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Retail's new digital toolbox

Digital trends in fashion retail can be gimmicky and fleeting, but in 2019 retailers will recognise the practical role new technologies can play. 

Drapers explores the most important digital developments for the coming year, that look to solve underlying industry problems such as overproduction, sustainability and reduced footfall.

Digital sustainability

The past year brought a focus on sustainability to the fashion industry that is only set to increase. With the issue taking centre stage, the range of digital resources at retailers’ fingertips to aid sustainable approaches will grow in the coming 12 months.

“We are now seeing a much greater understanding of the strain that fast fashion puts on the environment,” says Rhiannon McGregor, foresight writer at trend intelligence company The Future Laboratory. “As a result, we’ll see consumers in 2019 become much more attuned to enjoying digital ephemera.”

Digital clothing collections – to be “worn” exclusively in photographs with no real-world presence – could help to curb the environmental impact of fast fashion. They feed into the Instagram influencer culture, which encourages the purchase of items for sharing on social media.

Online fashion retailer Carlings partnered with virtual influencer Perl.www in November to create a 19-piece virtual clothing range. Customers can have an item of clothing digitally fitted to a photo of them, which they can share on social media.

perl.www x Carlings virtual collection

The collection is a digital solution to fashion waste, allowing customers to purchase “single-wear” items without a detrimental impact on the environment.

 At the other end of the supply chain, artificial intelligence (AI) and machine learning will be used to solve issues of overproduction.

digital festival 2019

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Matthew Drinkwater, head of the innovation agency at London College of Fashion, says: “The increased use of machine learning will be a new format of retail where we could potentially see stores reducing the stock that they’re holding but become much more targeted in who their consumer is.”

H&M group is using analytics and AI to control its production levels. The group blamed a build-up of excess stock for a 62% decline in its operating profits to 1.2bn SEK (£108m) for the first quarter, ending 28 February 2018.

Head of advanced analytics and AI at H&M group, Arti Zeighami, explains: “Advanced analytics and AI are some of the most powerful tools we have in the transition towards a circular and sustainable fashion system. With the help of AI, we can align supply and demand much better with the goal of only producing what we are selling. 

This could also entail less transport and warehousing, which means less energy is used. It’s really a win-win situation where we reduce the environmental impact of our operations while creating an even more relevant offering for our customer.”

Virtual prototyping, cloth simulation and sensor measurement tools for pattern cutting will simplify the design and sampling processes, reducing waste and emissions for the industry. 

Using AI to improve fit will also help to reduce painful returns rates for online retailers.

“We will see the development of anything where technology can play a part in helping people select the right size and being able to virtually sample a product and understand how it looks on them or might flow,” says Sundeep Khanna, head of fashion and luxury at Deloitte.

Yoox’s artificial intelligence-powered stylist, YooxMirror, allows customers to virtually style looks from products on its avatar “Daisy” – the selection is updated weekly.

Giuseppe Tamola, Yoox global brand and marketing director, says: “YooxMirror has the advantage of providing insight on how the clothes really look when worn, reversing ecommerce’s paradigm of “first you buy, then you try” and moving back to the bricks-and-mortar [method of trying clothes before purchase].”

Digital personalisation

The vice-president of retail innovation at ecommerce platform Aptos, Nikki Baird, says: “2018 was the year of investing in customer experience for AI. In 2019, we’ll see that move into the production and curation side of things.”

Digital personalisation will provide a virtual solution to the very real problem of overproduction. It will allow retailers to harness customer data and trends to more closely curate collections and improve sell-through rates. Yoox is leading advancements in digital personalisation with its own label, 8 by Yoox – “Otto” in Italian.

8 by yoox

The 8 by Yoox range is created using AI analysed data to predict consumer needs and trends

“Our aim with 8 by Yoox was providing our customers with a collection that perfectly meets their needs – those items that are a representation of what we identify as long-term trends as opposed to seasonal trends,” says Tamola.

The Yoox production team interprets research and analysis from an internally developed AI-driven tool and data from the web, social media and online magazine content to create the range.

“In 2019, more and more brands will use data to generate insight that allows them to move beyond surface-level personalisation,” says Sian Novakovic, experience strategy director at retail experience consultancy Household. “[Luxury etailer] Farfetch, [fashion shopping aggregator] Lyst and [fashion and homeware marketplace] ShopStyle do this well. Service partnerships with multiple brands are able to pick out trends from data, allowing rapid innovation in tune with changing customer demand.”

The trend will develop to generate personalised pricing, says Alex Jones, group director at design and innovation consultancy Fjord. Data from customer payments will be used to generate lower prices for more frequent shoppers determined as having a higher lifetime value. 

He notes that Amazon and Alibaba will be leading the way: “As they both own the payment platforms they’re using and so many components of what they’re calling the new etail infrastructure, they will be the ones that will popularise and set the pace for the industry. It’s inevitable that we will see personalised pricing in store and online.”

Return to the human touch

Digital in store will become less of a gimmick in the coming year. Instead, retailers will use digital to support their shop floor staff, as customers return to bricks and mortar for human interaction and the expert knowledge that this brings with it.

“Digital is not stepping forward as a protagonist in the story, but making everything more seamless,” says Jones.

Chinese ecommerce giant Alibaba Group piloted the “FashionAI” concept store for US brand Guess in Hong Kong this year. The store featured digital innovations such as smart mirrors that offer customers styling suggestions before allowing them to add items to their virtual shopping cart – alerting staff to prepare the garments and accessories for them in the fitting rooms.

Alibaba's fashion AI store

Alibaba’s fashion AI store

“We are creating a seamless interaction between the online and offline worlds by tapping into technologies ranging from machine learning to computer vision [a form of AI that analyses images] to better understand and cater to customers’ fashion needs,” says Alibaba Group’s head of fashion UK and Nordics, Mei Chen.

Retailers will adapt their in-store digital offerings as they rediscover the integral role that staff play in the bricks-and-mortar experience.

Stefanie Dorfer, retail editor at trend forecasting agency Stylus, explains: “Retailers have realised the huge advantage of having real people in store. Digital’s role is to allow customers to switch between online and offline channels without losing any information.”

Blurring boundaries

2019 will bring the bricks-and-mortar store into consumers’ homes – almost literally.

Harvey Nichols has partnered with retail technology company Hero to launch Ask HN – a live online shopping service available on its website on computers and smartphones. From their home, or on the move, customers can have real-time conversations with store staff for styling advice, view specific pieces or request sizing assistance.

harvey nichols x hero press launch

Ask HN allows customers to interact directly with shop floor staff

“Customers who access Ask HN are five times more likely to make a purchase and will on average spend twice as much,” says Pearson Poon, executive director at Harvey Nichols. “By forming a relationship with our sales associates, we believe customers will form a closer connection to our brand and stores, resulting in greater engagement overall.”

Stylus’s Dorfer, meanwhile, says that while mobile is not a new technology, it is a big driver for digital developments in fashion retail.

The most important trends are mobile driven,” she explains. “It’s all about the smartphone for omnichannel retail and using the mobile as a remote control in store.”

Mobile app Sprucebot allows independents to access data from their customers’ devices. The bot integrates into stores’ wi-fi and sends information straight to staff members. Among its capabilities, it sends an alert when shoppers who have downloaded the app enter the store, so they can be greeted by name, and keeps records of customers’ preferences and tastes.

However, retailers need to be careful to offer a proportionate level of customer service to the amount of data that they are extracting.

Jones warns: “In 2019, people will no longer accept mediocre rewards in exchange for their data. They will expect more from services, so organisations will be forced to do more to ensure customers can clearly see what’s in it for them.”

 

 

In-brief tech insights

AI marketing: The opportunity to cut costs while increasing efficiency has led companies such as etailer Zalando to replace human staff with AI for a more targeted approach

Voice search: As more retailers make use of the new technology, 2019 will bring exciting developments to stay competitive as Microsoft has reduced the error rate of its voice recognition to that of a human

In-store 3D printing: The service will combine personalisation and convenience to produce products while customers wait. Adidas trialled its “Knit for you” pop up this year, focused on high quality and sustainable creations, but 3D printing could take the trend mainstream

Workflow mapping: As online sales grow retailers must iron out issues to support customer journeys across all channels – an area where new tech developments could prove useful

Click and collect: A simple solution to increasing footfall that continues to be a hot topic in the industry

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