One of 33-year-old newlywed Nam Ji-hyun’s newfound hobbies of late is to cook roasted meals for herself and her husband after work, using her rented oven.
Nam, who lives in a two-bedroom apartment with her husband of one year, rented the Balmuda Toaster oven for one month at 21,900 won ($20.45). The oven retails for over 300,000 won ($277.16). Not an everyday home cook, she found it wasteful to splurge on a full oven, but wanted to try a few simple recipes for two. Renting seemed like the best-suited option for her temporary needs.
“I’ve tried all the recipes I wanted to try, like small pizzas and roasted meat. It was fun, but I found myself using the oven less often as time went by. So I returned it,” said Nam.
Others like Nam say rental services are adding a new spice to their quality of life, allowing them to enjoy comforts that lie a little outside of their income range. More and more rental services have popped up in Korea recently, offering temporary use of luxury items at affordable prices.
Rental website and mobile app Myomee was launched by Lotte Rental in August last year. Available are everything from high-end hair dryers and flat-screen TVs to Stokke strollers, children’s toys and home gym gadgets.
The concept is to allow customers to “create a better life” through a new way of spending, according to Lotte Rental’s You Ho-seong. The company targets “trysumers,” a term referring to consumers who want to judge products after experiencing them fully.
Online retailer Auction this month launched a temporary rental service for newlyweds. The service offered usage of home appliances at around 33,000 won ($30.48) per month.
“Newlyweds are able to try using Dyson vacuum cleaners and LG air purifiers at prices that are easy on the wallet,” said Lee Jin-young, head of Auction’s Living & Leisure Sales Division, citing popular home appliance brands. “We decided to prepare this service after seeing a trend among newlyweds of saving living costs through renting.”
The increased demand for rental services is rooted in Korea’s decelerating wage increase rate, according to Choi Chul, professor of consumer economics at Sookmyung Women’s University. It’s also coupled with a growing need to fulfill high-end tastes, said Choi.
Today’s Korean consumers are experiencing a slowing down plateau economy. They’re responding by allocating their income more effectively, Chou noted.
“At the same time, there is a need to fulfill tastes that have become open to more expensive lifestyles. Rental services can match that specific demand, especially for durable goods such as home appliances.”
The phenomenon can be seen as an extension of the sharing economy trend, Choi says. With multiple users renting one product at different times, “the total benefits for consumers increase, through less total expenses,” he said.
The spiked interest in indoors activities, such as cooking, eating and creating home bars and home cafes is another contributing factor to the rental fad, reports say. Rental industry, rosy future or still unstable?
Korea’s rental market size has grown some 48.6 percent since 2011, standing at 25.9 trillion won ($23.9 billion) as of 2016, according to a report released by the KT Economic Management Research Institute. The report estimates the market will grow to some 40 trillion won in 2020.
Reports say the growing number of one-person households bodes well for the rental market. They also point to the simultaneous trend of minimalism and desire for stylish living among Korean youths.
Fashion aficionado Jung Song-joo, 26, dislikes clutter, is unable to afford designer items on her salary, but enjoys trying out different styles. She’s an avid user of clothing rental services such as SK Planet’s Project Anne.
“Rental costs are less than half of what I would normally spend on shopping. If you’ve tried the outfits several times and have had enough of the style, or want to try something new, you can return the clothing without blocking up your closet. There’s no need to dry clean the clothes, either,” she said.
Despite enthusiastic responses from such users, it may take a while for rental services to settle on a consistent profit model. Project Anne has decided to close down its services starting April. Other clothing rental platforms such as The Closet, Wing Closet and One Two Wear all popped up around 2016 and 2017, but soon disappeared.
Launched by SK Planet in 2016, Project Anne allowed users to rent niche brand clothing, bags and accessories. It had amassed some 33,000 subscriptions before its closing.
“It came to a point where more investment, including buying new clothes each season, building infrastructure for shipping, etc. was needed for the service to keep growing and gaining new subscribers,” said SK Planet’s PR manager Lee Kyo-taek. The company decided to rather focus its resources on its e-commerce platform 11st, Lee said.
Some services, including Lotte Department Store’s Salon de Charlotte, are still standing. The shop first opened at the Lotte Department Store’s main branch in Jung-gu, Seoul in 2016. A second shop opened at the department store’s Jamsil branch in May last year, after the service enjoyed considerable profits the previous year, reports say. Salon de Charlotte rents out luxury clothing such as wedding dresses, bags, jewelry and men’s suits.
Nam says she plans to rent more things from rental platforms, including expensive speakers or, when the time comes, a luxury brand stroller for her baby. “Some people might think it’s a little bit like cheating, to enjoy things outside of your budget. It’s like you’re jumping over your income group. But it seems like everyone has access to more luxuries nowadays.”
By Rumy Doo (email@example.com