Digital Transformation in Fashion Industry - All You Need to Know

Digital Transformation in Fashion Industry  started spreading its roots after the pandemic, sparking creative solutions to emerging problems. Due to globalisation, some Fashion companies had already invested in advanced technologies even  before the pandemic. 

There is a massive shift in consumer behaviour right now, as new generation Millennials and Gen Z are leading the way for tomorrow’s businesses. These generations are truly reshaping the way brands should act and communicate with their audience. If we look at the Fashion retail industry, the online competition is tougher than ever. One can clearly witness the mark left by Digital Transformation in Fashion Industry quite clearly. 

Keeping up with the changing consumer landscape is a major challenge, leading to a shift toward Digital Transformation in the Fashion Industry. According to Statista, the global e-commerce Fashion sector was valued at £668 billion in 2021 and is expected to reach £970 billion by 2027. This blog will discuss Digital Transformation in Fashion Industry and offers insights on how to build your own Fashion statement through digitalisation. .  

Table of Contents

1)  A brief overview on Digital Transformation in Fashion Industry 

2) Need for Digital Transformation in Fashion Industry 

3) Four ways of Digital Transformation in the Fashion Industry  

4) Growth of e-commerce with Digital Transformation 

5) Factors affecting Digital Transformation in  Fashion Industry 

6) Conclusion  

A brief overview on Digital Transformation in Fashion Industry  

Digital Transformation in Fashion Industry refers to how businesses use evolving digital technologies to simplify processes and enhance the Customer Experience (CX). This can include opening an e-commerce store to reach new customers, managing inventory more efficiently, and meeting sales targets. For example, during the pandemic, the "click and collect" option has become popular in the Fashion Industry. 

Brands are now digitalising their entire value chain, from planning to execution, rather than specific areas like sales or marketing.  It's not surprising that brands are now eager to implement digital solutions to meet consumer demands. Every firm must switch to digital technology and adapt to the changing Fashion arena due to the shift in customer demands. The Fashion sector has grown significantly by equipping itself with better digital solutions.  

Using digital solutions can help designers spot trends and modify products to suit customers' wants. It may give the company a competitive advantage over other businesses since both the market environment and client needs have evolved. Since the 2000s, most top online players and businesses have evolved with the help of modern manufacturers and retailers to be part of the competitive marketing environment. 
 

Need for Digital Transformation in the Fashion Industry 

Digital Transformation is essential for the Fashion Industry to stay competitive, so that it can meet increasing and dynamic  consumer expectations and drive sustainable growth. Here are some reasons why the Fashion Industry needs Digital Transformation: 

a) Consumer behaviour: Consumers increasingly use digital channels to discover, research, and buy Fashion products. Digital Transformation can help Fashion brands meet these changing consumer expectations and preferences. 

b) Competition: The Fashion Industry is highly competitive, and brands constantly look for ways to differentiate themselves. Digital Transformation can help brands stay ahead of the competition by enabling them to offer new and innovative products and services. 

c) Efficiency: Digital technologies can help Fashion companies streamline operations, reduce costs, and improve efficiency. For example, automation and data analytics can help companies optimise their supply chain and inventory management. 

d) Sustainability: Digital Transformation can help Fashion companies become more sustainable by reducing waste, improving transparency, and enabling circular business models. 

Four ways of Digital Transformation in the Fashion Industry

The adoption of e-commerce is rapidly increasing with the rising online sales of apparel, accessories, and footwear. Here are a few ways to transform the Fashion world with evolving digital changes: 

Custom avatar virtual trials 

The online clothing market is in full bloom, making it the best time to adopt Digital Transformation in the Fashion sector. One example is 3DLOOK, a virtual AI-based try-on platform founded in 2016. It allows users to create customised avatars by uploading 2D photos, and with their avatar, they can get an idea of their fit and sizing.   

It prevents the risk of customers not purchasing clothes without having an idea of how they might look. It also reduces the need for hiring more salespeople to attend to customers in physical stores. Retailers can use this method to boost customer loyalty towards a particular brand. 

Customised shopping  

Increase the interactivity of your platform by understanding customer preferences with the help of Machine Learning. By implementing new e-commerce business models, you can provide customers with a different experience. Consider Apple Music or Spotify as examples. The user purchases access to resources that make their experience as enjoyable as possible, including what seems like a ready supply of music.  

The experience shifts from being a "warehouse experience" to being more curated, customised, and concierge-style (providing special personal assistance to enhance customer experience). Since the customer has already made a purchase, it is crucial to keep them interested and engaged to be listed in their future buying preferences. 

Augmented Reality 

Augmented Reality (AR) technology combines computer-generated content with real-world environments in real time. By inserting virtual features into a customer's perception of the actual environment, AR delivers an engaging purchasing experience for customers both online and in physical stores.   

Brands can use Augmented Reality to encourage customers to "test before they buy." Warby Parker, an eyeglasses supplier, offers customers a virtual simulation of how different eyeglass frames will appear on their faces. After users take a selfie, buyers may virtually test lipstick tints and other beautiful colours using a Virtual Artist Augmented Reality tool.

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Growth of e-commerce with Digital Transformation

Shopping has undergone a radical shift after the pandemic accelerated the usage of e-commerce. The purchasing patterns of Gen Z and Millennials have significantly impacted the growth of e-commerce. Fashion brands have started investing more in advanced technologies. 

Users have shifted their in-person buying preferences to online purchasing. Retailers need to gear up their marketing game with the evolving ways of Digital Transformation. The growth of e-commerce with Digital Transformation has brought significant changes. Let's look at a few: 

a) Increased customer retention rates 

b) Streamlined business operations with better data insights 

c) Providing services at a reduced cost, leading to a better customer experience 

d) Providing strong analytics for improved actionable insights 

Factors affecting Digital Transformation in  Fashion Industry 

The Fashion Industry is experiencing a digital revolution, and Fashion brands must embrace Digital Transformation to stay competitive. Let’s discuss the key factors affecting Digital Transformation in the Fashion sector: 

Consumer behaviour 

The rise of e-commerce and social media has transformed how consumers shop and interact with Fashion brands. Consumers are increasingly looking for personalised experiences, convenience, and accessibility, and Fashion companies need to adapt to these changing consumer behaviours to stay relevant. 

Technological innovation 

Rapid technological advancements, such as the invention of Artificial Intelligence, Virtual and Augmented Reality, and the Internet of Things, are transforming how Fashion companies design, produce, and market their products. Companies that fail to embrace these technologies may lose their competitive edge in the market. 

Supply chain disruption 

The COVID-19 pandemic has highlighted the complexity of global supply chains, and Fashion companies are looking for ways to make their supply chains more resilient, flexible, and sustainable. Digital Transformation can help companies to streamline their supply chain operations, improve visibility, and reduce waste.   

Big Data Analytics

The use of Big Data Analytics in the Fashion industry helped in improving speed, cost, flexibility and maintaining sustainability across all supply chains. With the help of Analytics, logistics can be automated through a digital warehouse which will improve efficiency significantly. Using Big Data, the industry is also able to predict the sales and demand of certain products in particular cities or countries, which will help them to prepare in advance for any sudden rise in demand or decrease in demand.

Conclusion

Digital Transformation in  Fashion Industry can help the Fashion sector overcome future challenges threatening the industry. Fashion brands should start implementing the process of Digital Transformation, considering it a long-term investment. This can increase the reach of their target audience and lead to sustained progress and quick wins. We hope this blog answers all your questions about the Digital Transformation of the Fashion Industry.

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