SALLY HERSHIPS, HOST:
Dana Truempy is 23. She's a software engineer, and she lives in Austin. And she used to shop at H&M.
What kinds of stuff did you buy?
DANA TRUEMPY: I had this pair of jeans that I really liked. They were, like, this sage green color that was really nice.
HERSHIPS: Oh, like fun jeans.
TRUEMPY: Yeah. Yeah. Yeah, fun jeans and just a few I think, like, kind of basic top-type things. It's good for, like, cheap stuff that is kind of weird and different, that you only plan on wearing a couple times because it falls apart pretty quickly.
STACEY VANEK SMITH, HOST:
Falls apart pretty quickly. So what Dana is describing - like, cheap, hip clothes that fall apart very quickly - it's from a part of the world retail known as fast-fashion. The titans of fast-fashion - H&M, Forever 21, ASOS, Zara - they'll use low-cost materials like pleather and polyester - and quick manufacturing - to bring the latest trends right off the runway and into stores at a really low price. They target young people who don't necessarily have a lot of money but want to be on trend. And these clothes, you know, they're very inexpensive, but I don't know, Sally, like, the stuff I've gotten from there...
HERSHIPS: Yeah, I agree.
VANEK SMITH: ...Like, you can't put things in the dryer - or you can once.
HERSHIPS: Right. Right.
VANEK SMITH: A lot of times these clothes feel kind of disposable, right? You wear them a few times and you throw them away.
TRUEMPY: Just being so cheap, it kind of encourages, like, compulsive shopping almost. So you buy it really quickly. And then, yeah, I've ended up with like a room full of clothes that I didn't even try on and can't even wear.
HERSHIPS: Yeah - buying too much. That is one of the reasons Dana has moved on from H&M, but there is another reason. It's more serious. It's guilt. Fast-fashion has kind of a bad reputation for poor labor practices, for being bad for the environment. And a lot of young shoppers like Dana - Gen Z and millennials - they feel the same way. They're worried about what they buy and which brands they buy from.
How much does being a conscious consumer weigh on you when you're shopping?
TRUEMPY: A lot. I think that's where a lot of the guilt comes from when you know there are better alternatives.
VANEK SMITH: So Dana made a change. She says she is trying not to buy any new clothes, and if she does, she's looking for things that are going to last and that are manufactured ethically. H&M knows that more and more of its shoppers are thinking like Dana, so it's trying to make this big shift away from disposable clothes, and the way it's doing it is kind of unusual. This is THE INDICATOR FROM PLANET MONEY. I'm Stacey Vanek Smith.
HERSHIPS: And I'm Sally Herships. Today on the show, what H&M is doing to hang onto its conscious, young, hip shoppers. It's the way a lot of the massive retail sector seems to be moving. It is the wave of the future. Stay tuned.
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VANEK SMITH: So H&M has a problem. It sells fast-fashion, one of the best in the business. But its customers are mostly young shoppers like Millennials and Gen Z-ers. And they increasingly care about the environment and about labor practices. So H&M is trying to go from being seen as, you know, just a store where you can buy something quick and hip and cheap and disposable to a more conscious kind of brand. And it is doing that by offering rentals
VANEK SMITH: Yes. So if you're a customer who is part of the H&M Loyalty Program in Sweden, you can now rent clothes at the flagship store. You can even go get your clothes mended there, repaired at H&M.
HERSHIPS: Yeah. And rentals are becoming super common for retailers. Like, all these different brands are getting on board like Banana Republic, Ann Taylor, Levi's, even Macy's.
VANEK SMITH: So here's how these rental services work. You pay a monthly subscription fee. At Banana Republic, for instance, it's $8. Ann Taylor - a little fancier - $95. You are allowed to have three items out at a time. Free shipping. Free returns. So it's kind of like an unending closet. You can have as many new clothes as you want each month. You do not even have to do laundry. The stores will wash or dry clean the clothes for you. At H&M, it works a little bit differently. You pay per piece, about 350 Swedish kroner or about $36.
HERSHIPS: But if you're thinking, wow, H&M, aren't these clothes kind of disposable? Yeah, not such great quality. You should know that H&M has a whole other side. The clothes the company is renting come from its Conscious Exclusive collections. They're made with sustainable materials like organic silk. And these clothes, they are way more expensive than the stuff each H&M normally carries.
VANEK SMITH: So imagine renting a strapless brocade dress for 36 bucks which is made from recycled materials that would have sold for about $250.
HERSHIPS: That's not such a bad deal.
VANEK SMITH: No. And I have a lot of strapless brocade recycle dress occasions.
VANEK SMITH: Constantly. And this also represents the kind of more sustainably made clothing that our shopper, Dana, wanted. She does not want to feel bad when she goes shopping for a party dress or for a pair of jeans. I mean, jeans and dresses, this is already fraught enough. You don't need to feel like you're destroying the planet on top above everything else (laughter).
MARYLEIGH BLISS: I think these are two generations that have been raised really being told that everything that they do has a significant impact on the environment.
VANEK SMITH: MaryLeigh Bliss is with YPulse, a youth research agency. She says Millennials and Gen Zers are generations that are worried about things like, were your clothes made by child labor? Was the fabric farmed in a sustainable way? Is the label that is making your clothing dumping toxic chemicals into a river somewhere?
BLISS: There's a really high consciousness for Gen Z and Millennials about the waste that they produce. Whether that's food waste. Toxins that they're putting out into the environment or waste in terms of what they're using and using up and then having to throw away.
HERSHIPS: And fast-fashion has this bad reputation for waste and for harming the environment. There are all these stories out there with headlines like "How Fast Fashion Is Destroying The Planet" and "Fast Fashion Is Creating An Environmental Crisis." And H&M clearly knows this. It is full of plans for how the company can be more sustainable. Like, it lets customers in the Netherlands get items delivered by bicycle.
VANEK SMITH: Yes. And H&M also has this whole campaign with instructions on how to take care of your clothes so they can last longer, things like how to clean your shoelaces or mend your jeans. And it even has a collection of clothes that were considered unsellable because they were ripped or torn or damaged. It has mended those clothes and is now selling them. So renting is part of this big push that H&M is making to look more eco-conscious. The store is hoping that it can help persuade new shoppers to buy or rent its clothes, and also to prevent shoppers like Dana from leaving.
HERSHIPS: And seeming more eco-conscious is not just a strategy for fashion brands. All kinds of brands are trying to be seen as more environmentally conscious and to make their consumers feel less guilty. So this is just like when Burger King started offering fake beef.
BLISS: Plant-based meat is another great example. And young consumers are for sure contributing to the popularity of plant-based foods. We see that clearly in the data. And, you know, their consciousness around how all of their behavior impacts the environment is something that we're looking at very closely and all industries really need to be aware of.
VANEK SMITH: MaryLeigh says, so far, H&M's strategies seem to be pretty popular with its customers. Her company did a survey and found that about 12% of millennials have rented clothes and about 6% of Gen Z-ers. Which means there's this whole other reason that H&M is renting - competition. It has got to keep up with its competitors.
BLISS: So, you know, more and more brands are participating in this because, yes, it looks better, but also, young consumers are more and more starting to choose those more eco-friendly options. And so if you don't kind of participate at the onset of those things, you are going to be left behind.
VANEK SMITH: You can't be left behind if you're fast-fashion.
HERSHIPS: No, right? Got to be fast.
VANEK SMITH: You got to be fast.
HERSHIPS: H&M is definitely going to have to diversify its offerings because I checked with our shopper Dana. She says she thinks the gesture that H&M is making by offering rentals rings a little hollow because, as she pointed out, H&M is still making most of its profits by offering fast-fashion.
VANEK SMITH: Little conveniently woke.
VANEK SMITH: Today's episode of THE INDICATOR was produced by Leena Sanzgiri, fact checked by Brittany Cronin, edited by Paddy Hirsch. And THE INDICATOR is a production of NPR.
[POST-BROADCAST CORRECTION: In a previous version of this podcast, we incorrectly referred to Gen X instead of Gen Z.]
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