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While retail as a whole is looking for ways to deploy generative AI to support operations and enhance customer experience, fashion ecommerce is likely to see some of the biggest impacts. Here’s why:
McKinsey estimates that generative AI could add between $150 billion and $275 billion to the fashion industry’s operating profits over the next three to five years.
Here are three key ways that brands can use generative AI in a customer-facing capacity.
Fashion brands already use machine learning to analyze consumer data and provide product recommendations, but generative AI has the potential to create hyper-personalized experiences, leveraging direct and immediate feedback to improve search and discovery.
Risk potential: Brands need to have enough high-quality data to support relevant recommendations, and to stay on top of maintaining it. Brands need to ensure that proprietary data isn’t shared in a manner that could compromise its security.
Generative AI tools that produce images from text and vice versa will enhance product description pages with richer and more personalized content, highlighting information that is most relevant based on specific consumer needs and preferences. Generative AI for video is advancing rapidly and will allow better 360-degree content to be created from still images.
Risk potential: The collection of personal data and role of virtual models can be controversial. Levi’s recent announcement of plans to use AI-generated models drew criticism for failing to advance real diversity. Transparency and quality control are critical when using generative AI tools to create content. More than 70% of respondents in a March 2023 dentsu survey agreed that brands should disclose the use of AI in customer-facing functions. All assets should be reviewed for accuracy and bias.
As more people explore the creative potential of generative AI tools, brands can engage them by offering opportunities to co-create products.
Risk potential: Fashion brands may not be ready to share control over design with consumers, but creators are already using generative AI tools to share imaginary branded goods. Brands will need to tackle how to address intellectual property issues associated with generative AI.
This was originally featured in the Retail Daily newsletter. For more retail insights, statistics, and trends, subscribe here.
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