According to José Neves, founder and CEO of Farfetch (the largest online platform that connects more than 700 brands and offline stores around the world), the digitalization of luxury can no longer be stopped. According to him, the future of fashion will rely on hyper-personalization both online and in physical stores.
However, this will not happen overnight. According to Neves in a conversation with wwd, though fashion and technology are converging, they are still worlds apart in terms of priorities, and their fundamental views on business.
A former programmer and shoe salesman, Neves knows both worlds well. He said tech companies "don't know most things about luxury fashion," particularly the magical intangibles that drive the business.
"It's an industry of emotion, aesthetics, desire, and tech companies lack that. Fashion is the opposite of a technological mindset based on certain material values," he said, pointing to Amazon, which he said prioritizes just such values, low prices and free shipping.
According to José Neves, founder and CEO of Farfetch (the largest online platform that connects more than 700 brands and offline stores around the world), the digitalization of luxury can no longer be stopped. According to him, the future of fashion will rely on hyper-personalization both online and in physical stores.
However, this will not happen overnight. According to Neves in a conversation with wwd, though fashion and technology are converging, they are still worlds apart in terms of priorities, and their fundamental views on business.
A former programmer and shoe salesman, Neves knows both worlds well. He said tech companies "don't know most things about luxury fashion," particularly the magical intangibles that drive the business.
"It's an industry of emotion, aesthetics, desire, and tech companies lack that. Fashion is the opposite of a technological mindset based on certain material values," he said, pointing to Amazon, which he said prioritizes just such values, low prices and free shipping.
On the other hand, fashion is also not yet fully aware of the importance of hyper-personalization in marketing and shopping. Neves said that's one of the reasons why influencers like Vogue, Glamour, Vanity Fair and Cosmopolitan have been surpassed by Instagram and TikTok.
"You can't personalize a magazine" like an app, the Farfetch founder said, adding that brands and retailers also need to think about how they can simplify the experience of shoppers from different regions and between online and offline retail.
"Every shopper should be treated as a VIP customer, and that's where we come in," Neves says. "All the technology we create is for the benefit of luxury brands and consumers."
He said Farfetch spends "hundreds of millions of dollars" each year on technology and that its role is to do the hard work and be "comrades and partners in innovation" for brands and retailers as they digitize their businesses. Already, Farfetch is working with brands, fashion groups and Alibaba to connect the dots on the path to purchase and optimize online and offline retail sales.
The company is working with Alibaba to bring new brands to Tmall (formerly called Taobao Mall, is a Chinese-language B2C online retail website based on Taobao, powered in China by Alibaba Group.); it's working with Chanel on in-store service, and with Browns (which Farfetch owns) on personalized customer journeys and on bridging the online-to-offline divide at its new Brook Street store in London.
Farfetch is also exploring and promoting new technologies such as virtual fitting services, which Neves believes have "huge potential". He pointed to a project that Farfetch incorporated between Off-White and Snapchat, where customers could try out artificial intelligence technology.
The online platform already uses artificial intelligence technology to help customers try on sneakers and sunglasses. In the future, Farfetch will apply it to beauty industry offerings as well - the company plans to enter the beauty category next year to be able to present a holistic look to consumers.
Neves also talked about Farfetch's recent major deal with Compagnie Financière Richemont and Alibaba.
In a new global strategic partnership, Richemont and its Chinese ally Alibaba are investing hundreds of millions of dollars in Farfetch Ltd. and in a new joint venture called Farfetch China. The ultimate goal of the alliance is to give luxury brands "enhanced access" to the Chinese market and bring physical and digital retailing together at a time when more people are shopping online but still crave offline experiences. As part of the deal, Farfetch has launched Alibaba's luxury platforms in China.
Neves said business was going "remarkably well", with Farfetch bringing more than 3,000 brands and a potential audience of 800 million customers to Tmall. He added that Alibaba has set out to "digitize the physical world globally, not just in China."
Looking ahead, Neves believes that online will account for 40% of luxury apparel sales, while offline will account for 60%. Offline will also be "digitized," as Browns is today.
Browns reportedly wants its customer journey to start anywhere - on a cell phone in the back of a cab; on a tablet in someone's kitchen or in a store. The retailer wants to be able to communicate with the customer every step of the way.
According to Nevis, the physical store will always have a role to play, "and we have a very ambitious roadmap for the future."
