The development of technologies and digitalisation are a challenge for numerous traditional sectors. The analysis of fashion and luxury show that it is possible to reconcile tradition and technology!
Fashion and luxury sectors usually appear as particularly traditional, based on crafts, and labour intensive. At the same time, if we look back, we can see that technology has been at the heart of innovation in fashion and luxury for decades. In the 20th century and particularly since the mid 1960s, fashion has evolved from made-to-measure to ready-to-wear.
That industrialisation movement was permitted by the development of machines and technologies and the evolution of business models, which make fashion an exemplary case for inspiration for innovation best practices. Benetton was the first to put in place a process of late differentiation permitted by sophisticated technological manufacturing methods. Zara’s unique model is also based on the intense use of technology to track product sales and quickly manufacture products for replenishment.
In the 21st century, additional technological developments have taken place at different stages of the value chain. In terms of creation, design technologies have simplified the process and reduced lead times. For instance 3D design allows better visualisation, shorter lead-time and lower prototyping costs. These technologies have also allowed for the end customer to be involved in the customisation of its own products (mass-customisation in shoes now exists at Nike and Adidas). Regarding manufacturing technologies, 3D printing is being used by Iris Van Herpen (in collaboration with MIT Media Lab) to make dresses with a futuristic look!
Last but not least the retail scene for fashion and luxury has evolved dramatically with new business models and players only permitted by digital technologies. Stitchfix is a styling service that sends customers boxes filled with recommended products that they can buy or return. Through big data and algorithms, Stitchfix improves the recommended products … and is now developing its own products. Farfetch’s platform of boutiques, gives them an opening to the world that would not be possible without technology! Another notable example is Chic by Choice that offers renting of evening dresses, a new business model for luxury that opens new markets and customers for luxury products.
Finally, totally new actors are entering the market, this is the case of the The Blonde Salad from the blogger Chiara Ferragni that started as an influencer which is today becoming a retail player, with revenues over 8 millions euros.
In the end, fashion and luxury are an inspiration for other industries that illustrate that it is possible to mobilise technologies to preserve and strengthen tradition, at the level of creation and design, manufacturing, or retail. Other sectors should look at these fascinating developments of fashion and luxury!
Associate Professor at Católica Lisbon School of Business & Economics