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How the fashion industry is embracing digital transformation


How the Fashion Industry is Embracing Digital Transformation

With the global fashion industry set to earn revenues of $1tn in 2025, how is this growth being fueled by digital transformation? And where are fashion brands investing to secure their place in a world where consumers are increasingly drawn to immersive digital experiences?

October 26, 2022

5 mins read

Giulia Gallo

Digital transformation is changing the fashion industry.

We are experiencing a growing shift in consumer expectations, with technological innovations creating immersive experiences through the digital space.

For the fashion industry, these evolving consumer desires have driven brands to boost their investments in technology. Indeed, investment levels by fashion brands into technology are expected to rise to between 3% and 3.5% of their revenue, up from between 1.6% and 1.7% in 2021.

With global ecommerce fashion revenues set to grow to $1 trillion in 2025, let’s look at where brands are making investments – and how digital transformation is reshaping the industry.

Social commerce is gaining momentum

Already worth $492 billion, the global social commerce industry is expected to grow three times faster than traditional ecommerce, reaching $1.2 trillion by 2025. In that market, fashion and apparel looks to be the fastest-rising category.

In fact, 37% of fashion executives cited social commerce as one of the key factors that will impact their business in 2022.

It is the shopping habits of Gen Z and millennials that are driving the growth of this ecommerce channel – set to account for 62% of global social commerce. Both these generations, particularly Gen Z, seek shopping experiences that are not only quick and convenient, but also that connect them with brand and their values.

Social commerce meets these needs, providing consumers with an enhanced shopping experience that sparks discovery and blurs the boundaries between content and ecommerce.

Fashion buyers are turning towards social commerce in their search for recommendations and inspiration from people they trust and relate to on an emotional level.

As a result, brands are now investing in and building a dynamic ecosystem of influencers, platforms and marketplaces to capture data and insights that deliver superior customer experiences.

Woman taking a selfie on pink background

Connect with consumers in the metaverse

More and more fashion brands are prioritizing the metaverse in their medium and long-term investments. 

We’ve already seen the first steps towards the so-called phygital realm throughout the world of fashion in recent years, where the boundaries between digital and physical worlds have been blurred.

Brands are embracing VR and AR technology to enable consumers to try their items on virtually anytime, anywhere, boosting consumer convenience and engagement. Take Gucci, for instance, who in 2019 enabled an in-app AR feature that allows shoppers to virtually try on their line of sneakers.

For marketers, the metaverse represents a step towards experimentation and innovation, and a new way to connect with fashion consumers while pushing brand value to the next level.

Today, there’s an air of anticipation amongst both brands and consumers around the metaverse – an opportunity to create a solely digital society that also extends into the digital realm.

As an example, during the 2022 Milan Fashion Week, apparel brand Benetton announced that visitors to its metaverse store would have the opportunity to also take part in gaming experiences, where QR codes could be won that could then be used in physical stores.

This is just a glimpse into what the future consumer experience could look like over the coming years. As fashion brands continue investing in new technologies, the digital transformation of the fashion industry is an exciting one that is taking shape before our very eyes.

Fulfilment as the enabler of digital success

Returning to the physical world, whether purchasing through social commerce, the metaverse or a direct-to-consumer (DTC) website, consumers still need to receive their orders.

This cannot be achieved without brands investing in a solid fulfilment execution strategy. As growing interest in immersive digital experiences indicates a rise in online activity and, in turn, purchase opportunity, a fulfillment strategy is all but essential.

46% of global consumers expect their orders to be delivered within two or three days of purchase. Consequently, brands across the fashion industry and beyond are investing in warehouse and fulfilment technology to meet these expectations and improve the customer delivery experience.

From warehouse space to stock sufficient volumes to meet digital order demands to efficient automation technology that helps meet maximum growth potential, an optimized fulfilment solution remains the enabler of realized digital success, from first click to final mile.

Like many industries, fashion is undergoing a digital revolution. However, the ways each brand chooses to approach this new chapter are nuanced and diverse.

With the arrival of social commerce and the metaverse comes opportunities to innovate and craft new and unique customer experiences.  

The examples above are just a few ways that the fashion industry is embracing digital transformation to reshape their own business growth.

If you want to join the brands at the forefront of fashion’s digital transformation, Ingenuity is the partner you need. Get the technology, digital and operations infrastructure you need to meet the changing expectations of consumers today.

Get in touch and start reaping the rewards of your digital transformation journey.



Digital transformation

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