The future of fashion and technology: What marketers need to know
As innovation accelerates, the future of the fashion industry is becoming increasingly intertwined with technology.
According to MMGNET and The Interline’s ‘Fashion and Technology in 2025’ report, 94% of fashion professionals believe technology will be essential or quite important to the future progress of their sector. Whether it’s generative AI and VR or body scanning and 3D modelling, technological advancements are opening up a world of opportunity for brands.
With this in mind, what do fashion marketers need to know about tech as we progress through 2025? Which technologies are brands prioritising, and how do they align with consumer and market demands? Here are three key insights set to have an immediate impact on the fashion industry.
1. As brands pursue profit, tech offers a competitive advantage
Amid ongoing economic uncertainty, the most acute challenge fashion organisations believe they will face in the next 12 months is the need to secure profitability and protect margins. Out of seven strategic challenges, MMGNET’s survey participants from nearly 170 fashion brands and organisations overwhelmingly pick the need to protect profitability as their top concern.
But at the same time, consumers are demanding greater value for money. After facing an equally tough financial rollercoaster over the past few years, it’s no surprise that MMGNET’s 2024 US Consumer Outlook report saw the majority (62%) of shoppers list ‘value for money’ as the most important factor influencing their purchasing decisions, even as fashion remains in their top five categories for discretionary spending.
With the right tech, brands can reduce costs, better forecast and meet market demand, and evaluate consumer preferences at scale.
For marketers, this means a delicate balancing act is in order. Brands need strategies that not only attract and retain customers, but also balance value creation with cost efficiency to safeguard margins in what is becoming an increasingly competitive industry landscape.
Against this backdrop, technology can provide a key competitive advantage. With the right tech, brands can reduce costs, better forecast and meet market demand, and evaluate consumer preferences at scale.
UK online fashion brand Oh Polly, for example, has seen game-changing results from using artificial intelligence (AI) for personalisation on its category pages in particular. Speaking at Ecommerce Expo last September, Oh Polly product owner Lauren Muir said this tactic drove a 270% increase in clicks and 80% increase in conversion rate, according to Econsultancy.
Moreover, the ‘Fashion and Technology in 2025’ report finds 85% of fashion professionals are certain that technology will help their businesses overcome key challenges, helping them to safeguard their market position as a result.
2. Marketers are confident in their tech capabilities – but is confidence enough?
With the tools and software available changing by the day, technology can often feel like an overwhelming subject for businesses to navigate. But by and large, fashion professionals – including marketers – indicate a high level of confidence in the technology capabilities of their departments. Close to 70% rate their department as either ‘good’ or ‘industry-leading’.
In one sense, this is a positive sign for the future of the industry. As explained, tech has huge potential to help brands offer consumers better value at lower cost.
However, it also raises an important question. If every organisation places the same level of importance on technology, and so achieves a comparable level of maturity, the competitive waterline will continue to rise. Will technology therefore become a way to keep going, rather than an opportunity stand out?
Reflecting this uncertainty, MMGNET’s data suggests that even those brands with a high level of tech maturity don’t necessarily feel they are ahead of the competition.
To truly differentiate, marketers need to focus not just on implementing technology but on using it in ways that uniquely serve their brand identity and customer base. That might mean leveraging AI for hyper-personalisation, using data analytics to refine product-market fit, or integrating digital tools in ways that enhance rather than overshadow the shopping experience.
3. Around AI and AR, brand and consumer priorities diverge
Fashion brands have big ambitions when it comes to augmented reality (AR), virtual reality (VR), and in particular AI. Exploring the new horizons opened up by these three burgeoning technologies comes through as the top business opportunity industry professionals have in their sights for 2025, with the reasoning that they will become more widely accessible as the year goes on.
Already, the value of the ‘virtual fitting room’ market is projected to grow to as much as $25.11bn globally by 2032, exhibiting a CAGR of 20.3%. From Burberry to Adidas, numerous brands have launched AR tools to help consumers ‘try on’ items from the comfort of their own homes.
Meanwhile, 83% of fashion professionals believe AI in particular will add value to their business this year, and it’s a sector that’s already at the cutting edge of use cases. Valentino shot its entire 2023 Essentials menswear campaign using text-to-image AI technology, for example.
The value of the ‘virtual fitting room’ market is projected to grow to as much as $25.11bn globally by 2032.
But marketers need to be careful not to get distracted by the new and shiny. According to MMGNET’s 2024 US Consumer Outlook report, consumers care most about improvements to product quality and fit. Brands, however, rank these as much lower priorities.
This disconnect is a missed opportunity, especially in light of the strong industry drive towards improved profitability and the wider consumer demand for better value. If brands continue to prioritise emerging tech without ensuring it aligns with consumer needs, they risk investing in innovations that fail to move the needle on purchase decisions, or indeed on minimising product returns.
AI-powered personalisation and AR try-ons can enhance shopping experiences, but if they are not accompanied by tangible improvements in sizing accuracy and product quality, they may not drive long-term customer satisfaction. Bridging this gap should be a key consideration for marketers as they shape their strategies for the year ahead.
Final thoughts
For fashion marketers, embracing technology is no longer optional – but using it wisely is what matters. Tech for tech’s sake won’t cut it.
To stand out, brands must go beyond adoption and focus on impact, using technology to streamline operations, improve product quality, and enhance the shopping experience. The real competitive advantage comes from innovation that meets consumer expectations, strengthens brand identity, and drives business growth.
