Rent the Runway is also making significant strides in AI, with an AI search feature that generates product listings based on specific search terms. This move towards AI is seen as a major development for consumer-facing businesses, with Hyman stating that companies will either benefit from AI or perish because of it. The use of AI in e-commerce is growing, with a recent report identifying AI as a tool to improve customer engagement, and companies like Alibaba demonstrating its potential beyond marketing and consumer engagement.
Key takeaways:
- Rent the Runway's stock quadrupled after reporting optimistic earnings, with a revenue of $298.2 million for 2023, a slight increase from $296.4 million in 2022.
- The company is leveraging AI technology to improve its site performance, speed, and user experience, with features like AI search and enhanced discovery features.
- Rent the Runway has faced challenges during the pandemic, with 60% of its audience pausing or canceling subscriptions, and has been working on restructuring efforts, including hiring a new CMO and implementing a reverse stock split.
- More retailers are seeing the potential of AI in improving customer engagement and personalizing marketing, with 70% of companies surveyed in Twilio’s 2024 State of Customer Engagement Report having used AI for these purposes.