Innovative Business Models in the Clothing Industry
Short description
In this project, I want to study innovative business models in the clothing industry. As part of The Fourth Industrial Revolution (4IR), there are indications that the current way of producing, and consuming will drastically change in the next coming decades. To respond to such changes, several companies in, for example, the clothing and fashion sector are now looking into alternative business models. The idea is to move away from mass production and consumption, towards mass personalisation. The aim of this research project is to contribute to the knowledge of innovative business models in the textile and fashion industry, by a study of companies working with personalisation of products and services.
In 2016, Klaus Schwab, founder, and Executive Chairman of the World Economic Forum, wrote:
We stand on the brink of a technological revolution that will fundamentally alter the way we live, work, and relate to one another. In its scale, scope, and complexity, the transformation will be unlike anything humankind has experienced before. We do not yet know just how it will unfold, but one thing is clear: the response to it must be integrated and comprehensive, involving all stakeholders of the global polity, from the public and private sectors to academia and civil society[1].
The transformation referred to is The Forth Industrial Revolution (4IR), which is expected to have several implications for society. The 4IR builds on the Third Industrial Revolution, where electronics and information technology were used to automate production, but takes this further, “by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres” (Schwab, 14th Jan 2016). Still, it is not to be regarded as a prolongation of the third, but rather as the mark of a new era, characterised by velocity, scope and systems impact. The speed of the changes is accelerating and has implications not the least on markets and for business. This also puts pressure on companies to adapt the new technology and reinvent the way business is made in the future.
From mass production to mass personalisation
In a research project that started in January 2023, I have started to look at the impact of the changes, to follow up on the implications of such a shift. The research project aims to identify the implications of such shift – from mass production and consumption to mass personalisation of products and services. Technology can be regarded as the enabler of the products and services to be personalised.
Personalisation of a product can be done for example through tailormade products, or certain prints and embroidery. In terms of personalisation of services, this can be done through for example designing personalised websites, and newsletters or making use of recommender systems to help customers find the right size and fit. Two companies are partners in the project: Stenströms and Trim. They are all examples of shapers of alternative business models to respond to this change. The idea they have in common is to move away from traditional ways of doing business, based on mass production and mass consumption, to a more personalised market.
In this in-depth study of the project, I want to investigate this type of new entrepreneurs (and intrapreneurs); what distinguishes them from traditional retailers, what their competitive advantage/s are, and how they organise the work within the companies. To understand the potential success of these business models, it is important to see whether there is profitability in these new business models. This will also give an indication of whether more companies can be expected to change accordingly in the near future.
By studying the companies and their characteristics more in-depth, the project will contribute novel research on current trends in retailing that can be of interest to practitioners working in the field, academics with an interest in new organisational forms, and society as a whole. The discussion on sustainability and how we are exceeding the planetary boundaries through our current ways of producing and consuming, makes the relevance of the project even more urgent, as we need to find new ways and solutions for doing business in the future. Hence, while the overall project focus on the implications of the shift, this in-depth study focus on emerging business models, entrepreneurship, and intrapreneurship.
[1] https://www.weforum.org/agenda/2016/01/the-fourth-industrial-revolution-what-it-means-and-how-to-respond/
