You might already know that the fashion industry has been heavily criticized lately for their unsustainable practices. But you probably do not know the size of the problem: the fashion industry is responsible for a staggering 10% of global carbon emissions each year. To put this into perspective, that's more than what is produced by both international flights and maritime shipping combined.

The impact of the fashion industry on the environment and society at large is truly alarming. Not only does it contribute significantly to greenhouse gas emissions, but it also exploits entire communities throughout its supply chain. Thankfully, there has been a notable increase in awareness over the last years, particularly driven by younger generations, who are advocating for sustainable fashion. Customers of all ages are now expecting fashion brands to uphold ethical values.

It is now time for fashion companies to rethink their practices and approach to production in order to address the pressing concerns and create value for their own customers. As they strive to become more responsible, digital technologies can be a valuable support and play a crucial role in their journey. These innovative solutions enable enhanced transparency, end-to-end product tracking, and emission reduction. While the fashion industry has been slow to adopt new technologies in the past, the urgency of the situation demands immediate action.

This article will explore the exciting world of digital solutions and show how they can empower the fashion industry to become more sustainable while also keeping customers engaged.

Fashion industry needs to transform quickly

The fashion industry is in dire need of focusing on sustainability, and here are the key reasons why:

1. They are negatively impacting the society and governments are taking actions.

The fashion industry has earned a reputation as one of the most polluting industries worldwide. Let's take a closer look at some eye-opening statistics:

The fashion industry produces between 80 and 100 billion new clothing items annually.

Each year, 92 million tons of textile waste is generated globally. The leading contributors to this waste are China (20 million tons) and the US (17 million tons).

Clothing and textiles make up a substantial 7% of the total waste found in landfills worldwide. 87% of the materials used in clothing production are either burned in incinerators or dumped in landfills.

The recycling efforts for textiles are disheartening, with only 20% of discarded textiles being collected, and a mere 1% of clothing being recycled into new garments.

These figures emphasize the urgent need for effective solutions to reduce textile waste and foster a more sustainable fashion industry.

Fashion brands are not only responsible for environmental pollution but also for human rights violations. The exploitation of workers in the raw material sector, unsafe working conditions, salaries below the minimum wage, discrimination, and abuse in the production sector are just some examples of how the fashion industry has been promoting so-called modern slavery. The scale of this negative impact on people and the environment has increased as companies are always producing more. Customers now buy 400% more than they did 20 years ago, and 73 million tonnes of textiles are consumed every year. 

Because of the dramatic impact fashion brands have, governments are introducing strict regulations on both social and environmental sustainability. Fashion brands have to adhere to the new standards if they want to remain competitive. One of the most influential regulations being implemented is the Digital Product Passport, which requires all products to have a unique identification. This requirement will have a significant impact on the industry as a whole. The net-zero transition asks fashion brands to increase transparency and traceability throughout the entire supply chain and find new ways of reducing emissions.

2. The new generation of customers is sensitive to sustainability.

The new generations of customers are extremely informed about the impact of the fashion industry on the climate crisis and are changing their behavior in favor of more sustainable options. But it is not just that. 

Millennials and Gen Z have shown they are seeking a different concept of fashion. Customers from Generation Z are looking for one-of-a-kind, limited-edition, and ethically produced clothing, while Millennials value the experience around the product and local manufacturing. What emerges from young customers the most is the need of manifesting their individual identity through what they are wearing. “Led by Gen Z and millennials, consumers across generations are not only eager for more personalized products but also willing to pay a premium for products that highlight their individuality” (McKinsey & Company, 2018).

Furthermore, consumers are increasingly expecting brands to take a position on either social, environmental, or political issues. They base their decisions always more on ethics and authenticity. Customers want brands to be vocal about their values and will more likely buy from those that are aligned with their ideals. Hence companies should be consistent in operating based on their values and create a unique customer experience around it that can be as customizable as possible for the end consumer.

The fashion industry has been one of the slowest industries to adopt new technologies, both in the upstream activities and in their interaction with customers. Therefore, the whole business is now undergoing a “large scale change as a direct result of the rise of technology and its impact on consumer behavior” (Deloitte, 2018) to remain competitive and appealing to end-consumers.

Customers are spending an increasing amount of time online: Gen-Z spent an average of eight hours per day on screens and an average of 7.3 hours per week playing video games in 2020. Fashion companies need to become more digital if they want to survive in this highly competitive and ever changing industry.

The three biggest opportunities for clothing brands in 2023

The three main opportunities in the fashion industries at present are:

• Digital technologies

• Responsibility

• Customer experience

The first opportunity lies in the realm of digital technologies. This includes leveraging technological advancements such as artificial intelligence, data analytics, and transactional platforms to improve effectiveness and efficiency of various aspects of the fashion industry, from supply chain management to personalized customer experiences.

The second opportunity is centered around responsibility. With increasing awareness and demands for sustainability, clothing brands have the chance to prioritize ethical and environmentally-friendly practices. This involves reducing emissions from both upstream operations and the brand own’s operations and also encouraging sustainable consumer behavior. 

The third opportunity lies in enhancing the overall customer experience. By focusing on creating unique and engaging interactions, clothing brands can establish stronger connections with their target audience. This can be achieved through personalized marketing campaigns, immersive shopping experiences, and excellent customer service.

It is worth noting that by leveraging digital technologies, brands can quickly address the other two opportunities. These technologies enable brands to promote responsible behavior, reduce waste, and improve customer engagement, leading to long-lasting and meaningful relationships with their customers. By capitalizing on these opportunities, fashion brands can stay ahead of the curve and thrive in the ever-evolving industry.

How can digital transformation support sustainability in the fashion industry?

The fashion industry is undergoing a profound paradigm shift. Over the past 20 years, fashion brands have prioritized reducing production costs, increasing volume, and leveraging social media and advertising to drive sales. This approach has led to a constant push for higher production year after year. However, there is now a growing awareness among the public and governments about the unsustainability of the fast fashion model as the detrimental consequences are rising to the surface.

As a result, fashion brands are being asked to stop producing too much and adopt a new way of doing things. They are being called upon to fundamentally transform their practices and abandon the fast fashion machine. The emphasis should now be on sustainability, responsible production, and adopting methods that have minimal negative effects on the environment and society. This necessitates reevaluating their business models, supply chains, and consumer behaviors to foster a more sustainable and ethical fashion industry.

Digital technologies play a key role in transitioning to a sustainable business model because through that digital layer built on top of the product companies can create a superior customer experience, reach a next level of customer engagement and leverage that to create new revenue streams. By creating a digital ecosystem around the product they can decrease the production while compensating the loss in revenue. 

Fashion brands should prioritize investing resources in creating immersive experiences around their products. By focusing on fostering customer relationships and building a strong sense of community, they can capitalize on these connections to offset potential revenue loss. By monetizing the experiences and interactions with customers, fashion brands can find alternative revenue streams that help compensate for any decrease in traditional product sales. 

This approach emphasizes the importance of nurturing customer loyalty, engagement, and a sense of belonging, which can ultimately contribute to long-term business success.

Software applications, networking technologies, cloud computing, mobile technologies, Internet of Things (IoT), Artificial Intelligence, Big Data and Blockchain are all digital technologies that can be leveraged to create a digital layer around their products, enabling enhanced customer experiences, fostering engagement, and leveraging new revenue streams. This digital ecosystem facilitates the shift towards sustainability.

8 Digital technologies and how they help in the fashion industry

Here’s how each of these technologies can help in the digital transformation of the fashion industry: 

Software applications: Software applications enable the development of user-friendly platforms and mobile apps that connect customers to the digital ecosystem. These applications provide features such as personalized recommendations, digital wardrobes, and real-time insights on sustainability aspects, enhancing the customer experience.

Networking Technologies: Networking technologies facilitate seamless communication and data exchange within the digital ecosystem. They enable real-time interactions between fashion brands, customers, and other stakeholders, fostering collaboration and community building.

Cloud Computing: Cloud computing provides scalable and flexible infrastructure to store and process vast amounts of data generated by the digital ecosystem. It enables efficient management of customer information, inventory, and analytics, supporting personalized experiences and informed decision-making.

Mobile Technologies: Mobile technologies, such as smartphones and tablets, enable convenient access to the digital ecosystem. Customers can easily engage with fashion brands, scan QR codes, access applications, and receive personalized recommendations on sustainable practices.

Internet of Things (IoT): IoT devices, embedded in clothing or accessories, can collect and transmit data related to garment usage, environmental impact, and consumer behavior. This data contributes to insights on sustainability and helps in tailoring experiences and recommendations to individual customers.

Artificial Intelligence (AI): AI technologies power personalized recommendations, predictive analytics, and virtual try-on experiences. AI algorithms can analyze customer preferences, historical data, and trends to provide tailored suggestions and improve the overall customer experience.

Big Data: The vast amount of data generated by the digital ecosystem can be analyzed using big data techniques. Insights derived from analyzing customer behavior, supply chain data, and sustainability metrics can inform decision-making, support targeted marketing strategies, and identify areas for improvement.

Blockchain: Blockchain technology offers transparency, traceability, and trust in supply chain operations. It enables secure tracking of product origin, materials sourcing, and sustainability certifications, fostering accountability and promoting ethical practices.

How can fashion brands practically develop these digital solutions?

The fashion industry has faced challenges in embracing the digital transition. The industry is deeply rooted in tradition and cultural heritage, which has made it resistant to rapid technological changes. Since the primary focus of the industry is on designing and producing clothing, there is clearly a lack of expertise and capabilities in developing internal digital solutions. There are no synergies between a company producing clothes and technology development, resulting in a slower adoption of digital advancements. These factors have contributed to the slower pace of digital transformation in the fashion industry.

To transition rapidly to digital, fashion companies can make a strategic decision to partner with tech companies who specialize in developing new technologies that are tailored for the fashion industry. These tech partners can provide the necessary expertise, resources, and support to drive digital transformation in an industry that has traditionally been less focused on technological advancements.

By collaborating with a tech partner, the fashion brand can expedite the development and implementation of digital solutions, benefiting from the partner's expertise and reducing the learning curve associated with in-house development. This strategic decision enables the fashion brand to embrace digital transformation faster and more effectively, keeping pace with the evolving consumer expectations and industry trends.

How big brands are using digital solutions for customer experience and sustainability

Big brands have been always allocating more resources to digital experiences because they understand that this is the way to go if they want to remain competitive in the market. Here are some examples:

Adidas

Adidas introduced the Adidas Confirmed app, which allows users to reserve limited-edition releases and participate in exclusive events. They also developed the Adidas Runtastic app, a fitness platform that integrates with their sportswear products to track and analyze users' workout data.

Patagonia

Patagonia is known for its commitment to sustainability. They have a program called Worn Wear, which encourages customers to repair and reuse their clothing rather than buying new. They provide repair guides and offer a trade-in program where customers can exchange their used Patagonia items for credit.

Levi's

Levi's partnered with the technology company Evrnu to create jeans made from post-consumer cotton waste. They also developed a chatbot called Virtual Stylist that provides personalized style recommendations and helps customers find the perfect fit.

Burberry

Burberry has integrated digital technologies into their retail stores to enhance the shopping experience. They use RFID (Radio-Frequency Identification) tags on their products, allowing customers to interact with items by scanning them to access additional product information and digital content.

Layerise provides companies with innovative digital solutions 

Layerise empowers fashion brands to create a digital ecosystem by providing them with the tools and capabilities to enhance customer experiences, gather valuable data, and drive revenue growth. Here's how Layerise specifically helps fashion brands in creating the digital ecosystem:

Layerise enables fashion brands to deliver personalized and immersive customer experiences. By utilizing the platform, brands can create interactive product experiences. These engaging experiences not only increase customer satisfaction but also foster a deeper connection between customers and the brand.

Moreover, Layerise facilitates data collection during customer interactions, allowing fashion brands to gather valuable insights into customer behaviors, preferences, and interests. This data-driven approach helps brands understand their target audience better and make informed decisions for product development, marketing strategies, and inventory management.

With the customer insights gathered through Layerise, fashion brands can personalize marketing campaigns and offers. By understanding individual preferences and purchase history, brands can deliver tailored recommendations and promotions that resonate with customers, increasing conversion rates and driving sales.

Layerise helps fashion brands identify new revenue streams and monetize customer experiences. By leveraging the digital layer on top of their products, brands can introduce additional services, such as virtual styling consultations, subscription models, or personalized content subscriptions. These value-added offerings create opportunities for increased revenue and customer loyalty.

Layerise keeps fashion brands at the forefront of technological advancements and industry trends. The platform evolves with the changing needs of the fashion industry, providing updates, new features, and integrations to help brands stay competitive and deliver cutting-edge digital experiences.