Tommy Hilfiger, for instance, made it to the news in 2015 when they used Samsung VR devices to provide front-row runway experience to their customers within the retail space.Īlibaba too has been playing around with AI since they launched their FashionAI stores which feature intelligent mirrors and smart garment tags. Physical stores can not only use AI to leverage inventory management and marketing initiatives, but they can also use AI to offer exclusive user experiences. Virtual Reality (VR) and Augmented Reality (AR) are the most promising AI technologies, expected to overtake in-store shopping experiences in the coming decade. This has been considerably effective in resolving the problem of product returns due to size-fit issues, which is a major challenge for the online retailers. AI helps to monitorcompetitors’s prices using freely available data and to determine competitive price points accurately.įashion e-commerce sites also use AI to improve size recommendations on a product-by-product basis, by analysing previous purchase data of consumers. Newer brands try to grab market share by quoting lower prices, and established brands tend to push their price points to maximise margins. In a highly saturated market like fashion retail, brands experiment with their pricing strategies depending on their market positions. Marketers use chosen keywords to virtually eavesdrop into social media conversations, and the knowledge they gain is used to either improve strategic decisions or target potential consumers. In fact, fashion retailers benefit greatly from AI applications such as social listening, where tools can be used to “listen to” and analyse what consumers are saying about a brand, its competitors, or specific topics of interest on social media.
This data is used for repeatedly targeting the said consumers with ads and reminders about the product, which results in higher levels of conversion. Data driven decisions like these are great tools for combatting overstocking, and lead to better inventory turnover.īrands employ AI algorithms to identify which consumers are likely to make a purchase soon, based on their searches and number of visits made to the site. The said knowledge can be used by purchasing departments to determine the volume of products to be stocked. Based on past sales data, it can help to identify categories, designs, and colors that are experiencing high demand and also the ones that aren’t. This makes the shopping experience convenient for the buyers and helps brands to score more conversions.Ĭonversely, visual recognition plays an equally important role at the sourcing end for retailers. Ecommerce fashion retailers of the day unanimously use visual recognition to recommend similar looking products to their consumers, based on their respective search histories. We’re all familiar with the product recommendations offered by sites like Amazon. AI facilitates immediate recognition of changing trends that help these brands to stay on top of their games, and deliver instant gratification to their consumers.īeyond prompt fulfillment, personalisation is another factor that consumers look forward to, and this is where AI-driven visual recognition comes into play. The million dollar (literally) question is, how exactly do they predict trends so quickly? Today, brands like ZARA and Shein churn out clothes that fit into the fad within a turnover period of 15 days. While physical stores have a unique set of usage for AI, it’s the e-commerce retailers that are the chief worshippers. To understand the impact of AI on fashion retail, let’s first divide the industry into its two primary channels - ecommerce and brick-and-mortar stores.
It would be hard to name an industry that isn’t growing increasingly dependent on AI, and fashion retail is no exception. AI, compared to the “Demon” by Elon Musk and to “God” by Alan Perlis, is omnipresent today. It would understand exactly what you wanted, and it would give you the right thing.” - Larry PageĪI grants us the power to understand exactly what our consumers want, and this power, when leveraged correctly, can be the quickest path to success. The ultimate search engine that would understand everything on the web. “Artificial intelligence (AI) would be the ultimate version of Google.