​
Connected Fashion Retail
I have recently seen a man in a fashion store that came to the shop assistant and showed her a picture on his smartphone. She said: “We don’t have it.” Then: “This has been sold out already.” We can assume what was the question but this reflects the huge disconnect between online and offline retail.
Connected fashion retail is a concept that refers to the integration of online and offline customer journeys in the fashion industry. It aims to provide a seamless and consistent shopping experience for customers across different channels, platforms and devices. Connected fashion retail also leverages data and technology to create personalized and engaging solutions for customers based on their individual needs, preferences and behaviour.
Why is Connected Fashion Retail Important?
**Customer expectations.** Customers expect a smooth and convenient shopping experience that matches their lifestyle and preferences. They want to be able to research, compare and purchase products across different channels, as well as receive personalized offers and recommendations. According to a survey by McKinsey, 60% of European customers wanted to see or touch products in-person before buying, while 50% shopped in stores so they can take items home immediately. At the same time, more than 60% of shopping journeys now have a digital component for either research or transaction.
**Competitive advantage.** Connected fashion retail can help fashion retailers differentiate themselves from their competitors and increase their customer loyalty and retention. According to a report by BoF and McKinsey, engagement with in-store technology can lead customers to spend up to four times longer shopping than those who do not. Moreover, connected fashion retail can help retailers optimize their inventory management, supply chain efficiency and sustainability performance by using data and technology to forecast demand, reduce waste and improve traceability.
Pain Points of Customers and Retailers
Despite the importance of connected fashion retail, there are many pain points that affect both customers and retailers in the fashion industry. Some of the main pain points are:
**Disconnected customer journeys.** Currently, online and offline customer journeys are often disconnected and inconsistent, leading to frustration and dissatisfaction for customers. For example, customers may not be able to find the same products or prices online and offline, or they may face difficulties in returning or exchanging products across different channels. Additionally, customers may not receive relevant or timely information or assistance from retailers when they shop online or offline.
**Inefficiencies in production and distribution.** The lack of connection between online and offline customer journeys also creates inefficiencies in production and distribution for retailers. For example, retailers may overproduce or underproduce certain products based on inaccurate demand forecasts, leading to stockouts or excess inventory. Alternatively, retailers may incur high costs and complexity in shipping and handling products from warehouses to stores or customers' homes, especially when dealing with online returns.
**Environmental and social impact.** The inefficiencies in production and distribution also have negative environmental and social consequences for the fashion industry. For example, overproduction and excess inventory contribute to textile waste and greenhouse gas emissions, while online returns increase the carbon footprint of transportation and packaging. Furthermore, the lack of transparency and traceability in the fashion supply chain makes it difficult for customers and retailers to assess the environmental and social impact of their fashion consumption or production.
AI Technology as a Potential Solution
AI technology is a potential solution that can help fashion retailers create a connected fashion retail experience for their customers. AI technology refers to the use of artificial intelligence (AI) to collect, analyze and use data to provide customized solutions for customers based on their individual needs, preferences and behaviour. Some examples of AI technology that can enable connected fashion retail are:
**Personalized recommendations.** These are tools that use AI to suggest products that match the customer's style, taste, size or occasion across different channels. They can help customers narrow down their choices and make better decisions, as well as increase cross-selling and up-selling opportunities for retailers.
​
**Sustainability scores.** These are tools that use AI to measure and display the environmental and social impact of fashion products based on various criteria, such as materials, production methods or carbon emissions across different channels. They can help customers make more informed and responsible choices by comparing different products or brands.
What’s next?
Now imagine that you have an AI-driven tool - a simple app that acts as your personal digital stylist disregarding where are you in your customer journey: in-store or at home. It helps you find and buy a fitting look in-store or online, assists with daily styling and even lets you sell the clothes you don’t need with one click. It would mark a new era of blended retail and create enormous opportunities for circular fashion impact. Just one look resold at a second-hand platform is reducing around 60 kg of CO2 emissions.
Sources
(1) The Technologies Reinventing Physical Retail | BoF. https://www.businessoffashion.com/articles/technology/state-of-fashion-technology-report-connected-retail-stores/.
(2) State of Fashion Technology Report 2022 | McKinsey. https://www.mckinsey.com/industries/retail/our-insights/state-of-fashion-technology-report-2022.
(3) Connected Retail - The future of retail - FashionUnited. https://fashionunited.uk/news/retail/connected-retail-the-future-of-retail/2020110951827.