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Sustainability Could Push ‘Virtual Fashion’ Market to $150 Billion

While the concept of “virtual fashion” may have been a novelty at best in recent years with very few useful real-life applications, the hype behind around the concept has set the market value from anywhere from $75 billion to $150 billion, according to Karinna Nobbs, retail strategist and founder of Hot:Second, an experimental circular economy fashion popup launched last year.

The “virtual economy” has existed well before this with the rise of digital gaming and social media, and shoppers not only buying games but also downloadable content such as characters, skins and other items. In the case of fashion, virtual goods can be purchased and superimposed on a shopper’s photo for sharing online. One such case involves Norwegian denim brand Carlings, which sold digital-only items from its streetwear collection for $12 to $35. 3D motion designers add the garments to consumers’ images, which they can post and show off on social media.

In the COVID-19 era, virtual fashion now has plenty of value beyond social sharing, especially as designers and developers work from home, customers demand more sustainable clothing options and companies seek to eliminate expenses such as product sampling.

“The impact of COVID has meant that people have really expedited their experimentation of digitizing garments for potentially a showroom environment or a fashion show environment,” Nobbs said during a session in the PSFK Future of Retail digital event last week. “We are overproducing, we are overconsuming and we don’t need any more physical clothing. This year alone, we’re manufacturing 150 billion garments.”

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According to Fashion for Good, a Netherlands-based platform for sustainable fashion innovation that hosts an annual accelerator program for startups seeking to drive transparency, the production of virtual goods and the consumption of them require 90 percent fewer resources and physical garments.

Nobbs said visitors to the Hot:Second “circular economy concept store” can try on—but not purchase—digital garments in exchange for giving up an unwanted item of clothing. At two trial popups in London and Berlin, shoppers “tried on” 3D-rendered garments that were overlaid onto their images. In addition to virtual try-ons, the store also offered customization stations to upcycle old garments with patches and heat-transfer printing.

Ben Demiri, group CEO of Platforme, a made-to-order creator and designer of digital products, noted the importance of “demystifying” virtual fashion to help all supply-chain stakeholders work more creatively. His company works with clients to create 3D models and prototypes of products as well as digital pack shots to showcase all the different product permutations a retailer can offer without having to hire a real model.

“We don’t see it as a trade off,” Demiri said. “We see it as a really important add-on that will help tremendously in terms of time spent and definitely in terms of expenditure. In return, it will actually create room for creative and critical thinking to spend more time on creativity and also look at sustainability. It’s about slotting digital production and digital product creation in as part of the current process and weaving that within the current practices.”

In May, Platforme launched a new business unit, DDIGITT, a 3D strategy consultancy and a 3D product creation studio, with the mission to facilitate the creation, implementation and optimization of a 3D digital value chain for every fashion company specific to their business model.

Sergio Rossi, the Italian luxury footwear label, has sought to deliver on the 3D proposition by enabling digital customization for its “sr1” heels, sneakers and slippers, enabling shoppers to mock up shoes from the material, color and length of the heel to other categories such as plate and customized letters. Now, the company sets its sights on creating virtual showrooms for products that haven’t even been manufactured yet in order to gauge audience reaction.

“We are one of the few companies having internal production of over 1,000 shoes per day by hands,” said Riccardo Sciutto, group CEO of Sergio Rossi. “This is a capability that is unique, and when you can try to get this human capability, using innovation to get the customer is the perfect deal.”

Sciutto noted that the move to digital helped the brand become more sustainable across the board, even when it came to something as simple as designers using tablets to mock up products instead of sketching and editing on paper.

“There is no waste of leather, no waste of heel and no waste of energy,” Sciutto said. “Our factory is already 100 percent green energy, so I love this point, but I can also save that energy and be a little bit more open with the customer and let them decide what they like before also producing.”

Demiri believes leveraging all aspects of digital product creation is a smart way for brands to leverage their intellectual property to make popular goods, all while eliminating the need to acquire excess material required to create physical product samples.

“You’re talking significant reduction in time and the inversion of costs when it comes to sampling, which is one of the biggest expenses that a fashion brand could have,” Demiri said. “E-commerce deployment costs are reduced, where the cost of shipping and retouching an item is typically enormous. If you can further extend that into a virtual sale as well, that’s the ultimate holy grail.”