Ongoing Changes in

the Fashion Sector

2023
www.scayle.com

↗ 8 Big
Challenges of
the Fashion
Industry in 2023
Obstacles to face and opportunities
to keep up with the ongoing changes
in the fashion sector

Your eCommerce Platform Sustainable Fashion Is in The Need for Social Encouraging Loyalty
Must Provide a Cutting-Edge Demand – and Required Commerce and Live Shopping With Memberships and
User Experience Is Growing Gamification

Page 07 Page 11 Page 14 Page 19

Start Ongoing Changes in

↗
2023
the Fashion Sector

Content
TL;DR Page 03

Introduction Page 05

Page 06

↗ 8 Challenges for the Fashion Industry in

2023 and How to Overcome Them
Page 07

↗ Challenge #1:

User Experience
Page 11

↗ Challenge #2:

Sustainability
Page 14

↗ Challenge #3:

Social Commerce & Live Shopping

Page 19

↗ Challenge #4:

Memberships & Gamification

Page 22

↗ Challenge #5:

Metaverse & NFTs

Page 25

↗ Challenge #6:

Global Supply Chains

Page 28

↗ Challenge #7:

Seamless Omnichannel
Page 31

↗ Challenge #8:

Efficiency
Page 35

↗ Find Your Own Unique Strategy to Drive

Your Business Forward in 2023
 TL;DR
TL;DR
Change in the fashion industry has been fast
and furious in the past few years. Brands
that lack the right technical foundation will
struggle to keep up. In this article, we’ll give
you expert insight and tips for dealing with
eight challenges your brand will face in the
fashion industry in 2023. We’ll also show you
how to turn the challenges into opportunities
for growth.
Providing Cutting-Edge User
Experiences
While digital marketplaces will consolidate
the fashion market in the next few years,
brands will have to choose between
competing with large platforms or using
them to their advantage. Opting for a flexible
commerce technology that ensures customer
convenience is the foundation for providing
an excellent shopping experience on all
channels and enabling brands to differentiate
themselves in a fast-changing market.
Sustainability Is in Demand
Consumers are increasingly aware of the
environmental impact their purchases are
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
having. Legislators are even one step ahead
with the EU implementing mandatory
sustainability schemes for textiles. Thus,
brands will need to find smart solutions
to educate consumers with consistent,
transparent product information and adjust
their shop technology to make this data
readily available across all touchpoints.
Social Commerce Is Growing
Social commerce and live shopping are not
only big in China but also gaining traction
in other parts of the world. In particular,
millennials and Gen Z are favoring new,
engaging ways to shop on social media.
Therefore, leveraging live shopping is a
great opportunity for brands to connect with
younger audiences. But make sure all your
communication is authentic.
Membership Programs
Increase Loyalty
Digital natives are getting accustomed to
supporting their favorite content creators on
3
 TL;DR Ongoing Changes in
the Fashion Sector
2023

TikTok, Twitch, or Patreon with memberships Connecting Offline With

or for special incentives. Thus, they pave the Online
way for brands to create new ways of bonding
A seamless omnichannel experience can
with their loyal fans. Early access to limited
boost your business immensely as you don’t
editions, faster shipping, or event invitations
necessarily have to create anything new. For
could be among the benefits brands can offer
instance, by conveniently providing access
to keep the attention of their audience.
to all your online and offline stocks, you
can create a customer-centric experience
and empower your employees to sell more.
Evaluating the Metaverse and
NFTs
Even though the hype around the metaverse Driving Efficiency With
has slowed down, tech-savvy fashionistas Modern Tech
will still more than appreciate innovative ways
Get out of your comfort zone and finally
to express themselves with creative assets.
address your biggest pain points that keep
Brands like Nike, Gucci, Ralph Lauren, and
you from growing your business effectively.
Adidas are already testing out the stunning
Evaluate your tech stack: Does it still reflect
potential of metaverse events, spaces, or
what you need in 2023 and henceforth?
NFTs.
Increase your flexibility with an API-first
approach, lean processes, and focus on
what adds to your value proposition.
Mastering Global Supply
Chains
In the past years, we’ve all seen the devas-

Do we have your
tating effects current events can have on
global supply chains. So one of the biggest
challenges of 2023 will be for brands to attention now?
figure out how they can create more resil-
Read on and find out all the challenges
ient supply chains and communicate
and obstacles of this year's fashion
respective shortages and delays transpar-
industry and how to overcome them
ently to consumers.
successfully.

8 Big Challenges of the Fashion Industry in 2023 4

 Introduction
Introduction
The fashion industry was hit hard by the
pandemic. Yet, while it has already started
to recover, it is confronted once again by
ongoing global challenges: the war in Ukraine,
high inflation, the energy crisis… Among the
biggest concerns of the industry are supply
chain reliability, sustainability efforts but also
building more efficient processes.
On top of that, the industry is moving towards
D2C eCommerce while the world of digital
marketing is rapidly changing. Brands are
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
under pressure to keep pace. Fashion has
entered the metaverse, and shoppers expect
seamless brand experiences with utmost
convenience. Therefore, companies need to
stay current to avoid losing market share.
This white paper will discuss some of the
most pressing challenges that fashion
retailers face in 2023 and provide actionable
solutions. We’ll also look at the hidden
opportunities these challenges can offer.
5
 8 Challenges for the Fashion Industry Ongoing Changes in
2023
in 2023 and How to Overcome Them the Fashion Sector

8 Challenges for
the Fashion Industry
in 2023
and How to Overcome Them

The last few years have been full of upheaval, and experts expect the fashion industry
to be challenged yet again in 2023.

√ Get to know the foundation of technology-driven customer experiences.

√ Learn how to react to the demand for sustainable fashion.
√ Read why you should leverage social commerce.
√ Discover how to increase brand loyalty with memberships and gamification.
√ Figure out why you should use the metaverse and NFTs to boost your brand.
√ Learn how to maintain stable global supply chains.
√ Read how to offer seamless omnichannel commerce.
√ Learn how to boost efficiencies with intuitive processes and automation.

Not sure how to reach your goals? This white paper will include actionable suggestions
on each topic and show you how to turn these challenges into valuable opportunities.

8 Big Challenges of the Fashion Industry in 2023 6

 01 User Experience
Your eCommerce
Platform Must
Provide a Cutting-
Edge User Experience
Challenge #1
According to a recent McKinsey report, com-
panies need to “put digitally driven commerce
at the center of their organizations, so they can
Challenges
In the next few years, digital market-
places like Amazon, Zalando, ASOS, or
ABOUT YOU are expected to take an
ever-greater market share and consol-
idate the market. They will even more
dominantly set tomorrow’s commerce
standards in terms of buying conve-
nience – enabled by modern technology.
To keep up, brands need to grow
their visibility and offer customers the
convenience they’ve come to expect.
Large product assortments, fast ship-
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
orchestrate experiences that meet customers’
ever-rising expectations.” Those who fail to do
so risk missing the next eCommerce wave.
ping, a localized customer experience,
and transparent communication are
no longer unique selling points. They
are the bare minimum: hygiene factors.
At the same time, brands need to invest
wisely in what differentiates them from
competitors. Being on par with platforms
and competitors is good – but it won’t
remind customers why they love your
brand. You can lose customers when you
don’t provide the payment method they
7
 01 User Experience Ongoing Changes in
the Fashion Sector
2023

expect; you won’t convince them adapting your user experience on

to buy, though, just because you do all channels will be key to keeping pace.
offer it. Staying flexible and continuously

Solutions
A modern, flexible eCommerce platform
can do the heavy lifting for you, un-
locking new standards by default and
freeing up your resources, so you can
focus on differentiating your brand.
Look for headless, composable soft-
ware architecture with flexible API
extensions, which will let you adapt
quickly to changes and offer seamless
omnichannel commerce. Scalability
is also essential. After all: You want to
grow freely with your business goals and
not be held back by performance issues.
Furthermore, pay attention to creating
unique front ends that will differentiate
your brand from competitors, e.g., with
compelling product discovery routes,
configurators, personalized recom-
mendations, and more. And don’t forget
to set up your tech stack accordingly.

“It’s tempting to think that you can only provide unique

experiences if you build everything from scratch. In fact,
there’s no need to reinvent the wheel – unless you have
a special case that requires a granular solution. Take
advantage of best practices that are already available and
use them for a jump start to scale your growth. Ensure
your hygiene factors are taken care of while you focus on
building what differentiates your brand.”

Tobias Ring
Director Growth Services
SCAYLE

8 Big Challenges of the Fashion Industry in 2023 8

 01 User Experience Ongoing Changes in
the Fashion Sector
2023

Myth has it that brands need to compete with large platforms. But what if they could reverse
the odds? A balanced, multi-pronged D2C strategy will help brands not only to be on par with
platforms with regard to convenience but leverage them to their advantage.

Opportunities
Marketplaces
The first big opportunity for you is to
leverage your marketplace business.
We expect brands to adopt a refined
hybrid distribution model for out-
bound marketplaces with a mix of
dropshipping, wholesale, and platform-
specific fulfillment options. This way,
brands gain more control of their overall
visibility, increase interest in their products,
and extend their reach.

Tip:
Make sure you don’t depend too
much on the wholesale buying
strategy of marketplaces that will
Wholesale Dropship- Platform-
ping specific change substantially depending on
current macroeconomic conditions.
To stay relevant on marketplaces,
you need to be present. Therefore,
you should gain control of your
assortment and extend it if needed –
no matter where you sell.

Outbound marketplace

8 Big Challenges of the Fashion Industry in 2023 9

 01 User Experience Ongoing Changes in
the Fashion Sector
2023

Another often overlooked opportunity for thousands of merchants. It’s essential to

brands is to extend the assortment of their remember what the target audience is
own shop by becoming a marketplace. looking for and flexibly enhance its shop-
Not every brand needs to become a large ping experience by offering more.
marketplace like Amazon, though, with

Tip:
Extending your assortment without the extra costs
is a great way to keep your customers strolling in
your shop and increase the benefits of a carefully
curated marketplace. Unlike the big players on the
market, your brand can score with an assortment
targeted to your customers. You know best
what your customers want. Find those merchants
with the right fit for your brand that will uplift
your assortment. Don’t just randomly extend your
product range just because you can.
Inbound marketplace

“When becoming a marketplace, your

assortment is one of your biggest
assets. Remember that when onboarding
vendors. It’s essential to enforce
your quality standards and create the
right fit for your brand. Implementing
a selective marketplace strategy is
great for boosting your opportunities
to acquire new customers with a bigger
assortment while cutting costs.”

Tobias Ring
Director Growth Services
SCAYLE

8 Big Challenges of the Fashion Industry in 2023 10

 02 Sustainability
Sustainable Fashion
Is in Demand – and
Required
Challenge #2
Some fashion brands have already begun to
integrate sustainability into their brand
strategies in recent years in order to reduce
waste and develop circularity concepts.
Now, public and regulatory pressure is notice-
ably increasing those efforts. For instance, the
EU is implementing mandatory sustainability
schemes for textiles. Furthermore, consumers’
awareness of the environmental impact their
fashion purchases have, is also growing at the
same time. Both second-hand clothing and
sustainably-made fashion are in high demand.
Brands have responded by opening second-
hand marketplaces for their products and
launching more sustainable collections, such
as the Gucci Off The Grid collection.
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
But there’s another side to sustainability
many brands tend to neglect: proving claims
and avoiding greenwashing allegations. As
regulators will take a particularly close look
at vague claims like “green”, “eco-friendly”,
or “good for the environment”, brands will
have to extend their product information data
and make them consistently, transparently,
and traceably accessible. Only when put
into context will consumers be able to make
informed decisions. Also: This data must be
easily shareable with regulatory agencies.
Thus, brands need to make sure their product
information system (PIM) can adapt flexibly
to new data requirements and implement
them consistently across the whole system.
11
 02 Sustainability Ongoing Changes in
the Fashion Sector
2023

Solutions
Brands will have to invest in enhancing
their data quality and making respective
product information accessible through
all touchpoints. Therefore, they should
implement a consistent, unified system
for recording product data information,
including sourcing, recycling, packaging,
and fulfillment details. Transparent,
traceable information is key to providing
credible support for all sustainability
efforts. Educating consumers with
verified information in the front end,
e.g., material composition, sustainability
certifications, factories, and anything
else available, will help brands to prove
their claims.

Increase data quality

guidelines

Adjust product data

schemes in PIM

Refine all product data

(e.g., material)

Display in
front ends

Customer can scan product

information in store

8 Big Challenges of the Fashion Industry in 2023 12

 02 Sustainability
Opportunities
Transparency
There is a hidden opportunity here.
Eco-conscious consumers want
proof that their purchase is genuinely
sustainable. Brands will win consumer
trust and strengthen their reputation
as responsible industry leaders by
elevating their quality guidelines for
product data information and applying
them consistently across all channels.
Tip:
Make sure your shop technology
enables you to adjust your product
information flexibly, regardless of
the product itself and where it’s
sold. Attribute-based data structures
may help you to set up versatile
data schemes that work for all kinds
of different product families. Be
consistent. Include certificates. And
provide additional insights into your
processes and values. That will
help you to build loyalty and trust in
your brand.
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
This way, consumers will be able to
conveniently access not only all required
product information “on the go” but also
the relevant context. So consider linking
certificates or product data in the front
end with sustainability landing pages
explaining the background of
your efforts.
“Convenience is key to
offering transparent access
to relevant sustainability
data. After establishing
uniform guidelines and
implementing them at the
core of your commerce
solution, share this
information with your
customers readily: in your
online shop, your mobile
app, by offering in-store
scans, or even complete
digital product passports.”
Tobias Ring
Director Growth Services
SCAYLE
13
 03 Social Commerce & Live Shopping
The Need for Social
Commerce and Live
Shopping Is Growing
Challenge #3
Social commerce lets consumers purchase
products directly within apps, like Facebook,
Instagram, Pinterest, or TikTok. One promising
type of social commerce is live shopping:
interactive, shoppable live streams by brands
or influencers either on social media or a
brand’s website or mobile app.
The results can be astounding. In China, the
total revenue from eCom live streaming is
projected to grow to US$720 billion in 2023.
Social commerce is already in vogue in China,
with more than 60% of Chinese consumers
buying fashion via live stream. And even if it’s
still uncertain whether Chinese consumers
Challenges
Social commerce can be really easy
and really hard at the same time. It is
essential to know your target group to
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
are a benchmark for the rest of the world,
social commerce is also gaining traction in-
ternationally. It’s a trend among millennials
and Gen Z, many of whom use TikTok as their
go-to search engine. Analysts predict that
live commerce could account for 10 to 20%
of all eCommerce sales by 2026.
Even though Facebook and Instagram are still
strong channels for social commerce, TikTok
might take the lead for live-stream commerce
in 2023 after partnering with TalkShopLive
and even planning to build its own fulfillment
centers in the US.
decide which social media platform
is best suited for your brand. If you
collaborate with influencers, it’s vital to
14
 03 Social Commerce & Live Shopping
set up a dedicated influencer marketing
strategy, including determining your
target audience, which influencers to
book, and which KPIs to measure.
Finding a perfect match for your brand
can be challenging, but all the time you
spend on preparing every little detail will
Solutions
Different social media channels are
popular with different age groups,
so consider where your target group
spends its time. To attract the younger
generation, you need to be on TikTok,
Twitch, or Snapchat. If you sell
internationally, remember that the most
popular social media networks in
other countries are sometimes barely
known among consumers in the rest
of the world, take WeChat or KakaoTalk,
for instance.
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
save you time later on and increase
your chances of succeeding in growing
with social commerce. Also, ensure
you can quickly implement whatever
social commerce or live shopping
tool you opt for into your technical
commerce ecosystem.
When offering live shows, do so
frequently and be sure to focus on
real-time interactions to keep viewers
engaged and boost retention. Provide
expert advice and product insights,
and inspire your audience with new
looks that they can combine with other
products. Allow your viewers to click
products within the stream without
having to leave it. They can scroll through
product detail pages or the whole live
show assortment while following the
rest of the show – and perhaps discover
even more products they like.
15
 03 Social Commerce & Live Shopping
Opportunities
Live Shopping
Live shopping can be great for retailers
with a more extensive assortment as
they can continually engage customers
with new product line-ups and col-
laborations. Brands with a smaller
assortment can benefit most from live
shopping by offering exclusive
(influencer) editions. Or they focus on
providing detailed product information
“straight from the designers,” sharing
their expertise, and answering customer
questions during the live show. It’s
always good to set up shows with a host
who can serve as the product expert
and perhaps also invite social media
influencers who are equally valuable for
a compelling show.
When choosing influencers to work with,
brands should look for influencers with
a high engagement rate. Authenticity
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
builds trust. So live streams in a home
setting can be just as effective as filming
in a studio. Many influencers already have
everything they need for a live stream,
and their followers are used to the familiar
setting. They can shop from their favorite
creator without any disruptions.
But remember: You also need to smoothly
integrate your live shopping tool into
your commerce ecosystem for a reliable
experience. Unless the infrastructure
enables growth for all connected tools,
you’re most likely up for performance
issues, are limited in setting up your buying
experience, or might miss out on aligning
your live shopping with the rest of
your marketing activities. A modern,
growth-enabled API-first solution will be
a good starting point to integrate your
favorite tools.
16
 03 Social Commerce & Live Shopping
Tip:
When planning your live shopping
schedule, try different formats to make
your shows as compelling as possible.
Book influencers and let them run the
show. They know their followers best.
Instead of defining all the details for
them, decide on a particular motto, e.g.,
wedding season, and have them pick
products they would like to present.
Another type of live shopping show
that usually converts well is offering
exclusive assortments. These shows
are hosted by the designer or another
expert, who can not only inspire viewers
with new styles but also give detailed
insights into how the products were
developed and what makes them so
special. People like to be engaged. So
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
allow your viewers to post comments
and ask questions and respond to them
directly within the live show. That will
uplift your conversion.
Retailers can also produce different
kinds of brand shows. Inviting a brand
host will create more interest in the
brand’s products and help connect with
the live audience. A brand expert can,
for instance, explain brand values and
answer questions about fabrics, the
latest trends in the market, or where
products were produced.
Also: Don’t forget to record your shows
so viewers can watch them at a later
time if they miss the live show.
17
 03 Social Commerce & Live Shopping Ongoing Changes in
the Fashion Sector
2023

“Being authentic will make or break your live shopping experience.

You don’t necessarily need the biggest influencers to get a foot
in the door. Stick to local influencers with a good engagement
rate and a high brand fit. Increase engagement and viewing time
with real-time interactions like expert advice and rare product
insights.”

Tobias Ring
Director Growth Services
SCAYLE

8 Big Challenges of the Fashion Industry in 2023 18

 04 Memberships & Gamification
Encouraging Loyalty
With Memberships and
Gamification
Challenge #4
With faster innovation circles and consumers
being increasingly influenced by diversified
channels, it’s important for brands to not just
follow along but to proactively engage their
customers. Building even stronger bonds will
have to become a priority as other players in
the market move ahead quicker than ever.
Memberships and gamification can help
create that loyalty bond. Online communities
Challenges
To implement a membership system
or gamification, you’ll need a flexible
tech stack that lets you quickly add
new tools. Also, you’ll want to be a first-
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
thrive, with millennials and Gen Z getting
accustomed to supporting their favorite
content creators with member-only benefits
on platforms like Twitch or Patreon. It’s a
logical step for brands to take advantage of
this trend. Chinese online retailer Alibaba has
already had great success with membership
models. Brands should consider building a
sense of community and incentivizing repeat
purchases.
mover since consumers are constantly
exposed to new channels and “learning”
new shopping behaviors. Don’t get left
behind!
19
 04 Memberships & Gamification
Solutions
Make sure your tech stack is up to
the task: a modern API-first, headless
eCommerce platform will give you the
required flexibility. Take inspiration from
learning apps that use gamification
to increase retention. You might offer
daily deals or have special offers that
Opportunities
Memberships
Membership programs can form the
basis for many marketing tactics.
Brands can create a fear of missing out
by offering member-only products or
specials or ensuring repeat purchases
by making membership programs a
subscription service. Customers could
automatically receive a voucher – or
even a box of products – every month at
a discounted price. The brand Fabletics
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
unlock at a specific purchase status.
Some brands have been using low-key
incentives for years, but with the right
omnichannel technology, you can take
it a step further by offering, e.g., digital
loyalty stamps that can be used in-store
or online.
has precisely done that with its VIP
program. All these strategies will also
increase customer interactions, which
is a boon for marketing as it allows
brands to gather more customer data.
20
 04 Memberships & Gamification Ongoing Changes in
the Fashion Sector
2023

Tip:
When defining your membership program, consider your customers' daily pains and try
to integrate them into your program. Do you ship globally? Offer express delivery and
take care of customs. Do you offer limited editions? Give your loyal customers early
access so they won’t miss out on your latest drops. Are you planning in-store events?
Send your VIPs premium tickets with little goodies. You can also let your customers
unlock benefits after spending a certain amount in your shop. They could collect
fashionista badges or compete with friends or partners for group discounts. Excite your
customers with great products, great experiences, and make them feel at home with
membership programs to boost their loyalty. Show your customers they are not just a
number but a valuable part of your community – because they are.

“Younger audiences are already

accustomed to supporting their
favorite creators on TikTok,
Twitch, or Patreon. And as more
and more influencers are selling
their own product lines, the gap
between them and brands is getting
smaller. That’s where memberships
come into play. Target them to the
needs of your audience and use them
as an opportunity to build your
community.”

Tobias Ring
Director Growth Services
SCAYLE

8 Big Challenges of the Fashion Industry in 2023 21

 05 Metaverse & NFTs
Entering the Metaverse
and Leveraging NFTs
Challenge #5
Consumers spend more time online and
explore new things – brands should do the
same. And many high-end brands already are.
They are entering the metaverse, virtual online
worlds where people can play games and
Challenges
Brands like Nike, Gucci, Ralph Lauren,
Adidas, and more are creating virtual
events, spaces, and clothing for their
fans on platforms like Roblox or The
Sandbox. However, the metaverse
hype has been slowing down. Not all
metaverse platforms are as highly
trafficked as they were in 2020/2021.
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
interact with each other using avatars. With
virtual events and NFT fashion, they are taking
“omnichannel” to a whole new level. Gucci,
for example, created virtual avatar items for
Pokémon GO players.
While digital fashion has an incredible
potential ROI, getting started in this
new world requires investing in strategy
and digital art design. And this trend
isn’t right for every brand, so you should
carefully consider whether the concept
fits your audience.
22
 05 Metaverse & NFTs Ongoing Changes in
the Fashion Sector
2023

Solutions
Do your research and ensure that you
choose a platform with a large, active
user base. Visit some in-world events
and make sure they offer a good
experience. Before you jump on this
trend, consider your brand’s positioning.
If you target tech-savvy trendsetters
who want to express themselves
online, you could be a good fit for the
metaverse.

Opportunities
NFTs
The intersection of NFTs, gaming, and
virtual fashion offers exciting
opportunities for high-growth brands. By
joining consumers in their virtual worlds,
you can expand your advertising reach
with in-world events or locations, build
brand engagement by letting customers
interact with your brand in a fresh,
creative way, and create new revenue
streams with NFTs.

Tip:
NFT fashion also gives your brand a chance to show its creative side. Virtual fashion
can be and do anything you want – there are no physical laws or concerns about
comfort. You can even use NFTs linked to physical products to prevent counterfeiting
in the real world. Because all NFT sales are recorded on the blockchain, a product’s
history can be traced back to the original sale to ensure authenticity.

8 Big Challenges of the Fashion Industry in 2023 23

 05 Metaverse & NFTs Ongoing Changes in
the Fashion Sector
2023

“Never underestimate people’s desire to differentiate

themselves. There are reasons avatars are still around and
filters are so successful. People want to express their
personalities. And digital worlds are perfect for it.”

Tobias Ring
Director Growth Services
SCAYLE

8 Big Challenges of the Fashion Industry in 2023 24

 06 Global Supply Chains Ongoing Changes in
the Fashion Sector
2023

Logistics Depends on
Global Supply Chains
Challenge #6

Logistics has been one of the biggest like Brexit, the pandemic, or accidents like
challenges for fashion brands recently. the Suez Canal closure can wreak havoc on
Brands rely on a functioning global supply supply chain logistics.
chain. We’ve all seen how quickly events

Challenges
McKinsey reports that skyrocketing
freight costs and various shortages
create logistic problems for brands
everywhere. Product shortages can
affect customer loyalty. Therefore,
brands need to make their supply chains
more resilient.

Solutions
To become more resilient, brands should reduce dependency on freight carriers and
develop logistics contingency plans. Local sourcing could be one way to do this.
You could also consider using a hybrid system of various warehousing and shipping
strategies.

√ Cross-border shipping: Orders are delivered to the destination country directly

and have to go through customs individually.

8 Big Challenges of the Fashion Industry in 2023 25

 06 Global Supply Chains Ongoing Changes in
the Fashion Sector
2023

√ Direct injection: Individual orders are packed and bundled in their country
of origin and shipped to the distribution hub in the destination country. Each
shipment clears customs individually and is delivered to the customer with
local delivery services.
√ Cross-border fulfillment: Products are stored in the destination country or
region you’re shipping to.
√ Nearshoring/reshoring: Outsourcing part of your operation to a nearby
country (nearshoring) or bringing your manufacturing back to your home
country (reshoring) to reduce the need for transportation.

8 Big Challenges of the Fashion Industry in 2023 26

 06 Global Supply Chains Ongoing Changes in
the Fashion Sector
2023

Opportunities
Reliability
Rethinking your supply chain is a major
undertaking, but it will make your
business more resilient in the long run.
Reducing the need for transportation
or using multiple logistic strategies will
help you respond quickly to anything the
future might bring. Try to take advantage
of existing infrastructure wherever you
can. For example, businesses in the US
or UK could consider using an EU-based
warehousing service rather than fulfil-
ling orders from their home countries.
This shortens delivery times and
may save customers from unexpected
customs fees.

Tip:
Don’t forget to adjust your delivery communication guidelines. In uncertain times, con-
sumers worry easily about problems that might occur during or after ordering online.
Or they reconsider and don’t order because they even expect problems to come up.
Rise to the challenge and inform your customers timely about possible delays, along
with delivery estimates. Adjust delivery times in your shop to prevent frustrations
and cancellations. Keep customers updated all the time – in particular when you have
to suspend deliveries.

“Rethink your warehousing strategy and take advantage of existing

structures. Experienced partners can help you in setting up
leaner, faster, and more efficient delivery processes designed
for cross-border business. That will not only reduce dependencies
but also your total costs because you can leverage synergies.”

Tobias Ring
Director Growth Services
SCAYLE
8 Big Challenges of the Fashion Industry in 2023 27
 07 Seamless Omnichannel
Seamless Omnichannel
Gains Popularity
Challenge #7
The lines between digital and physical
shopping are blurring – and not just because
of the pandemic. Brands and retailers need
Challenges
ROPO (Research Online, Purchase
Offline) has already been prevalent prior
to the pandemic. Also, customers would
look around in a physical store but then
order the product online from a vendor
Solutions
Companies need to focus on customer
experience, which must be both con-
sistent and inspiring. When your brand
inspires your target audience, customers
are less likely to price shop. You have to
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
to offer omnichannel commerce that gives
customers a seamless experience no matter
where they shop.
with a lower price ("showrooming").
Physical stores need to find ways to
cope and become more attractive with
additional services.
ensure that your eCommerce platform can
create a seamless brand experience across
all channels. Modern, flexible commerce
technology is crucial to success.
28
 07 Seamless Omnichannel Ongoing Changes in
the Fashion Sector
2023

Opportunities
Synergies
Setting up omnichannel commerce is
a lot of effort. But it pays off because
a holistic omnichannel strategy will
prevent losses along the way. Whether
a brick-and-mortar store is adding
or expanding an online shop, or an
eCommerce brand is adding physical
retail to the mix, omnichannel lets
brands take advantage of the synergies
between the different channels.

Tip:
The greatest opportunity comes from the chance to take advantage of each
channel’s strengths.

01. Click & Reserve and Click & Collect let customers research online but
purchase in-store, including trying on clothes before taking them home
or swiftly picking up orders on the go.
02. In-store returns are more convenient for some customers and make
exchanges easy, for instance, by allowing customers to use their return
balance immediately for in-store payments.
03. Ship from store enables stores to act as miniature logistics centers,
shipping directly to customers for ultra-quick turnaround times.
04. Order on behalf empowers staff to place customers’ orders by accessing
the global stock pool no matter where products are stored and ship them
to a store, pick-up point, or directly to the customer’s home address.

8 Big Challenges of the Fashion Industry in 2023 29

 07 Seamless Omnichannel Ongoing Changes in
the Fashion Sector
2023

01

02

03

04

“Help your employees to proactively sell more by

seamlessly connecting online with offline. Make store
inventories accessible for everyone and offer your
offline stock online as well. Avoid a silo mentality.
Only if you empower and reward both business lines
equally, you’ll realize your full potential.”

Tobias Ring
Director Growth Services
SCAYLE

8 Big Challenges of the Fashion Industry in 2023 30

 08 Efficiency
Driving Efficiency With
Modern Technology
Challenge #8
The fashion industry is used to its ups and
downs and finding new ways to cope with
new challenges. One of its biggest strengths is
adapting its processes to new circumstances
and making them more efficient. And 2023
will be one of these defining years to make
change happen. If you bail out now because
of the year’s macroeconomic challenges,
you’ll have difficulties catching up as your
Challenges
Operating at peak efficiency will
require brands to become more flexible
right at their core. Monolithic, tightly
interconnected eCommerce platforms
used to be perfectly fine when you
had the time, resources, and budget
to afford a highly complex all-inclusive
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
competitors have already started moving.
In addition, it’s essential to not just keep
optimizing in times of need but be one step
ahead with technology that enables your
growth sustainably. Start with decluttering
your current tech stack and exchange your
“but it was always good enough” solutions
for “that’s what I need now and in the future”
solutions.
solution that required, well, lots of time,
resources, and budget. They used to be
convenient. Now, in many cases, they are
a nuisance because they fail to scale and
don’t even provide the bare necessities
required for modern commerce.
31
 08 Efficiency Ongoing Changes in
the Fashion Sector
2023

Be aware that there are different levers you need to consider when increasing the
efficiency of your business.

√ Performance: modern architectures enable you to adapt your system quickly

and scale it along your growth across all channels
√ Productivity: intuitive, powerful user interfaces, and lean processes empower
your team to streamline their tasks effectively with automated workflows
√ Costs: only invest in what adds to your value proposition and make use of
synergies

Solutions
Brands need to reconsider their digital
strategy and opt for solutions with built-
in flexibility and scalability. An API-first
approach will allow you to implement a
best-of-breed strategy by quickly on- and
offboarding new tools and functionalities
as needed. Instead of sticking to suite
solutions that rigidly link tools you
might not even need, go for dynamically
adding your favorite tools via API that
were designed to scale with your
functionalities.

APIs

Back End

8 Big Challenges of the Fashion Industry in 2023 32

 08 Efficiency
Also, watch out for intuitive user inter-
faces that enable your team instead of
making their work more complicated.
User panels need to be optimized for
the whole set of tasks shop managers,
content managers, etc., need to attend
to. Are user interfaces developed from
actual operational experience? You’ll
notice the difference when your team
can proactively contribute to building
more efficient workflows, for instance,
by configuring complex logic that would
usually need a certain amount of coding
effort. In addition, automated and dyna-
mic task managers within the user panel
will help accelerate processes like pro-
duct information refinement, ensuring
Opportunities
Flexibility
Large assortments often require more
complex and varying product data
schemes. Flexible, scalable solutions will
ensure you can easily adapt your product
data for different product families – no
matter how diverse your products are
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
data quality, or translating product data
with a simple set of rules.
Don’t stop here yet. A flexible, growth-
enabled tech stack that helps you in-
crease productivity is a good starting
point. But also look for synergies you
could benefit from to make your solution
even more cost-effective. Some com-
merce platforms offer pre-integrated
functionalities or tools that are readily
available, which means you won’t have
any integration or maintenance efforts.
Cloud solutions usually also offer full-
service models without extra charge,
e.g., for development, hosting, or
monitoring.
and what systems you need to connect.
An attribute-based system will allow
you to universally define the highest
quality guidelines you need for efficient
processes, data-driven decisions, and
personalization.
33
 08 Efficiency Ongoing Changes in
the Fashion Sector
2023

Tip:
Maximum flexibility might not always get you ahead. Actually, it can hold you
back when you don’t need it. So evaluate carefully what you need to get utmost
efficiency while staying as flexible as you need to be to drive your business forward.
For instance, will building your own tools and features or having them built for
you actually be an investment worthwhile? Or will you just end up with the same
functionalities everyone else in the industry is using, with the only difference being
that it took you more time, resources, and costs to get there? Seek efficiencies
within the default and focus your efforts on what makes you unique.

“Having all options available

is great. But have you ever
used a tool you thought was
made for you because it already
considers everything you need
to do just the way you want it?
Take advantage of solutions that
are already designed for your
use case. Your processes will
automatically be more efficient
and drive your growth more
effectively.”

Tobias Ring
Director Growth Services
SCAYLE

8 Big Challenges of the Fashion Industry in 2023 34

 Conclusion Ongoing Changes in
the Fashion Sector
2023

Find Your Own

Unique Strategy
to Drive Your
Business
Forward in 2023
Fashion companies are all facing similar software architecture. Give some thought
challenges, but you still need to develop your to your supply chain and how you can make
own unique strategy. Find an eCommerce it more sustainable and resilient. And then
platform that will cover all your bases (now invest in what sets your brand apart.
and in the future) with a flexible, modern

Some ideas:

√ Membership or loyalty programs √ Adding social commerce or live shopping

√ Unique front ends to your marketing mix
√ Building a second-hand marketplace for √ Offering limited editions – in real life or
your brand maybe even in the metaverse

8 Big Challenges of the Fashion Industry in 2023 35

 Conclusion
Not all the options will be right for all brands,
of course. It’s up to you to decide what your
target market wants most.
Whatever you decide on: Identify ways to
increase efficiency within your daily work.
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
the Fashion Sector
2023
Evaluate your tech stack, take advantage
of features designed for your use case, and
establish processes that will also get you
ahead of the curve tomorrow – no matter
what the next challenge will be.
Need a partner
but don’t
know where to
look?
SCAYLE is more than just an
eCommerce platform providing
modern commerce technology.
With our hands-on B2C retail
experience, we can also support
you with operational expertise
and practical advice as a full-
fledged partner.
36
 Endnotes
↗
Sources
Euromonitor International (2022): World Market for Apparel and Footwear
https://www.euromonitor.com/world-market-for-apparel-and-footwear/report
Statista (2023): Most significant business challenges for the fashion industry in
the United States according to fashion executives in 2022
https://www.statista.com/statistics/1326406/fashion-industry-main-
challenges/
McKinsey & Company (2022): The State of Fashion
https://www.mckinsey.com/industries/retail/our-insights/state-of-fashion
SCAYLE (2022): How Lifestyle Brands Can Realize D2C in a Platform World
https://www.scayle.com/guides/papers-how-to-direct-to-consumer-ambition
SCAYLE (2022): Online Marketplaces
https://www.scayle.com/blog/online-marketplace
eTailment (2022): Wholesale oder Dropshipping? Warum Hybrid-Modelle die
bessere Wahl sind
https://etailment.de/news/stories/vertriebsstrategien-wholesale-oder-
dropshipping-warum-hybrid-modelle-die-bessere-wahl-sind-24150
McKinsey & Company (2022): Becoming indispensable: Moving past
e-commerce to NeXT commerce
https://www.mckinsey.com/capabilities/growth-marketing-and-sales/
our-insights/becoming-indispensable-moving-past-e-commerce-to-next-
commerce
McKinsey & Company (2020): Moving past friend or foe: How to win with digital
marketplaces
https://www.mckinsey.com/industries/retail/our-insights/moving-past-friend-
or-foe-how-to-win-with-digital-marketplaces
McKinsey & Company (2022): The State of Fashion 2023: Holding onto growth
as global clouds gather
https://www.mckinsey.com/industries/retail/our-insights/state-of-fashion
Autoriteit Consument & Markt (2022): Decathlon en H&M zullen consumenten
voortaan beter informeren over duurzaamheid
https://www.acm.nl/nl/publicaties/decathlon-en-henm-zullen-consumenten-
voortaan-beter-informeren-over-duurzaamheid
Publications Office of the European Union (2022): Sustainable and Circular
Textiles by 2030
https://www.interregeurope.eu/sites/default/files/2022-05/Textiles_
Factsheet_EC.pdf
The Sustainable Mag (2020): Gucci Off The Grid – The first collection from
Gucci Circular lines
https://thesustainablemag.com/fashion/gucci-circular-lines/
SCAYLE (2021): Influencer Marketing: Increase Your Revenue With Content
Creators
https://www.scayle.com/blog/influencer-marketing-revenue
Statista (2022): Social commerce Gross Merchandise Value (GMV) in the United
8 Big Challenges of the Fashion Industry in 2023
Ongoing Changes in
2023
the Fashion Sector
States from 2022 to 2028
https://www.statista.com/statistics/277045/us-social-commerce-revenue-
forecast/
Pew Research Center (2021): Social Media Fact Sheet
https://www.pewresearch.org/internet/fact-sheet/social-media/#panel-
81867c91-92ad-45b8-a964-a2a894f873ef
McKinsey & Company (2021): It’s showtime! How live commerce is transforming
the shopping experience
https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/its-
showtime-how-live-commerce-is-transforming-the-shopping-experience
Insider Intelligence (2022): TikTok will drive social commerce growth in 2023
https://www.insiderintelligence.com/content/tiktok-will-drive-social-
commerce-growth-2023
China Briefing (2022): China’s Livestream Industry: Market Growth, Regulation,
Enabling Technology, and Business Strategies
https://www.china-briefing.com/news/chinas-livestream-industry-market-
growth-regulation-enabling-technology-and-business-strategies/
Euromonitor International (2022): Digital Transformation in Fashion: Lessons
from China
https://www.euromonitor.com/digital-transformation-in-fashion-lessons-from-
china/report
Technode (2022): What are Alibaba’s strategies on livestreaming and loyalty
membership programs on Singles Day 2022?
https://technode.com/2022/11/04/what-are-alibabas-strategies-on-
livestreaming-and-loyalty-membership-programs-on-singles-day-2022/
Datareportal (2022): Digital 2022: Time spent using connected tech continues
to rise
https://datareportal.com/reports/digital-2022-time-spent-with-connected-tech
CNN style (2022): Luxury fashion houses are funneling millions into the
metaverse. But to what end?
https://edition.cnn.com/style/article/fashion-metaverse-millions-september-
issues/index.html
Sensorium (2022): 15 Fashion Brands Leveraging The Metaverse
https://sensoriumxr.com/articles/fashion-brands-in-the-metaverse
NOKIA (2022): Gen Z and the metaverse
https://www.nokia.com/networks/insights/metaverse/metaverse-gen-z-
research/
SCAYLE (2022): Supply bottlenecks: How to Optimize Your Communication for a
Better Customer Experience
https://www.scayle.com/blog/supply-bottlenecks
Forbes Insights (2016): A Split Screen: Online Information and a Human Touch
https://images.forbes.com/forbesinsights/StudyPDFs/Synchrony-A_Split_
Screen-Report.pdf
37
 Contact
Contact
SCAYLE your tech. SCAYLE your business.
Build the foundation for rapid, flexible, and
sustainable growth.
About SCAYLE
SCAYLE is the B2B division of ABOUT YOU
Holding SE and enables brands and retailers
to build up an international D2C business
with three service components: commerce
Rico Adler
Head of Solution Consulting
SCAYLE – Commerce Engine
Ongoing Changes in
the Fashion Sector
2023
technology, online marketing, and commerce
operations. Leading brands like Fielmann, FC
Bayern, Marc O’Polo, Deichmann, s.Oliver, or
DEPOT are already SCAYLE customers. By
now, the SCAYLE Commerce Engine powers
100 online shops in 26 European countries.
SCAYLE employs 400 people at its location in
Hamburg. The managing directors are Tarek
Müller, Sebastian Betz, and Hannes Wiese.
Tobias Ring
Director Growth Services
SCAYLE – Commerce Engine
scayle.com
scayle@aboutyou.com
© 2023 SCAYLE ABOUT YOU SE & Co. KG