Artificial intelligence (AI), the metaverse and ChatGPT are creating the biggest buzz so far this year, and it’s no surprise to see the fashion industry catching the wave. 

Last year saw numerous brands launching virtual collections, including Gucci, Adidas, Zara and Prada. Gucci’s “digital shoes” are only designed to be worn in the metaverse, there’s no actual physical product available. Australian online retailer The Iconic has auctioned its first NFT to celebrate its Runway X Metaverse show.

As brands continue to find their way in an ever-changing digital world, they should consider how they can use AI within their current operations to the best of their advantage. What new opportunities can AI provide? And what role can ChatGPT play?

The industry has already started moving into the metaverse. During the pandemic, bricks-and-mortar shops were off limits and online shopping had to up its game. E-commerce platforms were quickly modernised, bringing in rudimentary AI functions and virtual reality (VR). 

Retailers had already been using AI to a certain extent, but after a couple of years of “getting to know how it works” we’ve reached a point where its inclusion is something that can’t be ignored. The size of AI in the retail market exceeded US$2 billion in 2020 according to Global Market Insight and is expected to grow at more than 30 per cent between 2021 and 2027.

Here’s a look at some of the key ways we’re seeing retailers using AI today:

• Fashion design and buying: AI can be used to analyse real-time trends and customer feedback, thus speeding up the process from insight to production. Retail analytics platform Style Arcade provides intelligent fashion merchandising recommendations to retailers and brands, including The Iconic, Aje and PE Nation in Australia. 

• Virtual try-ons: Virtual fitting rooms can help customers visualise what an item of clothing or accessory will look like on a mannequin of a similar body or facial shape. Several eyewear brands, including Sunglass Hut and Australian eyewear retailer Bailey Nielsen, offer virtual try-on to shoppers. Sunglass Hut also collaborated with Emperia VR to develop the virtual store Sunglass Hut Utopia. Bailey Nielsen is reported to have increased online sales in Australia by 400 per cent after implementing virtual try-on technology. 

• Virtual models: “Digital muses” are replacing human models in campaigns. Sydney-based brand Injury also allows customers to shop for digital clothing modelled by avatars. While Australian online fashion retailer Showpo in collaboration with Meta is showcasing products on a diverse range of AI 3D models.

• Virtual stylists: Brands such as H&M are using AI-powered chatbots to answer questions about product availability, provide styling advice, and help customers place orders. Australian fashion retailer Cue is also leveraging AI-based personalisation to offer virtual styling services.

• Marketing: AI can also help provide insights into the ideal target market for a product. Luxury goods brand Shinola initially designed its Vinton watch with women in mind, but discovered through MakerSights analytics that it appealed to all genders, and deepened its buy-in by 70 per cent.

How can AI genuinely help?

There are numerous applications for AI in retail operations. Some of the key ones include:

Greater efficiency

In general, AI will make people more efficient at what they do. Many low-medium skill, time-intensive jobs will be removed or automated. ChatGPT can already write code, quickly and accurately. Speeding up the time taken to complete simple tasks will enable companies to take on initiatives that weren’t previously cost-effective in terms of risk or time to success/failure.

Packaging design

AI can design packaging and labels based on product positioning and strategy documents. Previously, focus groups and market research helped achieve the perfect logo or design. Now it can be done digitally. 

Multilingual support

AI technology like Deep can provide instant support for many languages through high quality automatic translation. This is extremely important for brands with an international reach.

Personalised brand marketing

This is a very hot topic in fashion where AI can play a powerful role. It can create much more significant personalisation by sifting through vast amounts of data already collected on individuals, and comparing it to like-minded individuals – much more intelligently than “other people who bought that also bought this” – dynamically figuring out what is most relevant to that person. Taken even further, AI in the future could spin up whole websites dynamically, tailored to a brand, a demographic, or even an individual.

Should employees be worried?

The reality is that many jobs are going to be changed by automation. While there are jobs that will be made redundant because technology does them more efficiently, history has shown that it will also create new jobs which didn’t exist before.

Companies that embrace digital and invest in AI will need to hire people who understand how to work with it in order to make it effective across the organisation. As some commentators have observed, “A human with AI will replace a human without AI”. With the rate AI is expanding in the retail industry, that could mean a significant number of job openings.