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Fashion Goes Tech: Digitalization in retail (1)
When I published Fashion Goes Tech, retail was suffering the worst crisis ever: covid-19. Empty streets, no traffic, stores closed. In other words, no footfall, no conversion, no inventory turnover, frozen cash flows, no business. In a business like fashion, it also means that you are increasing inventories and reducing the probabilities of selling it at full price (some categories, like formalwear was almost killed. Who is wearing a suit and tie compared to a few years ago?). Seasonality means “deadline”: if you don’t sell it during the next 6 months, the collection will be out of date, even if you can sell it in outlet stores, discount stores, by weight or bulk. But while stores remained closed, digital adoption and transformation was speeding up. Companies like Amazon, Farfetch or Zalando were skyrocketing.
It’s crazy how retail and the way we shop has changed since I finished my BA in Sociology, 16 years ago. From a professional journey perspective, I’ve had the opportunity to work for large apparel multinational companies when loyalty cards were implemented or CRM/loyalty initiatives were managed through spreadshets. Fashion companies used their sites (in case of having any) to display some pictures and standard information (no videos, no “likes”, no ecom) and Mango, for example, opened more than a store each day worldwide. Then, I became an entrepreneur at Normandie, a baby clothing brand that reached the milestone of opening shop-in-shops at El Corte Inglés and Harrods (London). I remember that Zara just opened it’s online shop and other brands from Inditex were about to open in 2011-2012. Only a few companies were talking about digital, omnichannel, sustainability or inclusivity.
Then, I joined a leading business strategy and operations consulting firm where I worked for retail companies globally (South Africa, Turkey, Russia). There, I had the first experience on how technology could improve operations (e.g. inventory management, demand forecasting, category management, pricing, just to mention a few). 5 years later, seeing that retail was going tech, I decided to join a leading Technology company. It was a great experience to realize how digital was evolving and retailers were accelerating their adaptation. New solutions across all business areas to support visibility, transparency, control…
I finally came back to the fashion retail industry working as group transformation director for one of the largest apparel companies in Spain. During my last experience as transformation director, I was part of what I described in my book: a digital transformation by accelerating initiatives across all areas of the business (Human Resources, Design, Finance, Operations, eCom, Retail, Digital, etc) with the support of a digital consulting firm. A great experience to see, in detail and in real life, what is explained in Fashion Goes Tech: Omnichannel, Sustainability, Loyalty or Data Strategy. As a result, an exciting and inspiring 360º professional journey across the world of retail. A journey that, of course, continues.
Fashion Goes Tech – Creativity vs Science?
With the aim of sharing my experience and using Fashion Goes Tech as a key pillar, next blog posts will describe, area by area (e.g. Design, Planning, Operations…) what are the best practices and best digital solutions in the market to support sustainable growth. The Fashion Retailer blog never accepted payments or sponsored articles, and this is not going to change. If I mention a company, it’s because there is a business experience or solution worth to mention. The objective is giving some insights from the book and update the information with inputs from subject-matter experts.
As I introduced in my recent publishing, the binary system of fashion, creativity and science, mutates today in what is called Fash Tech or Fashion Technology.
Is Fashion becoming more science than creativity? I usually ask this question on my interviews (“A day in the life with…”). Is creativity losing its importance as science is gaining ground in the fashion industry?
These are some of the answers given by retail experts, founders and executives:
- Ivan Abad, former retail director at Mango, founder of Wemuse and CEO of FutbolEmotion: “Fashion has a part of creativity, emotion, trends, a sense of belonging…, brands that succeed do it beyond technology. I think that the creativity, the ability to understand the customer and anticipate trends still depend on people, so as in the stores, I see technology helping them to develop their potential in the different areas of the creation, not replacing them.
- Erin Cavanaugh and Yi Zhou, former executives at Nike and Nordstrom; founders at See Rose Go (a plus size fashion brand committed to creating thoughtfully designed clothing with quality and innovation): “For some brands, it definitely is. With larger markets, bigger brands are driven to use science to make an informed, safe decision. The downside is there is little room to be proactive or take initiative when recognizing a new opportunity”.
- JoaquÃn Villalba, former executive at Zara – Inditex and Nextail co-founder and CEO (Nextail is a smart platform for retail merchandising): “There needs to be a balance. At Nextail, we are passionate about how data and technology can transform the fashion retail industry. This doesn’t mean that there is no space for art in fashion. Some roles, such as buying, will always require a degree of intuition, and product design is a creative art -neither can be replaced by science alone. In these spaces, leveraging technology can empower individuals, from making more informed decisions based on historical data to freeing up time with automation. Using technology in that way means creative experts get to focus on innovation and in turn deliver a more engaging product offering for shoppers”.
- William Bernal, CEO and founder at VIPO Group (A company that provides automatic customer profiling based on cutting edge technology): “For me, fashion will always be an art because systems can learn and generate new alternatives to dazzle our clients, but we are still exploring how to duplicate the creative nature of the human being. I think that today’s fashion companies are finding an ally in technology that allows them to create smart clothes, moving shapes, and even help customers design their own clothes”.
- Shivang Desai and Chandralika Hazarika, founders of Bigthinx (an AI company operating in the fashion and retail industry, offering 3D mobile body scanning, clothing size predictions, virtual avatars, digital clothing, and virtual fashion shows and photo-shoots.): “There is a huge scope for improvement in the way fashion companies operate, such as using body data to improve clothing specifications to fit their shoppers better, identifying how many pieces of each size to manufacture to prevent wastage and unsold merchandise, digitally sample clothing designs pre-production, and even trial designs using virtual avatars of real customers to get a better idea of which products will sell better. While the creativity of fashion design still remains art in essence, its delivery can definitely become more scientific and benefit from technology”.
I included some of the above comments in the book but I also recommend to read the answers from Rene Fang, from iStaging, an early-mover in the VR technology industry and virtual tours; Morten Mogelmose, from Zliide, a platform that enables customers to get the most convenient experience in fashion retail, ensuring the best experience in-store and online; or Johannes Lageras from WorkShop, a full service (retail) experience company., amongst other interesting interviews published on the blog.
Digital transformation acceleration is happening and data is going to support creativity. The road to digitalization won’t be easy, nor safe. Like the story of the Odissey and Ulysses, companies will need to face many challenges, requiring changes that will shake up businesses. Transformation itself is a challenge because people are reluctant to change and the retail business didn’t change in the last 50 years. If we pay attention in IT departments, we usually find people that spent 30 years of their career implementing and updating systems that are Dinosaurs, complex to adapt to agile and flexible times. On the other hand, we find executives with little understanding of the rules of omnichannel businesses or how to attract and retain talent. Do you know any Fashion Retail company CEO that understands technology (or supply chain)?
There is a lack of talent or digital skilled individuals to respond to new challenges and executives must decide what to invest in. Is it worth investing in owned factories, automated warehouses, RFID, 3D Design, PLM systems, dark stores, etc? It depends on your value proposition, your business model, your key activities, resources, partners… Outsourcing and focusing in the right activity is key in this period as I described in Technology Platforms (e.g. Farfetch). But, an essential, if not the most important asset is and will always be: people.
Next blog post will be about the designing phase. Don’t miss it!
Read more about Fashion Goes Tech:
Fashion Goes Tech: Creativity vs Science
Fashion Goes Tech: Merchandising
Digitization in Fashion: Designing