Changing consumer demand and preferences is a fast-moving target, but artificial intelligence is helping fashion apparel brands and retailers keep pace with the changes while protecting sell-through at full price points and managing seasonal operations, according to Aptean‘s new research report.
At the same time, however, the report’s authors said, “Many organizations are discovering general-purpose AI tools are not designed for the realities of apparel, where styles, colorways, size curves and fragmented supplier networks create additional layers of complexity.”
Aptean said to better understand how the industry is approaching AI, it teamed up with research specialist Vanson Bourne to poll 245 fashion and apparel executives. The research was part of a broader study of more than 1,500 professionals across five business sectors.
So, how do fashion apparel retailers and brands stack up against other sectors? They are well ahead of the curve.
“Apparel organizations are the most likely to have adopted industry-specific AI (53 percent) and custom-built AI solutions (55 percent) of all sectors surveyed,” the report stated, also noting that fashion industry respondents “report positive gains from AI in competitive positioning (41 percent) and workforce morale (also 41 percent) over the past 12 months, more so than any other surveyed sector.”
Researchers also found that strong governance measures help build confidence in AI autonomy. Three-quarters of those polled said having robust data governance in place “is necessary before they’d allow AI to make decisions on its own, and 68 percent say clear escalation/incident management procedures are required.”
In regard to deploying different types of AI, industry-specific was found to be key. “Unlike general-purpose AI, these solutions are designed around the complexities of the industry: managing styles, colorways, size curves, seasonal collections, long supplier lead times and in-season trading,” the report’s authors said. “Planners and merchandisers can make faster, more informed decisions before excess inventory turns into markdowns and lost margin.”
However, the data showed that only half of organizations polled said they’re using these solutions today—leaving considerable room for future adoption in the industry.
The research also revealed that fashion apparel companies are upgrading their tech stack to support future AI growth. And that means the cloud. “Almost half (46 percent) plan to move at least some of their on premises enterprise solutions to the cloud over the next 12 months,” the report’s authors said. “By making product, inventory, sales and planning data more connected and accessible, cloud platforms can support future AI adoption.”
Moving to cloud solutions is influenced by the sector’s realities, the report noted. Fashion apparel retailers and brand are less likely than average “to cite security, risk, or compliance as motivation for adopting these technologies (38 percent versus 46 percent) and more likely to be driven by competitive pressures (35 percent versus 29 percent),” the report stated. “That tracks given that cloud infrastructure gives planners (and apparel-specific AI tools) faster access to the product, inventory and demand data needed to respond before seasonal opportunities are lost.”
As noted, before, consumer demand and preferences change rapidly, and AI can help keep brands and retailers up to speed. Compared to other sectors, say consumer electronics or home goods, the product development cycle moves at a snail’s pace.
When asked why larger apparel brands are moving faster on adopting AI, Ken Weygand, solutions architect at Aptean, said, “It’s coming from the top down. Boards are asking their C-suite to come back with specific areas, department by department, where they think AI can help.”
It’s also important to note that the faster a company adopts and onboards AI, especially industry-specific solutions, the faster they will likely see the benefits to their workflows. In the broader sector study, researchers found that 24 percent of executive in fashion apparel said AI was essential to workflows and decision making, which compares to 23 percent in food and beverage, 21 percent in equipment dealers and 15 percent in manufacturing.
