The fashion industry, particularly luxury brands, was notoriously slow to adapt to the explosive growth of e-commerce and online shopping. However, with the advent of web3, they may be ahead of the competition. However, what is web3? Web3 refers to a decentralised online ecosystem built on the blockchain at its most fundamental level. The platforms and applications developed on web3 are not controlled by a centralised gatekeeper such as Google. Instead, users earn their ownership share by contributing to the development and maintenance of these services. Consequently, the decentralised web3 framework provides brands with direct monetisation options and management over their content. Today, it is not uncommon for luxury labels to use web3 to produce non-fungible tokens (NFTs) of their particular luxury apparel. There are NFTs for clothing, hoodies, and baseball hats, among other things. And with the advent of the metaverse and the rise of artificial intelligence (AI), machine learning, and the internet of things (IoT), luxury companies have the opportunity to reach a worldwide audience. Brands can now engage with the audience through a web portal that is as realistic as it gets in the metaverse.
But what’s the fuss about?
Metaverse, NFTs and the Intersection of Luxury Brands
Nowadays, luxury brands are embracing the NFT market. Moreover, the convergence of high fashion with blockchain has initiated a fashion industry revolution. The web3-fashion duo consists of tangible assets, such as retail apparel and other accessories, and their digital counterparts as NFTs or digital tokens. Auroboros, which advertises itself as « the first fashion house to mix science and technology with physical couture, » debuted a collection of digital garments that can be worn via augmented reality (AR) during London Fashion Week in March 2022 and hosted virtual fashion shows during the event. Meanwhile, Miami Fashion Week pushed it to the next level by hosting virtual events in the metaverse from 31 May to 5 June. During the event, attendees could purchase virtual products, while designers, models, stylists, and photographers had to access L’Atelier, a new fashion club for NFT members. Fashion businesses have been early adopters of Web3 technologies. They are using web3 to get a deeper insight into consumer behaviour to more precisely and aggressively map user experience and engage with specific customer segments. These initiatives contribute to developing companies’ brand identity while bolstering growth prospects and spawning new product lines.
How will Web3 give Rise to New Categories of Products?
With the introduction of every technology come new products and services, and web3 proliferation is no exception. As brand awareness increases and web3 becomes mainstream, several new product categories will develop to level the playing field. Let’s review some existing types, but many more may soon develop.
Numerous fashion brands are developing their Web3 offerings, often collaborating with recognised artists and virtual asset marketplaces. These virtual assets consist of non-fungible tokens (NFTs), digital avatars, virtual goods, etc. Brands maintain complete control over the support they develop, including how they appear and function in virtual worlds and digital wallets. These initiatives capture the interest of younger audiences and provide valuable insights into their behaviour. Moreover, digital assets are less expensive to generate than physical goods. As a result, they may be used to correctly assess the appeal of a product’s aesthetic or design and marketers can then transform the most popular virtual objects into real ones.
Adding a digital perspective to real-world items is the second-way fashion brands use Web3. By producing a digital clone of the goods in NFTs or digital tokens, the physical item becomes a digital collectable due to its authenticity and uniqueness. For example, the premium fashion brand Coach released an NFT line for the 2021 Christmas season, providing customers with an exclusive bag that was not otherwise accessible. Several premium and high-end firms are employing web3 to reach deeper, retain more consumer data, and create new products leveraging the technological edge.
How are Luxury Brands Using Web3?
Luxury brands are elegantly exploring and finding their way in the metaverse. Here is how some top brands are using web3 to their advantage:
Gucci teamed up with NFT project 10KTF in March 2022 for its most recent metaverse partnership. The concept contained a virtual floating city titled « New Tokyo, » fashion accessories in the form of NFTs, and a mythical figure named Wagmi-San. Gucci has dabbled with NFTs elegantly so far and is poised to lead the way in the future.
Prada made its foray into the NFT industry this year by releasing a crowd-sourced NFT alongside Adidas. Following the success of its first joint NFT release, Prada re-entered the burgeoning NFT market in June 2022 with the release of its first-ever Timecapsule NFT collection. The Timecapsule drop wanted to provide a complimentary NFT with Prada’s physical product, an emerging trend in the premium market.
Dolce & Gabbana
Dolce & Gabbana sold their first nine-piece collection of NFTs, named « Collezione Genesi », combining high fashion with blockchain, for $5.6 million in October 2021. The bundle comprised both tangible products and digital merchandise as NFTs.
The Road Ahead for Fashion Brands
Words cannot sufficiently explain the effect of Web 3.0 on brands and independent fashion designers. However, the fact that NFTs in a Web 3.0 metaverse can enable users to engross themselves in the aesthetic culture embraced by the fashion industry is unquestionably deserving of attention. In addition, all of this is accomplished while buyers experience full ownership of the fashion and luxury products they purchase. Thanks to NFTs, fashion designers will be able to showcase clothing in a metaverse that can be purchased or exchanged on a decentralised virtual marketplace. Counterfeit fashion goods will no longer be a problem because NFTs are unique and verifiable on the blockchain, as every digital wearable item will be verifiable. It is a matter of time until brands and independent designers have more exposure to monetisation options and product control.
« Given the benefits that NFTs and a Web 3.0 metaverse will give fashion labels, firms in the fashion sector must start preparing or potentially lose their technological edge when the virtual world becomes a reality. »