But…what is FashionTech?!
Continuing our journey to learn about all sorts of xTech out there, FashionTech was inevitable. The Fashion and Retail industry is scurrying to find new ways of luring customers – there is a lot of talk of ‘digital’ and ‘experience’ and a combination of the two. What is FashionTech really though? Seems its hard to put it in a box and certainly a simple google search will not give you a canned definition. Who knew that the world of Fashion is so nuanced, also when it meets with Technology ; )
We will be daring enough to attempt a definition (à la SSUP), based on all we’ve learnt. For our consultant and aspiring-consultant friends out there, be fairly warned that this may not match your MECE and anti-fluffy standards
Fashion Tech is at the intersection (think Venn-diagram) of ‘Fashion’ and ‘Technology’, encompassing the application of technology to enhance the entire value chain of Fashion and Retail. The emphasis of the application of technology is more on business model innovation and then using relevant technology as an enabler, rather than ‘deep technology’ for the sake of technology itself and then looking for a fashion-related application of that.
What is this value chain in fashion and retail that we speak of? In a simplified way it can be the classic product design funnel, as follows, with some examples of innovative tech applications being used today in fashion.
There are some innovations like online 3D design tools that disrupt the entire value chain itself and give the designing process into the hands of users themselves. Checkout this article for interesting FashionTech startups to look out for, that use some of the applications mentioned above
One excellent example of such disruption is Faber Novella, a London-based start-up founded by Victoria Burlacu (INSEAD MBA 12). Faber Novella offers high-end women’s footwear entirely handcrafted in Italy. What makes it extra special though, is their innovative online platform (indeed, online atelier) and model, that allows clients to take part in the creative process and customise their own shoes online – to get their own unique pair then handcrafted in Italy and delivered right to their doorstep.
Victoria herself was looking for a challenge beyond the ‘traditional’ post-MBA paths. Being inspired by case-studies doing the Process & Operations Management class at INSEAD, the seed for Faber Novella was very much sown during business school but it took Victoria more than 3 years to finally get it off the ground.
It’s a tough world out there…
Being a newcomer in the fashion space is not easy, as Victoria herself acknowledges. Some of the typical challenges one might face in this space are:
- You’re a newcomer and no one knows you: yes, its as simple as that. The world of high-fashion is dominated by big brands and the world is relatively closed to newcomers. A lot of the industry works on long standing relations, which take time to sow and nurture.
- Geek-allergy: creative, eccentric people are at the heart of the fashion and luxury industry. While everyone recognizes the relevance of tech, this is still a world where understanding and appreciation for ‘tech’ can vary widely and is (still) skewed negatively, even if its changing
- B2C is challenging: One needs a HUGE marketing budget in B2C. This is especially true for Fashion, since building a brand is key for success. For a B2C fashiontech startup to thrive (indeed, survive), be conscious that raising a lot of cash would be required, with a fast burn-rate in addition. Be mindful of the classic trap of friends and family praising your product – the truest test is the end-customers’ willingness to pay
- Experience, Experience, Experience: While the importance of online retail channels is clear, customers still want to touch, feel and experience your brand and its products. A high-street store or an occasional pop-store with a privileged, memorable customer experience is not a differentiator anymore, it’s a must have! Experience also starts online itself, so the more experiential the online platform, the better.
According to Samantha Soh, current President of INSEAD’s Retail, Consumer and Luxury Goods (RCLG) Club and summer intern at Bottega Veneta in Paris:
Still Ripe and Rewarding for Disruption
All said and done though, Fashion remains a relatively nascent space for tech disruption. Being one of the 1st to ‘crack’ the sweet spot between having the right blend of digital, experience and brand-equity is bound to reap rewards.
Says Stephane Nakhle, current INSEAD MBA student and summer intern at Farfetch in London:
“It is rewarding to be able to better satisfy luxury clients needs. Thanks to high level of data, we now have the capacity to offer our customers a perfectly customized experience in their purchases of luxury items. Key success criteria would be an ambitious operating system relying on strong data analytics as well as brand-building guidance.”
A big THANK YOU Victoria for your time and we wish you all the success! We also thank Samantha and Stephane for their insightful contributions.
Ladies, do visit Faber Novella to get your very own pair of unique Made-in-Italy shoes!