The fashion industry has drastically changed in the last decade. While much of the world has moved online, it has changed how fashion is produced, distributed, and consumed. One of the biggest disruptions in fashion is social media’s dominance. Social media has been adopted as the new form of advertising and the main channel to build customer relationships – democratising access to learning about fashion and the latest trends.
Another highlight is the rise of ecommerce. Consumers no longer need to travel to a specific location to shop and purchase products rather they can purchase them from virtually anywhere and have products delivered directly to them. The pandemic has even further accelerated the adoption of ecommerce.
Social media and ecommerce were technologies that some brands and retailers were initially resistant to adopting, but, we now see that they are embracing these technologies to connect with their customers and build their brands.
So, what’s next for the fashion industry? We explore how new innovations and technology are being applied to fashion and retail. These new technologies are further broadening access to fashion to both consumers and producers and augmenting customer experiences that brands have with consumers.
Live Shopping
Live shopping enables brands to sell and promote products through live streaming whereby consumers can interact with brands in real-time. This is becoming more prominent in the west, particularly in the US. It’s been around in the east for some time, like in China where live shopping has been around since 2013. In Europe, adoption has been slower, but it’s starting to cotton on.
Traditional fashion brands have hopped onto the live shopping bandwagon. LVMH has signed a commercial partnership with Bambuser for the group’s labels to use their platforms. Live shopping startups are enabling brands to power their live shopping platforms such as Bleeker who is working with Galeries Lafayette and LIVEBUY who is working with Lidl and MediaMarktSaturn.
There are also standalone marketplaces that are built upon the concept of live shopping. FINDS is taking a new approach for consumers to buy and sell second-hand fashion with their video and live streaming-based marketplace. NTWRK is a livestream shopping platform that blends entertainment content and commerce featuring daily episodes and virtual festivals. Kering has acquired a minority stake in NTWRK.
Big tech has shown interest in entering live shopping. Youtube has plans to launch a live shopping product. Both TikTok and Facebook had tested live shopping features, however, they have halted the launches of their versions of live shopping features.
Augmented Reality
Over the last decade, consumers have mainly been interfacing with augmented reality (AR) through filters on social media platforms. By 2025, it’s believed that 75% of the global population and almost all smartphone users will be frequent AR users. AR can be transformative to shopping and retail experiences. The technology can simulate a digital shopping experience that is almost as realistic as shopping in-store and be impactful in enhancing physical shopping experiences in stores as well. Louis Vuitton, Gucci, and Bottega Veneta are offering AR try-on. So far, it’s shown to be capable of making a big impact. According to one report, products that showed AR content have a 94% higher conversion rate than products without AR.
Historically, there has been a lack of diversity and representation in fashion imagery. This excluded certain segments like people of colour and plus-sized individuals from being able to relate to the products that they are being sold. Augmented reality enables a personalised shopping experience which creates inclusivity and makes fashion more accessible to those who have been previously segmented. Lalaland uses AI to generate virtual fashion models of different body types, sizes, and skin complexions. When customers have a personalised shopping experience and can resonate with a model that looks like them, they are more likely to feel more comfortable with purchasing an item and can better visualise how the item will fit them. Customers want to be able to visualise exactly how products will fit and be styled on them – this helps to reduce return rates, increase customer satisfaction, and return rates.
Augmented reality is also being applied to the production and design process. Stitch 3D helps brands like Calvin Klein and Tommy Hilfiger transition towards a 3D-driven workflow.
Fashion in Web3: Virtual Reality and the Metaverse
Virtual reality is a simulated environment where users experience an alternate universe that transcends physical and temporal boundaries. In recent years, virtual reality adoption has significantly increased and changed how people socialise. The desire to immerse in virtual reality has been accelerated by global lockdowns and the pandemic. Examples of virtual reality spaces include metaverses such as Decentraland and Axie Infinity and popular games such as Minecraft and Roblox.
In virtual reality settings, users can create a personalised persona via an avatar where they can design their own physical appearance and select how they would like to clothe their avatar – effectively an extension of their IRL self.
Fashion is catching on to the power of meta, including the ability to produce digital-only products also known as “direct-to-avatar” (D2A). There’s the emergence of digital native fashion designers that defy the traditionally high barriers of entry to building a fashion brand such as AUROBOROS who describes themselves as a “metaverse native luxury fashion house.” Traditional fashion houses and brands such as Balenciaga, Prada, and Burberry are also following suit and producing digital product collections. The first Metaverse Fashion Week was held this past year, which featured both web3 native brands and notable fashion brands like DKNY and Dolce & Gabbana.
NFTs have been buzzing around tech in the last year – they are also catching the attention of fashion houses. LVMH Group is showing signals that they are bullish on web3 and they have launched various products that embody that. Tiffany and Co. released a limited collection of CryptoPunks branded jewellery which can only be purchased by holders of CryptoPunk. TAG Heuer watches that can display NFTs so users can showcase their NFTs on their wrists. Rimowa also launched a collection of NFTs. For brands, web3 technologies can be leveraged as new channels and mediums to connect with their customers.
Sustainability
Fashion contributes to around 10% of the world’s total greenhouse gas emissions and consumes more energy than aviation and shipping combined – making the industry a notorious offender contributing to the climate crisis. Consumers are conscious of the brands that they are supporting and their sustainability initiatives. It’s reported that 57% of consumers have made significant changes to their lifestyles to lessen their environmental impact. The European Commission plans to regulate sustainability in the fashion and textile industry in the region for both producers and consumers as part of the European Green Deal.
There’s an emergence of new business models in fashion designed with sustainability and the circular economy in mind – such as resale, rental, recycle, and repair. Taking resale as an example to illustrate the growth and potential of new business models: the global second-hand apparel market is expected to grow 127% by 2026.
In response to new sustainable business models, brands and retailers are starting to offer new after-sale offerings that encourage sustainable consumption. This is often facilitated by partnerships with startups that have the operational know-how and logistics to power these offerings. The Restory, is a platform that connects customers to on-demand aftercare services like restoration, cleaning, and repair for luxury fashion. They have both a D2C and B2B proposition and have partnered with retailers and brands like Farfetch, Brown Thomas, and Harrods. Selfridges has partnered with startup HURR to offer rental in their London and Manchester locations. Numerous brands and retailers such as GANNI, Harvey Nichols, and Axel Arigato have launched their own resale marketplaces with Reflaunt.
In addition to new sustainable business models, brands are showing interest in using innovative textiles to produce sustainable raw materials to reduce the fashion industry’s footprint. Stella McCartney has partnered with Collaborative Fund to launch a €200M fund to invest in sustainable solutions such as new materials and supply chains.
