. I then gained experience working at a startup accelerated by LVenture until I decided to leave my job and my studies in Business Administration to pursue a new path where I could merge my two passions: innovation and fashion.
As a Co-Founder. What is the concept of Drip, and how was it initially born & developed?
We used a more scientific approach than what is usually read about. We had a perimeter that included the luxury fashion industry and the generational segment. On the other hand, we were well aware of the great pollution problem in the fashion industry. Studying foreign markets, we became passionate about the rental clothing model. Within a month, we went to a boutique in our area, asked to take photos of clothing items with our logo, customized a shop with Shopify, and launched what is commonly referred to as a smoke test. In practice, we had nothing, but we made it seem like we had everything. As soon as a purchase was made, we refunded it, and in about a week, we generated initial validation to approach investors.
Drip is a monthly streetwear and high fashion membership for those who want to express who they are with a different consumer choice. What are the offered memberships and how does Drip work?
Since the first model, things have changed a lot. We added the concept of subscription to shift our value proposition towards a model that serves the daily lives of all fashion enthusiasts. The one-shot rental model solves the need for a garment for an event, while Drip works to provide a dynamic and high-quality wardrobe through a fixed monthly fee. In terms of vision, we could say that we want to change the rules of fashion through a new consumption model. It's not just about those who have more spending power, but especially those who "know how to do it better". In this sense, in the future, we would like to test product features to offer increasingly exclusive items through a mechanism of "seniority" and "specific actions". Think of it as adding a level of gamification within rental clothing. We have 5 subscription plans ranging from a minimum of €59.00/month to a maximum of €199/month. On average, our premium plan allows access to items with a total value of over €2,000/month. There is no limit on products, and insurance and cleaning are always included in the price. Furthermore, many of our customers use our service for the opportunity to try on a garment before making a final purchase. By wearing the clothes, customers have the chance to discover the details and only after being sure of making an informed choice, they proceed with the purchase. Actually, our catalog includes over a thousand products from top brands such as Moncler, Off-White, Palm Angels, Fear of God, Balenciaga, and many more.
Niche brands finally have a chance to build genuine, meaningful relationships with their customers in order to build long-lasting bonds. In your opinion what is the main ingredient to form this kind of lasting relationship with your customers?
We rarely use the word "rental" in our promotional messages. For us, communication, from the tone of voice of our brand to the visual identity, has always been a key point to work on. We believe that those who use Drip first embrace the core values of our brand. In my opinion, the best way to build a stable relationship is probably the same recipe I would use in my personal life and relationships: honesty, transparency, and mutual value. Only by giving a lot, will it be possible to build a relationship with our community and receive maximum loyalty in return. The numbers are proving us right. After the first month of subscription, only one out of seven customers leaves the service.
In a world where ecommerce is evolving and customers are craving creativity and something new, how can companies and brands maintain the growth of their audience and create real opportunities to build their business and reach their target?
Keep in mind that the competitive landscape is getting stronger and this applies to all points of the customer journey, from social media advertising to distribution channels. I believe that it is essential to first have a deep understanding of the industry and make it your competitive advantage, and then use an analytical approach rather than relying solely on intuition. In the early stages, qualitative research is essential to understand what customers really want and if there are any points of friction during their journey. Then, set hypotheses and use an iterative testing approach at all levels of the organization.
What have been the problems you encountered in Drip running a business of such a business model?
I admit that the rental model is probably one of the most complex to launch in the industry nowadays. The sales process involves purchasing and subsequent shipment (from your own warehouse or, even better, from third parties). In our case, we have to deal with outgoing logistics and subsequent return of goods that consider condition and authenticity checks, then washing and storage. The time it takes to perform these operations is crucial. Customers pay a membership fee, and we must always ensure the shortest possible shipping time and the most comprehensive catalog. While there are many challenges, the required know-how is definitely a barrier to entry for new players.
How is Drip helping in boosting the circular economy? What are your sustainable promises?
Rental clothing, along with second-hand clothing, is one of the new consumption models that seem to have a lesser impact compared to the overconsumption that fast fashion has accustomed us to. There is increasing research trying to understand how rental helps the planet. As for us, up to now, we have never wanted to expose ourselves to our consumption because it requires a thorough study, but every time we are faced with a choice, sustainability is always something we evaluate. This applies to our packaging, which is completely reusable, to carbon offsetting with our logistics carriers. I can anticipate that we are starting a collaboration with a promising sustainable vertical fashion startup to precisely understand how our subscription impacts the planet for our users.
Drip's vision of Prada Future bag
What is the future of luxury rentals in your opinion, do you think we will reach a time where people will prefer renting clothes instead of buying ?
We are talking about a change that has already happened in the automotive industry, for example. In fashion, we are still far from those numbers, but if we didn't believe in it, we wouldn't be here. Looking at some reference data, on average, 18% of consumers have rented luxury goods in the last year (a 13% increase compared to last year), with a peak of 21% for Millennials and Gen Z)* and rental is estimated to grow 25% by 2030, compared to 5% growth for traditional sales (volume growth)**.
How do you see Drip in the coming years ?
Difficulties are always around the corner and unfortunately, the market and product are not the only things to keep in mind in the growth and construction of a startup. As an organization, my main goal is definitely to create a context of young talents in which it is possible to think outside the box and have all the benefits for a healthy and balanced life. From an external point of view, I certainly hope that we will be able to expand in Europe as soon as possible, since no player has a significant market share. Additionally, I want to emphasize that one of our pillars is to create a strong concept of cooperation with other innovative solutions in fashion and with all the young designers who will be the big names of tomorrow. We recently launched "Next," an initiative in which we select and promote emerging brands, discovering new potential big-hitters with innovative ideas and designs. We want to give our community the opportunity to have a unique style through exclusive products that are all waiting to be discovered. Sales are not the only solution, and we intend to make this clear not only to consumers but also and especially to brands that care about their values.