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Digital Transformation Reshapes the Fashion Industry: Social Commerce, Metaverse, and Fulfillment as Key Drivers
With global fashion industry revenues set to surpass $1 trillion by 2025, digital transformation is accelerating growth in this sector. As consumer expectations evolve with technological advancements, fashion brands are capitalizing on immersive experiences offered through digital platforms.
Investments from fashion brands into technology have escalated, expected to increase between 3 and 3.5 of revenue compared to the previous levels of 1.6 to 1.7. The anticipation for $1 trillion in global e-commerce fashion revenues by 2025 highlights the pivotal role digital transformation plays.
Let's dive into where brands are focusing their investments, exploring how technology is reshaping the fashion landscape:
Social commerce, estimated to grow three times faster than traditional e-commerce and reaching $1.2 trillion by 2025, has already amassed a staggering valuation of $492 billion worldwide. Fashion and apparel are set to be its fastest-growing category, making up approximately 62 of global social commerce market share.
A key factor driving this tr is the shopping habits of Gen Z and millennials – comprising nearly two-thirds of social commerce users. These generations, especially Gen Z, seek quick, convenient experiences that connect them emotionally with brands through shared values.
Social platforms facilitate these needs by offering an enhanced shopping experience that fosters discovery while bridging content consumption and ecommerce transactions. Brands are now investing in influencer networks, platform partnerships, and marketplaces to capture insights that deliver superior customer experiences.
Fashion brands are increasingly prioritizing investments in the metaverse for medium-term and long-term growth prospects. The concept of the phygital realm, where physical boundaries merge with digital spaces, has been a recent tr.
The adoption of virtual reality VR and augmented reality AR technologies allows consumers to virtually try on items at any time or location, enhancing convenience and engagement. For instance, Gucci launched an AR feature in 2019 enabling customers to virtually try on sneakers within the app.
For marketers, the metaverse represents a frontier for experimentation and innovation, providing new ways to connect with fashion consumers while elevating brand value. The anticipation around the metaverse among both brands and consumers is creating an exciting future that blurs digital and physical experiences.
While immersive experiences are on the rise through social commerce and the metaverse, consumer expectations for timely delivery persist. Brands must invest in robust fulfillment strategies to meet these needs effectively.
According to global consumer expectations, 46 anticipate their orders to be delivered within two to three days after purchase. To address this demand, fashion brands are upgrading warehouse infrastructure, stocking sufficient inventory, and implementing efficient automation technology.
Optimizing fulfillment solutions is essential for realizing digital success, ensuring a seamless transition from online order placement to final delivery.
Fashion's embrace of digital transformation showcases innovative strategies and diverse approaches tlored by each brand. The integration of social commerce, the exploration of the metaverse, and advancements in fulfillment are key drivers of this evolution.
These developments offer opportunities for innovation and crafting unique customer experiences that cater to evolving preferences. Joining brands at the forefront of fashion's digital revolution requires leveraging technology, digital infrastructure, and operations expertise.
Partner with THG Ingenuity to access comprehensive solutions designed to meet the changing consumer expectations in today's dynamic retl landscape. Accelerate your journey toward growth through our technology, marketing, and fulfillment services.
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