The Next Wave in Fashion is Here: Are You Ready For Your Web3 Debut?

The fashion industry is gearing up for a major transformation with the emergence of Web3 technology. In fact, the digital fashion market is expected to be worth $195 billion by 2028. As the latest wave in fashion, Web3 promises to bring about a seismic shift in the way the industry operates and engages with consumers. With new opportunities for collaboration, creativity, and innovation, Web3 is poised to redefine the fashion landscape in exciting and unprecedented ways.

As an industry that has always been at the forefront of innovation, from Coco Chanel's revolutionary trousers to Réard's daring bikinis and Westwood's punk-inspired designs, fashion has played a key role in reflecting and shaping cultural and technological changes. Now, the industry is undergoing a transformation on multiple fronts, including the empowerment of women, the integration of artificial intelligence, the drive towards a sustainable economy, and the emergence of Web3 technology.

A new industry is driven by a new internet

The advent of Web3, also known as the "new internet," has given rise to a collaborative fashion industry where brands, artists and consumers come together to create, collect and trade in both physical and virtual realms. 

With the emergence of technologies like blockchain, augmented reality, non-fungible tokens (NFTs), generative AI and the metaverse, the industry is now moving towards a new paradigm of blending real and digital fashion experiences rather than treating them as separate entities. 

This presents exciting new opportunities to innovate and engage with consumers in unique and immersive ways. For instance, a McKinsey analysis found that fashion companies that integrate AI now could see a 118% cashflow increase by 2030 because consumers want things like hyperpersonalization and connected shopping experiences.

The convergence of Web3 technology and the fashion industry presents a wealth of unprecedented marketing opportunities for enterprises operating in this ecosystem, including exclusive digital or “phygital” collections that can be earned or purchased and even commercially traded or worn by digital avatars. 

This innovative approach has been further supported by insights from Web3 consulting agency, Moonblock, which predicts that retailers will increasingly turn to strategies such as phygitals, loyalty programs and token-gated content as part of their Web3 marketing efforts in 2022. At the same time, companies are leveraging the power of tokenization and digital marketplaces to create new revenue streams and monetize their Web3 initiatives.

Web3 technology is opening up new avenues for digital artists to collaborate with fashion brands in innovative ways. One prime example of this is the growing trend of non-fungible tokens (NFTs), which has seen leading fashion houses team up with visual artists to create unique digital collections. In addition, some artists are even venturing into the realm of virtual real estate platforms, expanding their fashion lines into new and exciting territory. London-based fashion brand Martina Spetlova, for example, recently partnered with Seamm to create a digital collection of her garments in the Decentraland metaverse, blending real-world and virtual fashion to create a brand-new experience.

This approach is creating new opportunities for collaboration and engagement between artists, fashion brands and consumers and is poised to reshape the fashion industry in exciting and unprecedented ways.

Worlds Collide: Fashion and Video Games Are Converging

One such experience is the emergence of digital fashion in video games. This is already common, with games like The Sims or Animal Crossing dropping items from Gucci, Marc Jacobs and Valentino

Snapchat’s Bitmoji avatar platform is also collaborating with major names like Carhartt, Nike and Ralph Lauren to provide digital versions of popular real-world items. In fact, Snap plans to expand this idea even further, selling digital clothing directly.

However, it’s also a huge trend in Roblox, Fortnite, Minecraft and other community-centric games. There are entire marketplaces for purchasing in-game skins so players can better express themselves. Fortnite has made billions on this alone and partnered with the likes of Balenciaga and Moncler to develop online collections, so it’s clear players are keenly interested in personalizing their digital presence.

Ultimately, we may even see a video game future where a single, totally customized avatar is able to be used across apps and games, becoming a truly unique virtual representation of each player.

Digital Fashion is here to stay 

According to Gerard Lopez, co-founder and CEO of the Lydian Group, "the mainstream adoption of the digital assets space continues to grow thanks to the blend of fashion and technology, which bridges the gap between physical and digital worlds."

Indeed, the following business and tech landmarks support the increasing investments in fashion tech:

• AR as a digital try-on feature.
• Designer fashion brands creating NFTs.
• Major retailers accepting online crypto payments. 
• Customizable gaming characters leading to new revenue streams.
• Metaverse's immersive and social shopping.  
• Digital clothing supporting sustainability by reducing waste.

Along with AI, Web3 is the next technological milestone. In fact, Vayner's report What to watch on Web3 describes how enterprises implemented avant-garde strategies over the past two years in this new digital arena. 

As expected, given its cutting-edge DNA, the fashion industry is leading this revolution.