How Gen-Z is Shaping The Digital Fashion Industry

"It is time the brands listen to the voices of those born into the digital transformation age. Gen-Z can give us important insights into how we should transform the traditional fashion industry. "

Gen Z consumers will soon dominate many industries if they are not doing it already as we speak. We can observe the most significant effects in the fashion industry as expressing oneself is very important for Gen-Z and fashion is the ultimate way to do it. 

In the traditional fashion industry, every season has a theme, every year has a color and every segment has a meaning. Despite being described as “timeless”, a piece can definitely tell a lot about the time it belongs to. At least that's how it was until now. Now, brands reflect the atmosphere created by the trendsetters in their creations instead of creating trends that will guide the consumers. The limitations are also removed from the equation thank to the latest developments in technology. Today, they can be whoever they want with avatars and wear whatever they want with digital 3D clothes. The fitting of the dress, remaining stocks, and colors are not a problem anymore when it comes to digital fashion.  

Let’s take a closer look at Gen-Z and the future of digital fashion.

The consumption habits of Gen-Z

A new version of fashion is being introduced as we speak. In this new version, the limitations are removed and creativity is at the center. We can say that brands that did not ignore the wishes of a group representing 40% of global customers in 2020 (Yes, we are talking about Gen-Z) largely accepted this change.

One of the most important reasons why Gen-Z members can shape the consumption culture so sharply is that they are a conscious generation that knows what they want. They know how to use the internet and technology in the best way. For this reason, they make much more conscious choices and nurture loyalty to brands that meet their expectations. However, we can say that this loyalty hangs by a thread. According to Sitecore, 57% of Gen Z'ers are willing to move to another retailer after just one poor shopping experience. In other words, this group, which attaches great importance to first impressions, stands firm behind their expectations. When we compare it with the Y Generation, which has guided the consumption culture to date, we can say that Gen-Z is a less loyal but more value-conscious audience.

Innovative experience expectations from brands

We talked about how much Gen-Z cares about first impressions. Describing shopping as an experience rather than a transaction, the Gen-Z team emphasizes interaction. With the integration of technologies such as AR into shopping experiences, we can say that these expectations have been met to some extent. They break the chains of online shopping exactly as they want, and they want to use technology as if they were born into it. While doing this, they continue to take into account their unchangeable value judgments and sustainability criteria.

Research by McKinsey characterizes Gen Z as the “True Gen” that is searching for truth and authenticity generating greater freedom of expression and greater openness to understanding different kinds of people.

To best engage with and speak to young consumers, BoF Insights partnered with Quilt.AI — an AI-powered insights company — to canvass social media behavior and profiles to identify six personality clusters that characterize the US Gen-Z population.

This analysis, which divides the audience that makes up Gen-Z into six, actually converges on one common point. Groups, each with different core values ​​and different characteristics, have almost one single expectation: Improvement. As can be understood, Gen-Z demands brands to get rid of tradition. This expectation brings digital fashion and the value it represents to a very important point.

Digital fashion, now!

Styling wasn't the only thing we meant when we said that Gen-Z was blurring the boundaries of fashion. In a world where the fashion industry is dominated by fabrics, colors, and cuts, the technology carries the flag of revolution. The transformation of digital fashion, which is not just clothes but anything you can wear or use, demonstrates how creative data and code alone can be.

Digital fashion, which is the intersection point of personalized service and creativity, promises designers an unlimited thinking universe. In the world of digital fashion, you can find every color of your favorite jacket, a dress that changes its material constantly, and a shoe that you wear to match your avatar. Although it does not make sense for everyone to pay for virtual objects for a virtual character that does not exist in the physical world, we can say that the rise of the digital fashion industry and the investments it has received show that the number of users is expected to rise significantly soon. (And remember Gen-Alpha is also coming right after Gen-Z). In the foreseeable future, perhaps our virtual wardrobe will be more crowded than our current one. (Plus, they only take up space on the servers, who doesn’t like that?) 

What does it mean for businesses?

When you look at it from a business perspective, in this new economy, operations such as logistics and shipping are removed from the equation and the digital assets are marketed directly to the avatars. That is why we also call it the “Direct-To-Avatar (D2A) model” as well. This may sound like a retailer's dream, but now it's all too real, it’s happening. In Web2, we were buying things online for ourselves. And now with Web3, we are buying online things for our avatars. And the things we buy don’t even have to have an actual physical presence which makes it difficult to explain them to our parents sometimes.

“By 2030, Morgan Stanley estimates that the digital fashion market alone could be worth $50 billion.”

Digital fashion uses virtual characters and avatars to market digital clothing and accessories. Moreover, while digital fashion is one of the most eye-catching areas of the metaverse, it also winks at the future of ownership thanks to NFTs. NFTs are on their way to becoming the cornerstone of metaverse and metaverse marketing.

Soon we will start to buy physical goods along with their digital twins. Like when you are buying sneakers, the brand will also give you the option of buying them as an NFT so that your avatar can wear them too. Matching with your avatar will soon become an ordinary concept for customers.

Take the first step toward digital fashion

As you can see, your most important target audience, Gen-Z, wants to see how much you care about them. The young group, which has made "Show me, not tell" their motto, pursues interactive and exciting shopping experiences. While it is so difficult to gain brand loyalty from excited young people (and so easy to lose it at the same time), why don't you take the step? 

This is the future that we foresee at artlabs, every brand will have a digital 3D version of their products and they will showcase them using AR and virtual try-on. Maybe people will “buy 1 get 1 free” for their avatars soon. And it will become the gold standard for online shopping.

Contact our team today and learn about how you can enter the magical world of digital fashion.