A study of footwear industry in India, and exploring entrepreneurial opportunities

Abstract

It is interesting to note that, “learning by doing approach” was used by Rent the Runway venture while it was still in the very initial stage of setup. They sequentially carried out controlled experiments to test their hypothesis to understand the consumer-problem-solution fit and then go ahead with their venture. The founders first went on to experiment with the hypothesis, of whether the consumers would be interested to buy clothes on rent. They went to college students and gave them an opportunity to rent the clothes. The clothes were present in physical form, while the decision was made by the consumer. Next when this was established, they went to another college and performed a similar study, only this time instead of having the physical dress with them, they took a catalogue of their products. This gave them the learning that consumers are comfortable in buying dress on rent, and can make decision based on a catalogue. The final experiment they carried out with another bunch of college students when they actually leased out the dress. The key matrix they studied was how many dresses were returned on time and undamaged. It turned out that consumers take good care of dresses and most of them returned the dresses on time. These learnings by doing were later used by the company to start their venture and soon Rent the Runway became a hit. In this CCS a similar approach is used to explore entrepreneurial opportunities in footwear industry.