Forecasting the Future of Fashion: How Big Data can reshape the Fashion Industry
By Iva Mirbach
Fashion does not only belong to one of the biggest commercial industries - it is also part of a large and distinctive history. Historically, it is challenging to pinpoint the advent of fashion, but clothing is something, which has been used since human development. However, fashion as we know it today arose in the 19th century with Charles Frederick Worth, who began his own brand label by being the first to put his name on the garments he created. It is clear the history of fashion pre-dates the history of the 'fashion industry'. Clothing existed before the industry, but it was the mass production of clothing, which became a need in the mid-nineteenth century, and only after a few decades did it turn into a lucrative business. Since its inception, the business of fashion has been undergoing drastic changes, yet certain business models and trends return in a new and advanced way that fits the particular structures of modern society. Currently, the fashion industry is in a situation of complete disorientation between what was and what will be.
The concept of the traditional fashion catwalk is undergoing a revolution influenced by several crucial aspects. Even media is beginning to question if fashion shows, as we know them to be, are coming to an end? The fashion industry must rethink the conventional concept of how fashion shows are promoted as well as reconsider its usual exposure with the press and marketing.
The Fashion Calendar was established in 1945 and aimed for fashion shows to bring together buyers, manufacturers, editors, designers and media in order to preview the next season's collections and trends. However, technology has completely altered how the industry functions, particularly with social media and 'Fast Fashion', which has resulted in an increasing number of customers consuming online rather than offline.
Previously, fashion shows were accessible to an elite few, but as designers and influencers start to make the fashion shows available to a worldwide audience through ongoing postings to Facebook, Twitter, Pinterest, Instagram and other social media platforms - no one wants to wait six months until clothes hit the stores. By the time the last model has walked off the runway, the entire event is already posted to Instagram. Since social media has created an instantaneous culture, as soon as consumers see the latest collection online, in that very moment they expect to be able to purchase it. The future of the fashion show is being redefined with more brands shifting their focus from private trade-only presentations to consumer-driven entertainment marketing events, such as ordering directly from the runway, to live social media campaigns.
Furthermore, the concept of fast fashion has proved its worth, and can be seen through the success of brands such as Zara, H&M, Topshop and Forever 21. It has become evident that bringing out new items every two weeks is leverage to better adjust product lines to the demand of current trends. Many of the brands participating in this new trend are those with strong digital presences and innovative marketing campaigns, which specifically target the younger and more internet-savvy generation. It is therefore no surprise that the first high fashion brands, such as the British label Burberry, are following this concept by starting to make 'season-less' collections that are available to purchase immediately.
On the other hand, the runway-to-retail approach does not suit the customers of luxury houses such as Chanel, Dior and Hermes. Moreover, another fundamental change inside the fashion industry is the fact that online fashion retailers are becoming increasingly important for fashion brands, particularly for luxury brands. As a result of their purist view of luxury, which has always been about exclusivity, many luxury brands have up to now avoided the 'digital game'. Now, it is challenging for luxury brands to maintain their own websites and keep up with the fastpace, as they do not have the same amount of customer data as a third-party retailer such as Yoox, Net-a-Porter or Neiman Marcus.
Due to the increasing popularity of online shopping, the trend has already been recognized by other brands, which has led to an expansion of online fashion retailers. Even large traditional groups like Conde Nast, managed to re-establish their most successful website style.com by converting it from a fashion-only platform into a fashion retailer website. Somehow, retailers seem to have become the 'new' fashion magazines.
This suspicion could be confirmed by the fact that it is definitely more beneficial and efficient for a brand to place their products directly inside an online store instead of paying for advertisements inside fashion magazines, often for an extravagant amount of money. Is seems that having Karlie Kloss photographed by Mario Testino on the cover is not as prestigious as it used to be, and is certainly not enough for brands to continue functioning in their old business relationship.
Beyond that, established online stores have a wider audience-reach as magazines and their experience in online shopping is more useful for luxury brands to gain ground online. With this move within the fashion environment, traditional and established fashion magazines must rethink their business model. Already many print magazines have decided to fold following loss in revenue, as they could not sell enough advertisements to cover the cost of production, in addition to being unable to handle digital media competition.
Although fashion journalism has been an influential institution since the turn of the twentieth century, another reason why this profession has been increasingly losing on authority is the growing influence of social media. Fashion is dynamic, changing in both subtle and dramatic ways, depending on designers' artistic inspiration, and trends are often based on styles of public figures. In the past, the fashion world was small and exclusive - its members set the style agenda. The media also published in an orderly, controlled way. Today, the industry is global and social media influencers have increased its range of impact by providing the public with an up-close, individual view of fashion style, impacting the development of public interest and trends.
In a world where a trend can circle the globe with the click of a mouse or the post of a picture on Instagram, new technologies, which can forecast trends, are in great demand and 'Big Data' is now becoming increasingly important within the fashion industry. Since the impact of social media influencers has become a significant role in trend-making, the word 'TREND' has become highly valuable. Every day, new emerging Artificial Intelligence (AI) Systems are being developed, and most of them are focused on analyzing current social media patterns to predict the next fashion trend.
But what does it mean to trend inside the fashion industry, and how long does a trend last? 'Trend' can be defined as something versatile. There are short-term and long-term trends: short-term trends are changing quickly and are linked to becoming outdated as soon as they are fashionable. Social media is a perfect instrument to explore, which particular pieces are becoming trendy at any moment, whether it be in in terms of color, pattern or fabric. For fast fashion brands, AI-systems which forecast short-term trends are desirable, as their business model is based on low stocks and several in-season updates.
Furthermore, the next season's trends are already defined by the fashion industry - we already are aware of which colors, textiles and patterns are being considered for the Spring-Summer 2018 season. However, the challenge lies with predicting, which of the given guidelines are going to become trendy, since not all colors, textiles and patterns will be used by the designers and not all of them will attract the customers. Considering all these facts, an analysis of short-term trends for fast fashion brands is necessary, in order to adapt current production to the current trend movement.
In contrast, long-term trends are more durable and it is unimaginable that they will disappear from the world of fashion in the near future. A long-term trend could be a fashion brand, which is quite established or has become popular as a result of a certain style.
However, reasons for becoming trendy can also be due to popularity of particular clothing. For example, a Burberry trench-coat or a classic Louis Vuitton handbag are something which will never become old-fashioned. This is proved by the fact that having a 'vintage' piece of a clothing or accessory remain trendy because of the recognition-value for a specific item for which a brand is famous for.
Not all modifications inside the fashion industry are suited to all fashion brands, in particular to luxury brands. Currently, one of the main problems with high fashion brands is the need to compete with the fast fashion industry in terms of trend-making, which is done by increasing the number of collections brands produce, as well as the speed with which they take those collections from the catwalk to the retailers.
Nevertheless, forcing the cycles of luxury collections to run at increasing speeds results in not only a loss of creativity, but a loss of exclusivity. And as the 'artificially' produced trend begins to change quickly, consumers are less willing to spend more money for original designs from a luxury brand which will likely be out of season in a short time anyway. Rather, consumers opt to buy similar items for more affordable pricing. However, there are some designers who continue to capture the very essence of luxury: sustainability, while continuing to create only one collection per season.
Furthermore, high fashion brands have been notorious for their unwillingness to progress online. The rise of mobile and e-commerce is notably relevant in the fashion industry, yet some fashion brands are slow to keep up and could do with more efficient mobile management. Small luxury brands are slowly catching up to speed, but with consumers spending more time online, these brands will need to create a more fluid shopping experience in order to successfully leverage e-commerce.
However, in a world where a Chanel suit can cost on average 8,000 euros, and a Louis Vuitton handbag 3,000 euros or a Harry Winston bracelet which could easily reach more than 50,000 euros, high fashion is allowed to remain exclusive, since their target consumer behavior is unique compared to the typical mass market consumer. For instance, a high fashion consumer is likely to have trust in the opinion of renowned fashion experts, such as Anna Wintour or Anna Dello Russo, when it comes to evaluating new fashion designs and trends - this is one of the reasons why traditional fashion magazines continue to exist in this fast-paced industry.
Social networks and apps are one of the main reasons why e-commerce is on rise, but for some brands, such as Hermes and Chanel, an advertisement inside Vogue or Harper's Bazaar is highly valued and sought after compared to a post on Instagram or Facebook. Nevertheless, fashion magazines do face challenges as they are not necessarily adapting to modern expectations and patterns while continuing with an otherwise older operating concept. Many in the fashion market still love to observe fashion editorials where experts and creative people from the industry interpret with their artistic view of how current collections and beauty trends could be changed in different situations and environments.
After all, many do not want to afterwards spend time browsing where they can buy the looks. Magazines should begin to integrate technical functions next to fashion credits. By doing so, consumers would simply need to place their smartphone over a QR-Code on the page, such as the QNECT technology used in our loveFMD magazines, and a website would immediately pop up, containing with it links directly to the exact items a consumer desires. This would allow for instant and easy purchases, and is just one of many ideas on how to connect the offline fashion world with the online. In this case, magazines could start to charge online retailers for linking to their shops and increase their income as an exciting transformation, which would meet the needs of both, fashion magazines and consumers.
It is clear that AI-Systems must consider offline fashion trends, and the only system, which actually does this, is the IFDAQ (International Fashion Digital Automated Quantification). What sets IFDAQ apart from other systems is its ability to not only focus on online trends, but also to simultaneously observe all other patterns and trends in the fashion world.
Combining the online and offline worlds into one tracking system is naturally a big challenge facing the fashion industry, but is what IFDAQ successfully accomplishes. With the unique ability to measure non-numeric objects, such as parts of a single page inside a magazine, IFDAQ contains the knowledge and value of every single entity on a single given page and therefore can measure and quantify the impact, power, trend and influence of a particular item or model.
This quantification system is used to support clients in their analyses, researches and plan their work in the fashion industry, and what the work may be, in order to make the best decision at any point in time. As the first real Fashion Intelligence Unit, the IFDAQ effectively monitors all aspects of the fashion industry in real-time, armed with vital information such as the daily real market value. As a result, players in the fashion industry are able to understand the impact of, for instance, an editorial, down to a single image, and predict the market value of a magazine as a result of the many indicator values which influence its worth.
As trends and customer behavior within fashion industry changes, the IFDAQ team, which also includes some leading scientists, is continually working on new technologies to follow up on the rapidly changing nature of the industry. With a unique combination of the most advanced techniques in Artificial Intelligence, Big Data and Scientific Quantification, the IFDAQ will soon publish the first official 'Fashion City Rating List' named 'FACER' as part of an ongoing research project.*
Clearly, the fashion industry has undergone significant changes since its inception, and will continue to undergo changes so long as technology is inventive. Thus, particular aspects of it, especially more traditional modes such as fashion magazines, must begin to adapt to the consumer demand, while at the same time benefiting from such changes. Online as well as offline fashion business are critical for forecasting trends. It is only through AI systems, like the IFDAQ, that successful adaption through offline and online fashion trends, vis-a-vis connecting relations between online and offline fashion business can be attainable.
*The list will display a ranking of the most important fashion cities based on their worldwide market volume, industry share, turnover potential and overall influence.
This article first appeared in the Spring/Summer 2017 issue of LOVEFMD magazine. Head over to http://www.lovefmd.com to download your free copy. For more information on The IFDAQ visit http://www.ifdaq.com/.
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