Luxury Fashion and the Emergence of Digital Technologies
The world of luxury fashion has always been known for its exquisite craftsmanship, intricate designs, and attention to detail. However, as the pandemic continues to influence the retail industry, luxury fashion retailers are turning to digital technologies to connect with their customers and drive business growth. From big data and new apps to intelligent automation and omnichannel optimization, luxury fashion brands are finding new ways to leverage technology to streamline the customer journey, personalize experiences, and optimize inventory management strategies.
At Stefanini, a leading provider of digital transformation solutions, we specialize in servicing luxury fashion brands and helping them leverage emerging technologies to stay ahead of the competition. In this article, we take a closer look at some of the top digital trends in luxury fashion to keep your eye on in 2023 and beyond.
Artificial intelligence (AI) is King
Data analytics and hyperpersonalization are driving the use of AI-powered technologies in the luxury fashion industry. By tracking customer journeys and matching customers with the right products, luxury fashion brands can monitor inventory, forecast trends through data, and predict customer behaviors and preferences. AI-powered technology solutions are also making it easier for luxury retailers to implement sophisticated inventory management strategies and optimize omnichannel efforts for a seamless shopping journey.
Keeping it Real with Digital Tech
In today’s world, authenticity and brand cachet are everything. New digital tech advances like product identity recording (PIR) are game-changers in the retail supply chain. PIR provides a physical-digital link that records every stage of production, leading to improved sustainability and increased brand sentiment. PIR is being used to follow products and supply chains, preventing counterfeit goods, identifying the last party to gain custody of the product, tracking new merchandise shipments, and capitalizing on transparency to advertise exclusivity to consumers.
Know your Audience
In luxury fashion, 80% of revenue comes from 20% of customers, making it essential to maintain strong connections with customers and have a nuanced understanding of their priorities and preferences. New apps are driving microtargeting and hyperpersonalization for limited releases and exclusive offers, allowing luxury fashion brands to identify when customers are in specific stores and deliver targeted offers based on history and preferences. With cutting-edge platforms, data can be gleaned through facial scanning and sentiment analysis for enhanced insights into customer behavior and sentiment.
Intelligent Automation and Omnichannel Optimization
Luxury fashion brands that adopt intelligent automation, cognitive automation, or hyperautomation can equip sales teams with information about the location and availability of products (both in-store and online). This increases scheduling productivity and accuracy and automates end-to-end processes. With details about individual customer preferences, sales associates can provide elevated and personalized service—a defining characteristic in the luxury space. Practically, with the global supply chain becoming more hectic, sophisticated and transparent merchandising and inventory management are more critical than ever for luxury fashion brands.
The Power of Data
The most sophisticated technology tools are only as good as the quality of the data collected. In-store data collection and utilization are related to customer experience and provide new insights that can enhance the shopping experience and improve overall store design. Brands are increasingly turning to digital/social media to track sentiment and provide incentives to third-party partners to share collected data. More brands are also using sensors, computer vision, and radio frequency identification (RFID) technology to measure foot traffic within and outside the store, ultimately leading to useful insights.
Creating a Seamless Experience with Diverse Technology Stacks
Investing in a diverse technology stack that benefits customers as well as retailers builds positive brand associations and cater to personal profiles and purchasing habits with tailored products and store experiences. Implementing new technology, consider how well the solution can learn more about your customer, implement sophisticated inventory management, optimize the supply chain, drive in-store engagement, create personalized customer experiences, and support seamless omnichannel efforts.
The Next Big Thing
For decision-makers, it’s essential to evaluate which tools make operational and financial sense for your brand. Determine if a solution enables you to learn more about your customers, implement sophisticated inventory management strategies, facilitate supply chain optimization, drive in-store engagement, create personalized customer experiences, and support seamless omnichannel efforts. Consulting with an experienced technology partner to assist in selecting and integrating new technology in a thoughtful and strategic manner can help businesses stay ahead of the curve.
In conclusion, emerging digital technologies are becoming increasingly important for luxury fashion brands to stay ahead of the competition. With AI, PIR, intelligent automation, and omnichannel optimization, luxury fashion brands can streamline the customer journey, personalize experiences, and optimize inventory management strategies. By using sensors, computer vision, and RFID technology to measure foot traffic and social media to track sentiment, brands can gain new insights to enhance the shopping experience and improve overall store design. By investing in a diverse technology stack, luxury fashion brands can differentiate themselves and remain leaders in the industry.
