The Rise of Industry 4.0: from manufacturing line to shop floor
LONDON, United Kingdom – Fashion houses and brands have been slow to join the digital takeover in adopting new strategies to keep up with the growing influence of the internet and development of other state of the art technologies.
Around 80 percent of sales are influenced online, according to a McKinsey report – yet it wasn’t until 2018 that Chanel finally acknowledged the revolution, launching a narrow range of products available on its e-commerce site.
It’s not only online retail that can transform business models – the likes of artificial intelligence, blockchain technology and personalisation are among the game changersfor fashion brands today.
“Brands cannot afford to not think about digital because if they don’t they will be left on the side,” said Benny Giang, product growth manager at Dapper Labs, a Vancouver-based start-up connecting consumers to Blockchain technology through fun and games.
As the power shifts from baby boomers to late millennials and now generation-Zs, brands face increasing pressure to not only be transparent but operate on a leaner business model.
One way to do this is to digitalise the process.
“It is a competitive advantage for any business meaning you can optimise your resources better, create a much better product but use fewer resources”
Industry 4.0
The use of A.I, artificial intelligence, in fashion goes as deep as the manufacturing floor to the forefront of consumerism in the form of personal styling.
“The use of A.I encourages operational efficiency. It is a competitive advantage for any business meaning you can optimise your resources better, create a much better product but use fewer resources,” said Valerie Tetu, marketing manager at Intelistyle, an A.I styling company.
Portugal-based company Smartex.ai are working on an A.I vision system that can detect fabric defects. It is estimated that more than $33 billion worth of raw material is lost as a result of defective production. This can be anything from snagged threads, discolouration and dodgy hems. The software will detect defaults in real time reducing the number of faulty garments produced.
“The current solutions are completely dependent on inspection workers looking at these textiles all day and all night trying to spot the defections with their own eyes. This solution is both expensive and ineffective,” said co-founder Antónia Rocha at the Web Summit 19.
“At Smartex we developed a patented system of cameras that we can plug in play every knitting machine, using machine learning algorithms that can detect all types of defects in real time during production and consequently reduce the defects to close to zero percent,” Antónia added.
The prototype is currently running in several factories, and brands such as Calvin Klein and Tommy Hilfiger are interested in using the technology. The machines are designed to have as little user interaction as possible. Managers can use a dashboard to interact with the machine to maximise profits.
The Smartex.ai software is a small step in the direction towards ‘Industry 4.0’. The term refers to a fully digitalised model for manufacturing as described in McKinsey’s report the age of digital Darwinism. The new seamless system ties together self-aware machines in factories, smart logistics, customer data and design. As a result of these connections, companies can react faster to shifts in demand and customer needs, in turn reducing costs, waste and the overall impact on the environment.
Commercial A.I
Personalisation is a holy grail in the industry when it comes to consumers. In fact, brands can see an increase of five to 15 percent in revenueswhen it adds personalisation to its site. A.I software is most commonly used as a styling software. It is one of the top resources brands can use to add personalisation to their e-commerce platforms.
A.I styling services company Intelistyle provides software for big retailers including Japanese-based Lane Crawford, Rakutan, Dolce and Gabbana and Max Mara. The software searches the brand’s database and styles the products according to the latest fashion trends, the brand’s own particular style and customers’ personal taste.
“When we work with one brand, at Intelistyle, we take the time to calibrate the model,” said marketing manager Valerie Tetu. “Styling recommendations for one brand are not necessarily the same for another brand because they may have very different styles.”
It takes approximately one week to fully integrate the styling software as the A.I does it automatically. The company programmes the A.I to style a brands’ clothing in line with its values, such as maximalist styling for Dolce and Gabbana, as well as current styling trends from fashion week and on social media. Intelistyle are also able to offer brands veto styling options which they programme into the A.I. For example, coding the software to suggest a specific shoe with the latest collection of dresses.
“We work with approximately 10 to 15 brands directly and we work very closely with their teams in order to be very tailored to them,” added Valerie.
“A lot of people have difficulty knowing how to style things that use past clothing in a current way, they’d rather go straight to the store and buy current clothing.”
The same A.I technology is used in many styling apps consumers can use at home. Intelistyle, who is now focused on b2b, also run an app where users are able to upload images of their wardrobe and the software styles outfits based on the users’ styling preference and local weather conditions.
“A lot of people have difficulty knowing how to style things that use past clothing in a current way, they’d rather go straight to the store and buy current clothing,” concluded Valerie Tetu. “But we can show them that you can use pre-owned clothing and it can look a completely different way if you style it differently. A.I enables you to do that because it understands what is trendy.”
Rise of Blockchain
Alongside the use of growing use of A.I in the industry, fashion brands are embracing the Blockchain. Blockchain is an umbrella term for technology that permanently records transactions in a digital, secure database. The information is distributed across a network of computers and is accessible to anyone in the network, but cannot be altered or deleted.
“Brands have been very cautious when they’re making these moves with partnering up with a specific Blockchain because then it could really impact their reputation.”
“The entire Blockchain space has grown quite a lot in the last couple of years,” said Dapper Labs founding member Benny Giang. The most popular form of Blockchain is crypto-currencies like Bitcoin. “In any innovation that has come out, there has been a lot of scammers. Big brands have been very cautious when they’re making these types of moves with partnering up with a specific Blockchain because then it could really impact their reputation.”
Luxury fashion’s biggest challenge is safeguarding the authenticity of luxury goods. According to the OECD, Organisation for Economic Co-operation and Development, the global market for counterfeit goods is worth over $450 billion; that makes up 3.3 percent of the world’s trade. As the global resale market continues to increase in value, trying to prove authenticity is becoming a key focus among luxury brands.
LVMH set up its own Blockchain technology in partnership with New York-based Blockchain software firm ConsenSys using Microsoft technology. Its new tool, called “Aura”, will allow the group to certify all Louis Vuitton goods and will also be used for Parfums Christian Dior.
Paris-based Arianee, which boasts advisors from Richemont and Kering, luxury conglomerates, launched its digital certification platform last year and has 12 exclusive brands on board including watch company Breitling.
With brands running on blockchain platforms, consumers and retailers will have little doubt over the authenticity of luxury goods as they can be traced back to its original source.
“The blockchains are very slow right now, that’s a huge drawback,” said Benny Giang, creator of Cyrptokitties, the first blockchain-powered game that allowed users to collect and trade virtual cats. “The way I see it is like the internet in the 90s, when it was very slow. It’s nothing like we have now with the internet where it’s seamless and every place has WiFi. It’s a very technological problem which can be solved and I think a lot of people are working to make it faster.”
A technology-focused future
The fashion industry is set to change within the next 10 years. The digitalisation of steps within the supply chain can only help to aid the industry in terms of becoming more efficient, more sustainable and encourage it to operate on leaner business models. With the possibility of industry 4.0, increased use of A.I and Blockchain, it seems fashion brands are finally deciding to embrace the digital age and bring themselves into the 21st century.
