Big Tech’s Threat To The Fashion Industry – Analytics India Magazine

If you are a fashionista using social media in 2021, theres a fat chance you would have come across advertisements or pictures displaying striped vests or spaghetti tops that remind you of the 2000s era, or like the internet likes to hashtag it, the Y2K trend. In fact, you might just see similar clothing items all over the internet and on fashion websites such as Shein, AliExpress or Urbanic. Big Tech has a ton to offer to the changing fashion industry with an array of products, social media platforms to market them and e-commerce platforms to sell them. It is changing the face of the fashion industry and giving birth to a new culture: fast fashion.

The fast-fashion culture is essentially really cheap clothing items, produced at a mass rate and in line with the trends changing faster than seasons. To add attractive features like short delivery times and 30-day return policies offered by these online portals are taking over the industry.

Trend Cycle

Microtrends have, as the name suggests, always been short-lived, but lately, this trend cycle has been accelerated a lot with the growing social media culture. Now these trends last up to a few weeks or months at most. The trend cycle conventionally included five stages introduction, rise, culmination, decline, and obsolescence. It has now been reduced to just three, with introduction/rise/culmination becoming one step.

A cultural aspect that is still unchanged is the human nature to jump on the bandwagon, so be it a year or a month, people will find ways to be in on the trends. And what better way than cheap clothing you can wear a few times and throw away?

Big Data: The Secret Sauce

The secret sauce behind the brands quick trendsetting is owed to optimising everything with big data. In an investigation of fast fashion website Sheins internal workings, restofworld revealed that Sheins internal software, from design to delivery to each supplier, is powered by big data. The suppliers are provided with personal accounts where the brand gives them current information about the styles in fashion, possible trends, hits, and misses so the brand can adapt and create clothing accordingly.

Big data has made it possible to conduct market research without having local knowledge. As a result, Shein has broken into vast geographies with success in Brazil, New Zealand, South Africa, France and more, owing to target specific demographic data it collects and leverages.

If a big celebrity like Kylie Jenner makes news for wearing a specific dress that most fans wouldnt be able to afford, Shein will easily find a dupe on such websites at a quarter of the price. The company leverages AI to study luxury clothing material and create the exact dupes, same as the colour, shape, and size at a speedy rate.

The reliance on big data is essential to catching on to trends better and quickly having suppliers get on to the clothes. The advantage that Shein has is that it need not create trends but catch on to the existing ones quick enough. To put this into perspective, while Zara expects the manufacturer to produce 2000 items in a month, Shein demands only 100 products in 10 days.

The amount of data collected may not be all ethical. The brand has been accused of surveillance capitalism by Tom Tugendhat, the Foreign Affairs Committee chairman. According to him, Sheins data collection network can rival many of the worlds intelligent agencies by using their mobile apps to spy on the users choices.

In fact, Sheins 5,800-word privacy policy lists tracking data points such as your searched items that directed you to Shein, the pages you view on the website, what you clicked on vs what you ordered or added to the cart, how much time you spend on each category and so on.

Additionally, an algorithm is present to showcase the latest designs on the home page and change them according to a change in the trend at an unparalleled speed. The recommendations are accompanied by discount pop-ups and sale countdowns that grab the users attention. That is not to say the algorithm is foolproof. Just last year, the algorithm pushed a necklace with a swastika charm, bringing Shein under heavy scrutiny.

Influencer culture, dupes and social media

Sheins interface presents thousands of new styles daily. This trend adds back to the influencer culture and the haul culture pushed by these platforms, especially TikTok and YouTube. The short form videos on the platforms lead to increased consumption. Hauls are the ticket to fame on such platforms, causing anyone who wants to get more views on their content, to jump on this bandwagon.

People get dressed up to post it online, contributing to the influencer culture. In fact, the fast fashion industry saw a boost in business during the lockdown, when people werent even leaving their houses and still buying tons of clothes. By 2020, Sheins sales had risen by 250 percent from the previous year, adding to $10 billion in revenue.

An effective marketing strategy by brands today is sending thousands of PR packages of the same product to influencers all around, so when they all share it online at the same time, it creates a trend. Additional frenzy is manufacturers selling the same products on various websites, from Shein to Urbanic and Romwe. Emerging technologies have given them the power to sell their products across platforms. This means you will see the same style on every other fashion platform, adding to the hype.

YouTube Video Thumbnail: Influencer Marketing

TikTok Clothing Haul

The culture of silicon valley isnt optimised on consumer choice, said Roger McNamee, partner, Elevation Partners, at BoF VOICES. Their profit comes from getting all of us to do what they want. Which is to say the same thing in their world everybody wears the same clothes in their world, everybody believes the same things because thats more efficient.

Shein leading the race

Shein, reflecting the growing e-commerce fast fashion industry, has become the most popular shopping app on both Android and iOS in the US. It was also the top iOS app in over 50 countries and the second most popular fashion website globally. In fact, the brands sales in the US in June accounted for 28 percent of the fast fashion market, close to the revenue of Zara and H&M combined. So surely, the app, and fast fashion, has a growing influence in the fashion industry.

Fast fashion thrives on speed. Shein leads the fast fashion industry as it can swifty identify trends, manufacture and ship the deliverables, all in a week. Shein has the added advantage of shipping across the globe. Ironically, the company doesnt sell in China. It rather takes advantage of Chinas trade relations with the US to import clothing to the USA. Chinese packages worth less than $800 can enter the US without added duties.

Given that Shein works directly with customers; unlike H&M or Zara, the company ships packages worth smaller amounts, not paying export taxes. The company ships to over 220 countries according to their claims. This is in comparison to H&Ms 75 countries and Zaras 100.

While Shein is leading, other companies are not far behind. Think Amazon, Alibaba and likes. After Shein was banned in India, the market was soon taken over by brands like Urbanic or Romwe.

Non-Sustainable Growth

Fast fashion is not conducive to a sustainable future or ethical growth for all its popularity. Apart from being sued by bigger brands, companies like Shein or Romwe have come under a series of controversies and scrutiny, with people wondering just how the brands are producing such cheap and quick clothing. Journalists digging into the nature of products have uncovered the work being outsourced through sweatshops that subject workers to brutal working conditions with meagerly pay and comprise of child labour.

A report by Public Eye, a Swiss advocacy group, found workers in six sites in Guangzhou to be working 75-hour weeks. Workers were clocking in three shifts a day with only one day of leave all month. The report also claimed that when Shein was informed of the non-compliance to labour laws, the company assured them they would run an investigation.

The largest consequence is the impact on the environment. Even though companies claim to use recyclable materials and quality raw materials when possible, it is impossible to make such cheap clothing without hazardous chemicals. One should also take note that the clothes are individually packed in plastic bags. Considering the tremendous amount of orders the company packs in just one day, a lot of plastic and toxins will end up in landfills.

Shein Packaging: Credits

The Other End Of The Spectrum

While big tech has encouraged and pushed fast fashion on one end, the other end of the spectrum is witnessing a revolution of fashion as we know it. The metaverse is birthing digital clothes and NFTs, making fashion as sustainable as it can be.

Granted, the digital wave of fashion is still in its infancy; it comes with a ray of hope to match up with the landfills of the fast-fashion wave.

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Big Tech's Threat To The Fashion Industry - Analytics India Magazine