Those who can't afford to keep up with expensive gadgets can now rent them for a taste of a more luxurious lifestyle.
My iPhone is an incredibly intimate part of my life. I use it to answer work emails, check if I'm being subtweeted, and reply to my cute pictures of my niece. It's the first thing I see when I wake up and the last thing I see before I go to bed. Could I handle a casual, chill relationship with a gadget I didn't own?
I rented $5,500-worth of gadgets to find out.
Want to try that new Jet Black iPhone 7 but can't afford the upgrade? Now you can get a taste of the technology you lust after for a fraction of the price thanks to startups that rent gadgets, from smartwatches to drones.
Grover, which launched in the US in July, is one of those startups. It hopes "to change the way consumers own gadgets," by offering the latest tech on the market at monthly rates for up to 95 percent less than the purchase price.
"Over 60 percent of the $280 billion consumer electronic industry is financed by credit debt," Grover's Founder and CEO Michael Cassau told me by phone.
Cassau's inspiration to start Grover came to him when he had to move from London to Berlin and found himself in need of furnishing an entire apartment from scratch—only to live there for a total of 10 months. "Normally, I would have to finance it all," he explained. "But then decided to rent everything for the time needed."
This "leasing" strategy falls in line with other tech startups like Spotify, Netflix, and Airbnb, in which consumers don't buy things, but simply rent what they use. Did the same strategy make sense for hardware? To find out, Grover let me order a bunch of luxury gadgets for free to feel out the rental vs. purchase process.
The gadgets that I got emotionally attached to over the course of a month are:
- DJI Phantom 3 Professional Drone: retail $799
- Apple Watch 38mm Stainless Steel Case with Link Bracelet: retail $949
- Apple Watch 38mm Space Black Stainless Steel Case with Link Bracelet: retail $1,049.00
- Bose SoundLink 3 - retail: $299
- Beats Pill 3: retail: $229
- Bang & Olufsen BeoPlay H8: retail $499
- iPhone 6S Plus 64GB: retail $849 (major upgrade from my ancient 16GB iPhone 6)
- The Samsung VR Bundle: retail: $860 (this bundle includes the Samsung Oculus and Samsung Galaxy S6 to sync together).
You're probably thinking, this is quite the list of gear to flex on people with this summer...and you're right. It was! I had a great time showing off expensive tech at rooftop parties around Brooklyn—for the grand total of about $465/month: a fraction of what this stuff would've cost to buy. All together, buying this stuff would've cost me around $5,500—aka several months' rent.
For Cassau, purchasing these gadgets only to have to upgrade them a year or so later, seems like a waste. "If you look at the needs for that transaction, it's old fashioned," he said. "Because after about 10 months, you need something newer. There is a demand for time-limited consumption."
This idea of making the most of a limited-time consumption hit me right at the beginning of my one-month trial. Suddenly, I felt an urgency to use the products as much as possible before having to send them back. This is a stark contrast to the way I've treated gadgets in the past— letting a Go Pro gather dust on my desk after the initial unboxing.
Of course, while I didn't feel the need to use items like the phones daily—beyond syncing them with their corresponding devices—I found myself reaching for what's typically thought of as more luxurious tech, like the noise-canceling headphones for train rides and Bose speakers for audiobooks (and Drake). I also became that person with the great-sounding speakers at BBQs.
As I got used to the idea of using gadgets more freely, free of the worry of wear-and-tear and cost that normally comes with gently using new items, I found myself and those around me actually enjoying them more. Flying a $1,400 drone with friends at the park had a streak of joy without the guilt of knowing I'd spent more than a month's worth of rent on a flying camera, essentially.
As my drone was flying recklessly over the park, deep down, I couldn't help but fret over the sustainable business model of renting physical gadgets prone to damage, as opposed to say...a song or movie.
With the rigorous refurbishing process to ensure quality control, and the amount of products (now over 700) offered by Grover, it's too early to tell how its customer demand will steer the company. While it's fun to rent this gear on the cheap, if the service keeps growing and people keep renting these products, will they be able to sustain their refurbished state?
As Ashish Soni, Executive Director of Digital Innovation at USC's Viterbi School of Engineering, told me, Grover's strategy hits on some definite trends of consumer behavior which boils down to wanting to own less stuff.
"People, especially millennials, want to live this mobile, portable lifestyle," Soni said. "They don't want to have a lot of things to pay for. The pace of innovation used to be a four to five year roadmap to release a new device, now there's something new coming out every couple of years."
Aarthi Ramamurthy, the founder of another gadget rental service called Lumoid, emphasized the minimalist ideology that comes with renting electronics vs. owning. "Just because you have a specific need for a gadget, doesn't mean you have to buy it," She said.
At the moment, Grover charges a 5 to 10 percent of the retail price on an item, while also takes into account its value and demand. For example, iPhones are typically high in demand long after being released, which keeps their rental price stable.
"We believe this is the way to use technology," Cassau said. "We hope that the cash trade will and lack of debt will help people along the way."
Overall, getting a taste of products I couldn't possibly afford to buy was both useful and bittersweet. For example: I now know I don't ever want to drop a grand on an Apple Watch just to read my texts, even if I could afford it. However, I was sad to let go of my beautiful headphones. And what good does that do me? I can't justify buying a pair, and renting them for a long period of time makes even less financial sense, so all a service like Grover does at that point is give me a taste of the luxury I can't afford.
But perhaps this is the real future of these service. Just in the way most people can't really own a vacation home in Hawaii but might have access to a timeshare, the future of luxury tech is letting people get a sense of what it's like to use an $800 iPhone 6 Plus without ever actually owning one.