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The fashion industry is innovating and making a big impact on today’s eCommerce. What are the new, and surprising business models that stand behind this development?

The scale of eCommerce in the fashion industry

Before 2022, worldwide revenue is expected to increase to over $765 billion. This increase is the result of the ever-growing number of consumers shopping online. Companies are introducing new eCommerce solutions and encouraging customers to try them out.

Global online fashion retail sales

6 startling business models in the fashion industry

Below, you will find brands that have brought something new to the fashion market. I wonder if their solutions will become the general standard – available in every online store. Some of the models may be surprising. But maybe in a few years, we will wonder how we lived without them.

Giving luxury products a new lease of life

Returning unwanted items and receiving points or discount vouchers for your next purchase is nothing new. H&M has already organized such an initiative with its Garment Collection Program. After the success of the campaign in 2013, the brand introduced the possibility of returning clothes permanently. In return, H&M offered a discount card for 15% off the next in-store purchase.

The Italian brand, Intimissimi, has added a similar solution to its offer. During a donation, for every five items of clothing, customers will receive a voucher or points on their loyalty card.

What if there was a luxury version of this solution?? Farfetch created a platform that allows you to donate old designer bags. In exchange, the company offers credit to fund the next purchase on their website.

Farfetch is an online luxury fashion retail platform that sells products from over 700 boutiques and brands from around the world. The company was founded in 2007 by the Portuguese entrepreneur José Neve.

The Farfetch Second Life program gives bags a second life. For returned bags, customers receive a voucher for shopping in the online store.

“Luxury fashion is increasingly geared to sustainable fashion. Resale is an area that is becoming more and more interesting to our customers. Like the online luxury market, the used luxury market is growing rapidly and is expected to double and reach over 45 billion euros over the next five years.” – Giorgio Belloli, CCO at Farfetch.

According to Farfetch CCO, Giorgio Bellolii, the luxury goods market is growing and will double in size in the coming years. Can we, therefore, expect an increase in the number of such solutions among luxury brands and thus an increase in used luxury goods?

It’s a win-win situation. Customers will get rid of unwanted products that someone else will be happy to buy for a lower price.

Watch shops are also using the sale of pre-owned luxury products. One of them is Tourneau. The company runs a certified sale of used watches with a 2-year warranty. Tourneau offers watches from such brands as Patek Philippe, Vacheron Constantin, Jaeger-LeCoultre and Rolex.

This growing trend might be worth considering.

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The subscription model for fashion

Another solution within the fashion industry is Rent the Runway. This solution has been available on the market since 2009. This year, the well-known American company Urban Outfitters decided to introduce a similar solution to its store – the Nuuly program. Rent the Runway is a service that provides designers with the rental of clothes and accessories. Similarly, Nuuly is the answer to a problem that appeared a few years ago – namely, the purchase of clothes just for a photo on Instagram, followed by their return. Nuuly allows you to rent clothes for 10% of their value. In addition, the loaned item can be bought. By purchasing a monthly subscription, UO clients will be able to use over 3,000 different outfits by the end of 2019.


Seems too niche? Well, according to a survey commissioned by the Barclaycard credit card company, almost one in ten buyers in the UK admitted that they were buying clothes only to take a photo on social media. And after sharing the ‘outfit of the day’, they returned it to the store.

Shopping via social media

One of the most exciting solutions is Instagram Checkout. That is not an entirely new solution anymore, but it is still growing, and more and more stores are choosing to implement it into their offer.

I must admit that this is a business model that will stay with us for longer. The Instagram community is increasing, and in the era of influencers, this is a practice that will benefit eCommerce.

If you do not know how it works yet, watch the video below:

If you are not ready for Instagram yet, then maybe you will be interested in the sales platform offered by Facebook. Add a store card to your website and follow the instructions on the screen. Instagram, Facebook…Which social media platform will be next? Any guesses?

The Highsnobiety business model

It is common knowledge that limited-edition offers bring benefits to retailers. A company that we worked with, Highsnobiety, built an impressive model. Luxury brands create a unique line of products for Highsnobiety.

Users subscribe to individual campaigns called drops and wait for the sales to begin. It is worth noting that users often don’t receive information about the brand of a given campaign. The campaign counter counts down, the countdown ends, and shopping begins. First come, first served!

You can read more about the Divante project with Highsnobiety here.

3D body scanning

At the end of March 2019, LVMH (Louis Vuitton Moët Hennessy) announced the finalists of the third edition of the LVMH Innovation Award. LVMH is a French multinational luxury goods conglomerate headquartered in Paris.

Source: 3dlook.me

The winner of the LVMH competition this year was the American mobile body-scanning start-up – 3D Look. The application allows you to create a three-dimensional body model based on two photos taken with a smartphone. Using the photo from the side and the front, 3D Look calculates the dimensions and shape of the body. This solution can be especially useful in the fashion industry. The application allows you to find the appropriate dress size, and perform a “virtual try-on,” that is, visualize how the item will look on the client.

In addition to measuring the entire body, it has become trendy to measure the foot to find the ideal shoe size. Nike Fit is a perfect example of foot scanning that uses AR technology; you can read more about augmented reality in the next paragraph.

In the meantime, have a look at a movie showing how it works.

If you want to be like Nike, you should think about this technology. It can be a game changer. Many startups have a foot scan in their offers: Volumental from Sweden, Wannaby from Belarus or Vyking from the U.K. Startups offering foot scan apps are springing up like mushrooms after a heavy rain.

Redefining the Fashion Industry with Augmented Reality

Last but not least, AR – augmented reality. One of the technologies that makes the biggest impression. This solution will revolutionize the fashion industry, and not only. The experiences accompanying the use of augmented reality take eCommerce to a whole new level.

AR permits you to create an entire look. Starting with virtual makeup from Sephora Virtual Artist, this app will allow you to try different cosmetics based on a frontal portrait photo.  Then, it’s time for a hairstyle with L’Oréal Professionnel Style My Hair. Check how you look with a different hairstyle or color, and if you like it, show the result to your hairdresser. It’s time for a new outfit with GAP’s virtual fitting room. Let’s see how different sizes, styles and patterns will look on your body shape. This app changes the experience of online shopping.

What else? Wanna Kicks from Wannaby and new shoes! Give the virtual “try on” a go, and choose the perfect pair of sneakers from the available 3D models.

You are ready now, but how about adding some accessories? Buy a new pair of glasses from Quay Australia. In this case, augmented reality technology allows you to try on sunglasses virtually. Put your hat on with Tenth Street, and now you are fully ready.

Now you see that more and more stores are implementing augmented reality technology for their customers. And there’s nothing strange about it, because AR will have the most substantial impact on eCommerce of all.


Do the above technological innovations have a chance to appear in online clothing stores permanently? Or is it just a temporary hype? I think we’ll find out in the years to come. And so far, we can follow new reports from the world of technological innovations with bated breath.

eCommerce Trends 2019. Download free report >

Ola Mazur

Junior Editor at Divante eCommerce Software House | LinkedIn | Twitter

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