I ended the previous post with this query:
Will personalization (and the necessary automation-robotization to achieve it) mean that fashion production will be relocated to developed countries?
Absolutely! I have no doubt about that!
The neorelocalization of fashion production does not imply a return to the past, to the industrial situation that we and our grandparents have known. Through customization, which requires the robotization and automation of factories, manufacturing will return (totally or partially) to the vicinity of stores and shopping centers where clothes, footwear and fashion accessories are sold. We consider as total and local production the 100% robotized manufacturing of a t-shirt in proximity or within the country where it is sold in stores. The partial elaboration or customization would mean importing a basic jean from Asia and, at the request of the consumer, in the on-line channel or in the physical store, applying a personalized laser finish near the shopping center and sending it to the customer on the same day or the next day wherever they tell us.
E-commerce is leader in personalized fashion.
n the report The State of Fashion 2018, Kati Chitrakorn begins by expressing the current reality and then leaves us with a very interesting question: “powered by the use of artificial intelligence and the analysis of large volumes of data, the market’s leading global online platforms can make an impersonal environment become highly personalized.
With personalized products, individualized recommendations and more intelligent supply chains, do brands and fashion companies consider working with these giants as an increasingly persuasive alternative?”
The rise of e-commerce and its platforms has created a dilemma for fashion companies. Until now, some of them had been somewhat skeptical about the possibility of collaborating with these online giants, but for a large number, these majestic platforms have become a mandatory sales channel now that their reach is so important and strategic.
Obviously, this situation has intensified as brands become increasingly aware that they are no longer competing only with their peers, but also with social networks and everything that attracts the attention of the digital customer. Attracted by the convenience and wide choice, more buyers look to online platforms as their first gateway to search.
This continuous and fast process has been shaping the current reality, where retail can offer and market an amazing variety of products on the web through online trading platforms. Their technology endows them with the ability to provide such detailed and in-depth product knowledge that it is completely impossible to provide in the physical store environment and to perform “one-click” transactions. However, the incredible array of different models can be overwhelming. Too many alternatives and products can make decision making difficult, leading to the possibility of fewer sales. This is where customization comes into play and explains why it has become the “holy grail” of planetary e-commerce.
AI personalizes and solves the problem of oversupply
Each of the online platforms knows what customers bought in the past, what they are buying in the present and what they are likely to buy in the future; through the analysis of consumer purchases and searches. What artificial intelligence (AI) does today is to convert large and diverse volumes of data into optimized information that can be used to improve the supply chain, from design and development to sales, marketing and customer service. The Big Data that platforms have about digital customers, combined with a set of powerful technological tools, generate new and powerful chances for fashion brands.
Therefore, brands have been reconsidering their initial position and have outlined their new strategies with the giants of e-commerce, they have become too big to ignore. As they have evolved, brands have overcome initial concerns about pricing policies, the presentation of their product and the possibility of marketing in the same space as a competitor. Access to customers’ digital footprint and data is the main objective for e-commerce platforms because having this information allows them to exercise control over the rest of the ecosystem and makes it very interesting for third parties to access their virtual space. They have the ability to gather huge amounts of data and predict what consumers want and need.
Suggestions tailored to the client’s needs-
This is the key point of customization. When the goal of individualizing customer communication is achieved, a key competitive advantage is generated for consumer companies in the era of unlimited choice. As we discussed in this previous post – Customized Fashion Supply – the fashion professionals consulted in the BoF-McKinsey World Fashion Survey considered personalization to be the number one trend in the sector in 2018. Another report from the same international consulting firm found that targeted communication, which is considered useful and relevant, can create lasting consumer loyalty to the brand and drive revenue growth from 10% to 30%. This is perfectly understandable as more than 70% of U.S. consumers expect personalized communication and products from online platforms.
As we can see, the shared goal of organizations is to create a great consumer experience, through an unlimited offer of options and with the certain possibility of simplifying the decision through personalization.
Artificial intelligence generates personalized and on-demand fashion supply.
Custom offers from e-commerce platforms can include generating incredibly accurate product search results, intelligent search engines and algorithms that focus on models shoppers may not have seen or virtual storefronts that inform individual consumers based on their personal characteristics and desires.
This disruptive and highly accurate communication with consumers is perceived as an excellent tool by fashion brands working with market-leading digital platforms because they can market their product much more efficiently than with their own means. Now, they know and understand that the platform with which they work will visualize and promote their models more vehemently to the customer who has expressed a previous interest in them or in the brand itself.
Artificial intelligence can recommend complementary products and accessories based on information on the buying habits and digital footprint of a given customer. The system can also be applied in physical stores, allowing customers to complement the style previously selected with another garment and accessories. AI recommendations can be incredibly precise and the greatness of this new technology is that it becomes increasingly efficient and intelligent with each consumer with whom it interacts, optimizing its predictive capacity.
The resounding response of fashion supply
With a personalized offer for each customer, the challenge of fashion sourcing is very important. For a solid and accurate response, the new fashion supply chain is digital, on-demand and always connected.
If you want to know in depth the qualities of this new retail supply chain, you can learn more about it in this article: The fashion supply chain will be predictive and digital.
Let’s meet again in the next article!