Blockchain’s transformative potential hasn’t gone unnoticed. Leaders across several industries, including automotive, finance, and healthcare, are already utilizing the technology to improve their current systems. Fashion has always embraced innovative technologies, and the industry has quickly recognized the impact blockchain could have. There are already a few high-profile examples of collaborations between brands and blockchain projects, and many companies have announced they have plans in the pipeline.
Thanks to social media, brands are more visible than ever. Gone are the days of waiting for a quarterly magazine to see the latest Gucci or Chanel collections. Previously exclusive fashion week showcases are now available to anyone with an internet connection. For the last few years, it’s been possible to watch almost every notable runway show via a livestream. Brands are embracing social platforms to reach out to a new generation and have previously shown their willingness to work with the technology industry.
In the past, the fashion industry has collaborated with technology companies on various projects. Google’s partnership with French fashion house Saint Laurent, formerly YSL, produced the Cit-e backpack, a smart-rucksack controlled via a smartphone app. Other notable collaborations include Apple’s ongoing smartwatch collaboration with Hermès and the “smart handbag” by Louis Vuitton and Royole.
Research shows that millennials are twice as likely to prefer brands with social media presence than any other age group. Attracting new, younger customers is crucial for luxury retailers as a first purchase can lead to a lifetime of brand loyalty.
Statistics show that most crypto users in the USA and UK fall into the millennial age group, born between 1981-1996. So, it’s no surprise that brands are taking steps to connect with blockchain-based projects. One notable example is the Italian luxury fashion house Gucci. To mark its 100th anniversary in May 2021, a film inspired by the Aria collection was sold as an NFT at Christie’s. The sale, titled PROOF OF SOVEREIGNTY: A Curated NFT Sale by Lady PheOnix, was NFT-specific, with proceeds going to Unicef USA. Gucci has since progressed in the NFT and virtual reality sectors with the opening of the Gucci Garden and, more recently, Gucci Town.
The past couple of years have seen incredible developments in metaverse technology, and users can now freely interact in 3D worlds with the help of virtual and augmented reality.
The metaverse presents an incredible opportunity for fashion. Not only as an advertising opportunity to the growing number of users on platforms such as Dencentraland or Sandbox but as a new retail space.
In fact, according to figures from Morgan Stanley, the digital fashion industry could be worth up to $50 billion by 2030. “The Metaverse will likely take many years to develop; however, NFTs and social gaming (e.g., online games and concerts attended by people’s avatars) present two nearer-term opportunities for luxury brands,” the investment bank wrote in a note from November 2021.
Collaborations between brands and proto-metaverse games are already familiar, with Balenciaga x Fortnite, Ralph Lauren x Roblox, or Lacoste x Minecraft just to name a few. As users spend more time in the metaverse, they will use clothes to express themselves like they do in the physical world.
In a move that set the tone for the rest of the clothing industry, Nike announced the acquisition of RTFKT Studios in 2021. Sometimes mislabelled as a virtual sneaker company, RTFKT is a self-described creator-led organization. According to the official Nike announcement, the firm “leverages the latest in game engines, NFTs, blockchain authentication and augmented reality to create one-of-a-kind virtual products and experiences.” This purchase shows Nike’s dedication to metaverse fashion and its potential to become a massive industry.
Blockchain is also being applied in the supply chain, meaning that it will not only affect the retail process but the entire lifespan of an item. In fashion, supply chains can be complicated, involving manufacturers, warehouses, and transport depots, just to name a few. Blockchain can connect the entire chain from factory to shop floor, making verifying an item’s authenticity easier. This is especially important as brands move towards more sustainable, ethical processes. Storing the data on a blockchain means that the source of the materials is always transparent, allowing manufacturers to know their exact origin.
Customers will now know precisely where their garments were sourced and made. One example of this in practice is MCQ. The label, operating under Alexander McQueen, uses NFC (near field communication) chips in the clothing to store all the information about that particular item. End consumers can then access all the information, from the designer, to where the materials originated. The transparency that using blockchain allows will bring retailers and consumers closer as it increases the trust between shoppers and their favorite brands.
Considering that it hasn’t been around for a long time, the fashion industry has already made massive strides in implementing blockchain. At the forefront of the adoption, we have the metaverse, which has the potential to have its own huge fashion ecosystem. As users spend more time in the metaverse, they will want to customize their avatars to reflect their own personal style.
Beyond virtual clothing, blockchain in the supply chain could transform the garment industry forever by creating a transparent, immutable record of an item’s lifespan. This will help with the issue of counterfeiting, which is common in luxury fashion, by guaranteeing authenticity. For consumers who want to know that their clothing is sourced ethically and sustainably, a permanent record will help them verify their clothing. The possibilities are exciting for both blockchain and fashion enthusiasts, and it will be interesting to see how the relationship between the two sectors develops in the coming years.
We invite you to follow STORM partners on LinkedIn, Instagram, and Twitter to stay up-to-date on our latest developments and insights. Our LinkedIn page is a great resource for industry news and updates, while our Instagram and Twitter channels offer a more personal look at our team and the work we do. By following us on these platforms, you’ll be able to stay connected with us and stay informed about the latest happenings in the world of crypto and digital assets. We look forward to staying connected with you!