IMPRESSIONS from a Cross-section

Topic

As someone who has been keeping a keen eye on the interplay between fashion and technology, (a) how do you see the fashion industry transforming in the immediate future? (b) After all, the fashion industry has been rather slow in taking up to tech.

Tech in fashion industry has hit acceleration button
The estimated $3 trillion fashion industry has typically been slow in adapting newer technology in the past. But the current pandemic has had industry hit the acceleration button. Fibre2Fashion spoke to few techexperts to know their views.

 

There are significant opportunities for businesses to drive competitive advantage through increased digitisation across the supply chain, particularly through 3D design and development. It has the capacity to shorten lead times and help get products to market, even when people are forced to work virtually. These shorter routes to market will allow for less stock risk, and will mean that businesses will work in a more responsive way to market fluctuations.

I totally agree, but now it’s going to change. I think the circumstances will make everyone move faster and look for new opportunities. I think e-commerce will be on top of the list and the fashion industry will be forced to adopt new tech solutions.

The fashion industry is at the cusp of dramatic change. Technology is at the centre of this change, which is being driven by increasing consumer demand for deeper, more digital experiences and dramatic shifts in the speed of supply chains. Today, we are seeing that change in how brands and retailers engage consumers, how supply chains operate, and how shoppers interact with apparel. Consumers are shopping differently and increasingly moving online. When they do shop in stores, they are looking for more of an experience.

Digital technology gives brands and retailers additional “touch points” with their consumers. Some examples include online retail software that suggests additional items based on a customer’s prior purchase history, RFID technology driving omnichannel supply models, and digital trigger technologies, like QR codes, that allow consumers to interact with their apparel. 

Finally, the apparel industry is deploying technology in response to trends like customisation, personalisation, supply chain transparency, and circularity. Digital body scanning and manufacturing technologies are being used to create unique, personalised garments. Distributed ledger technologies like blockchain, are being deployed to drive transparency in the supply chain. And intelligent labeling technology is being tested to help connect the supply chain to enable garment recycling or circularity. It’s an exciting time in the apparel industry. Technological change is upon us, and is only accelerating.

Tech in the fashion industry has hit the acceleration button. Automation through leveraging artificial intelligence (AI) and machine learning (ML) has become imperative for retailers to maintain efficiency, especially among current challenges such as staffing reductions, as well as increasing pressures to drive personalisation through consumer experience, assortment curation, and
stocked products.

Because of increased technology adoption, retailers have become data-rich environments. They are looking to harness the power of that data to drive to more prescriptive demand forecasts. Retailers are also evaluating their end-to-end supply chain networks to drive more exception-based real time views, which will help navigate customer expectations and establish clearer visibility into product flows. And, as ecommerce continues to grow in popularity, retailers are exploring solutions like micro fulfillment to help fulfill online customer orders in efficient, cost-effective ways.

We have seen a massive acceleration towards technology adoption in the apparel industry for two main reasons. First, apparel companies are seeing traffic to their websites hit an all-time high, with many new customers coming to their site, being able to personalise the experience and provide good solutions around fit and sizing are more important than ever before. Second, as apparel brands and retailers around the world are evaluating how to reopen their stores, they’ve all had a major realisation—allowing customers to try on clothing might not be an option.

The apparel industry is trying to very quickly determine how to integrate technology into their stores to continue to provide a great customer experience despite the fact that fitting rooms aren’t likely going to be an option customers are comfortable with.

The fashion industry has been talking about adopting technology for many years and now it’s clear they have no choice but to digitally transform to survive. Until now, the focus has been an in-store first approach. Retailers and brands need to start thinking about their strategic mid- and long-term responses to covid-19. They must be agile, pivot business models and work rapidly
to develop flexible models to get them through the next 18 months of oscillating supply and demand. By transforming to omnichannel, fashion retailers will have access to what will become the most important channel of communication and sales-ecommerce. The recognition of the power of data and a smart usage of it is becoming of essence.

(a): Retail is an entirely different conversation but with respect to fashion: how the creative side of the business functions going forward will change dramatically. The use of new technologies, especially 3D solutions, will assist designers, merchandisers and product developers to bring collections to the market in a much faster way. Timelines will shrink, there will be less physical samples that get thrown into landfills, and better, more collaborative decisions will be made with 3D concerning silhouettes, colours, patterns, accessories and other details. Changes can be made on the spot and all of this will be shared with factories in real time. The same holds true for the textiles involved as well as how things will appear within the retail environment. These are not hopeful plans or ideas for the future, but this is taking place today. (b): This is an understatement. One of the reasons the industry is in such a difficult position is because the digital transformation and process improvements needed have not been implemented.

The virtual sizing industry has made incredible progress over the last 10 years. On the consumer side, our greatest challenge is getting shoppers to adopt the technology and use it on apparel ecommerce sites. Amongst consumers there is still a bit of distrust around sizing solutions, but we’ve seen this changing in a positive direction over the last few years. As the technology is normalised and people come to expect it, there is less hesitation to seek size advice as opposed to referring to an outdated size chart.

Though companies have been slow to adapt to the new technology, this is changing - and it has to do with the increase of people shopping online. Companies see that they must prioritise and invest in their e-commerce channels. Adapting to an online world is no longer an option, it’s a necessity.

Companies understand now more than ever that they need to make online a priority. This shift has been accelerated by the current pandemic. Before covid-19, the forecast industry consensus put a 5–10-year timeline on the evolution from brick-and-mortar to online. The rapid shift of economy and subsequent consumer behaviour has reduced 10 years to just a matter of months.

I agree the fashion industry has been quite slow in adopting new technologies, and this is due to the peculiarity of the industry where the production quite often is not managed internally by the final brands. Being so, they are not incentivised to invest that much in technology. However, I believe this crisis has accelerated the openness of fashion corporates toward digital technology, as in same cases using digital was the only possibility to continue the activities. I’m referring for instance to the use of digital showrooms, or new ways of selling to the end customers such as using live sales streaming.

The relationship between fashion and technology has been evolving, taking different forms, and has been disrupting business models and value chains. Such relationship will take different forms especially that recently we have seen various synergies arising from combinations of different technologies, such as analytics, machine learning and data visualisation. Digital transformation is key; yet it is often misunderstood and approached either at the wrong time or a high degree of over-confidence around embedding it in business strategies. Fashion brands shouldn’t consider that digital transformation is just a process, and similarly shouldn’t give priority to the availability of resources only. It is about creating a new culture around technology acceptance, driven by a mindset that capitalises on the strong relationship between the company and its stakeholders. It is important for brands to think about this process organically and align digital strategies to their business models and their drivers of value.

Yes, it is true the uptake of technology in this area hasn’t moved as fast as one could have expected but we believe we are seeing a substantial shift in the current context, where the online experience has come under such sharp focus and the offline shopping journey and services will have to be adapted. To optimise the online experience, we believe we will see the fashion industry put a much larger investment in emerging technologies and customer engagement tools, such as VR, AR, AI personal stylists, customised delivery preferences, alternative payment methods and more, to deliver a more personalised end to end service. The future of the in-store checkout will be one that is free of cash, lines, paper receipts and stationery checkout hardware, and will need to be seamlessly integrated with online when it comes to the purchase, the transaction, as well as the last mile delivery and post purchase experience. We are already seeing these come into play as retailers reopen stores and prioritise cleanliness, new try-on/return processes, and touch less payments to minimise contact at checkout. Even in-store events, which have become very popular, may be challenged to go online. Retailers will have to bridge the gap between the digital and physical to provide a seamless customer experience across all channels and touch points.

While it is true that the estimated $3 trillion fashion industry has typically been slow in adapting newer technology, it's equally true that many big brands have made significant strides in using technology, especially to streamline their retail front stores and supply chains. The impact of the current pandemic has only accelerated the thrust on technology adoption, especially for consumer-facing retail companies. This trend is here to stay, regardless of the pandemic.

There is significant anxiety regarding the timing and extent of While it is true that the estimated $3 trillion fashion industry has typically been slow in adapting newer technology, it's equally true that many big brands have made significant strides in using technology, especially to streamline their retail front stores and supply chains. The impact of the current pandemic has only accelerated the thrust on technology adoption, especially for consumer-facing retail companies. This trend is here to stay, regardless of the pandemic. The fashion industry’s recovery from covid-19. In late February, the biggest concern was supply of product from China. Today, the biggest concern is demand for product in North America and Europe. There have already been a few retail bankruptcies with more to come. Also, I expect that many Asian production facilities will go out of business. Many of my customers are interested in our ‘Covid Recovery Capsule’ solution which deploys available inventory—currently in stores, in DCs, in transit and at the factory—to the channels and regions with highest demand. It also analyses causal data such as increasing infection rates by locale and makes sure that inventory does not sit idle during periods of store closures and low traffic.

We had already been observing an increase in the fashion industry’s adoption of new technology in the nine months prior to the pandemic. This trend significantly accelerated during the covid-19 crisis, as e-commerce moved to the forefront. At the same time, retailers have been exploring how to use technology to manage the in-store experience going forward.

Over the past couple of months, the famously fast-moving fashion industry has been forced to slow down, or in some cases, come to a screeching halt. But while ‘normal’ ways of working have been turned on their head, there is a short window of opportunity for experimentation and change.

The impact of covid-19 highlights, with renewed importance, the need for digitalisation within the fashion industry. Brands will have to cut costs; they can’t push down unit prices of products any further. That means they’ll have to source smarter and find efficiencies across the value chain and product lifecycle. Many businesses may not be able to scale up their teams to pre-covid-19 size, so will need to upskill staff and use technology to drive efficiency and enable them to make more informed choices.

They will also need to gather more supply chain data to better anticipate, manage and mitigate risk should a situation like this pandemic happen again. The only way to successfully achieve this is to digitise often informal supply networks ensuring data is gathered beyond tier-1 factories. Brands which rely too heavily on certain regions or factories will need to diversify their supply chain, or look for new supply chains to launch new product lines.

The fashion industry has always been slow in tech due to 
The large industry chain that doesn’t allow stakeholders to make changes themselves;
The fast-moving pace so no one has the time to slow down and make innovations;
Everything works perfectly fine within the traditional process.

However, the covid-19 pandemic has changed the situation. The fashion industry has been forced to cancel all traditional offline events. The term “digital fashion” finally has the chance to come to the surface of the water. Before the pandemic, we estimated that it will take 2–3 years more for the fashion industry to migrate into digital fashion, but comparing the inquiries coming in Q1 2020, we are on track of receiving 3X more inquiries by the end of Q2. People in the fashion industry are definitely looking for digital solutions and will be willing to fully adopt fashion technologies in the future. All they need is a push and covid-19 made it happen. Although more and more countries are opening up, we think global travel bans will still be restricted for a while. How to utilise digital technologies to scale businesses and maintain effective communication and other business activities would be a big challenge for the fashion business during the current situation.

Published on: 24/06/2020

DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.

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