Our regular analysis selects one or more news stories from fashion technology, and presents The Interline‘s take on why they matter to our global brand and retail audience – as well as what they might mean for the longer-term future of fashion. As always, this analysis is also delivered to Interline Insiders by email – and signing up continues to be the best way to get a fresh look at the fashion technology news, completely free, in your inbox.
Money talks: the latest investments into fashion technology startups
Despite retail sales declining steeply, the fashion sector continues to draw in technology investment focused on both core efficiencies – recommending and selling the right products – and bold future visions for combined digital and physical channels.
The first example this week is Spatial Labs, who raised $10 million in their seed round on the 26th of January. The company is not to be confused with Spatial.io: a platform that allows for the creation of virtual avatars and spaces for the metaverse. Spatial Labs is a technology infrastructure company, creating hardware and software that allows users to buy and sell items online. Its latest product, LNQ, is a microchip blockchain-powered platform that authenticates products. Overall, the company’s mission is to converge the digital and physical worlds to transform the consumer experience.
Spatial Labs’ pitch is interesting because it combines item-level identity with both physical tracking and authentication hardware, as well as a digital backbone – bringing together real-world items and virtual experiences. No single piece of this is unique, but bringing all these moving parts together under one roof could be transformative if the vision is realised.
The consumer as well as the brand are important to Rosetta AI. The startup raised $2.2 million in its pre-A plus round, taking its total investment to date to $4.6 million. Based in Taiwan, the company specialises in e-commerce preference analysis and personalised recommendation tools geared for fashion.
According to Rosetta AI, they have seen that, by optimising unique fashion shopper preferences, it’s possible to increase average order value 2.5X. This investment provides further evidence that consumers want personalisation without intrusion; a line which is easy to cross given the amount of data that the average person shares online these days. And while Rosetta is entering a contested space, this is further testament to investors’ willingness to support fashion in the hope that more comprehensive digital transformation will be the key to overcoming any short-term decline and defining a new era of tech-enabled retail.
Privacy, personalisation and self-expression: can they co-exist?
On the other side of the spectrum is Italian fashion-tech startup Cap_able. The fashion tech startup has released a collection, named ‘Manifesto’, that claims to protect the wearer’s biometric data by fooling facial recognition cameras. The company uses a system that transposes images, called adversarial patches, onto a knitted fabric in a way that can confuse detection systems. Through the collection, creator Rachele Didero hopes to create awareness about the right to privacy and the protection of biometric data, which despite affecting millions globally, is something that is not often brought to the fore of human rights discussions.
While the clothing itself is comfortable, durable and well made (100% made in Italy, and made as part of the Better Cotton Initiative), it is unlikely that these products will become mainstream. But it does raise an interesting question about privacy, personalisation and self-expression in both physical and digital realms. The metaverse is a place where self-expression and bold identification across channels is encouraged. At the moment, most of the people occupying these online spaces are themselves (as in, they use the same names in the physical world) and they are therefore aiming for high visibility that transcends both their personal and online lives.
But it is possible that many will not want to have their digital identity correspond with their real world one: for purposes of privacy and perhaps unfettered creativity. To consider: as the metaverse expands and connects, how separate will our lives online and offline become? And what role will fashion have to play in both extremes of self-expression and anonymity?
Digital collectibles: accessibility and appeal
Earlier this week, Tiffany & Co and Nike announced their collaboration on a fresh take on the Air Force 1 1837 sneakers. The drop on the 7th of March is expected to sell out within minutes, with a pair to retail for $400 on the primary market. So far there has not been any chatter about any kind of digital collectible as part of the collection, and if it were, we can only speculate whether it would be as popular. Given the success of previous such endeavours, it would be fair to assume that it would – especially since The Interline has previously cited Nike’s ongoing commitment to digital collectibles as being an example of a bold vision being put into practice.
If we follow that hypothetical, this particular collaboration would be a good fit for a combined digital and physical legacy. It is different from the limited-edition Louis Vuitton Air Force 1s, which were tied to Virgil Abloh’s legacy. This time it’s light, elegant, and indicative of the moment. The price point is also not completely out of reach at $400 – vastly less than that of Louis Vuitton’s at $2,750.
But while the price of the physical sneakers is interesting, the potential cost of a digital collectible could be more category-defining. As inflation soars and costs eat into brand margins, it may be the best marketing strategy to promote products that are less expensive and thus more accessible to the bargain-hunting customer. And digital counterparts to physical products could offer a lower-cost entrypoint for consumers who buy into the shared-brand vision, but for whom the retail price is prohibitive.
This is speculation on The Interline’s part. It’s equally likely that brands will see digital collectibles as just as scarce and therefore just as valuable as their physical counterparts. But against the current economic backdrop, there would seem to be an opportunity for brands to use digital assets to give new customers a way into their brand universe – even if the price of those assets skyrockets later when it becomes determined by the open market the same way limited edition physical sneakers are today.
Live event update:
The Interline will be helping to educate new audiences on the potential of technology at two leading fashion industry events in February, in Europe and in North America.
Next week we’ll be hosting the first-ever dedicated series of technology-focused panel discussions at Première Vision Paris, all packed into a single afternoon. Learn more about why technology is becoming a more prominent part of Première Vision’s content programme and its ambition to bring together the core business of fashion and new frontiers of innovation by reading our interview with COO Igor Bonnet.
A little later in February we will be returning to SOURCING at MAGIC is Las Vegas, for a multi-day series of panel discussions, presentations, and technology conversations – all woven into the fabric of North America’s milestone industry event. Discover why The Interline and the team behind SOURCING at MAGIC believe technology will be essential to future-proofing the fashion industry this year and beyond by reading our 2023 look-forward.
The best from The Interline:
This week we published two further instalments in our series of digital product creation executive interviews, as well as an exclusive feature written by the founders of leading digital fashion company DRESSX – all extracted from our industry-defining DPC Report.
In their feature, DRESSX make the case for the sustainability of digital fashion – arguing that if even a small portion of consumer spending is diverted from physical goods (which are often worn just once, for social media) and into digital-only products, the industry would see a net reduction in overproduction and its attendant environmental harm.
In the first of this week’s DPC conversations, we talk to Jim Downing, CEO of Metail, about how fashion can look at bringing together digital garments and real models at speed and at scale.
Our second DPC interview is with Aurélien Vaysset, Co-Founder and CEO of Emersya, and it explores how solutions for centralising, managing, and delivering digital assets will help power the future of consumer interaction.