Generative AI in 2024: Adoption Trends and Major Use Cases in the Fashion Industry
Written by Jiwoon Kim & B. Ellie Jin
Over recent years, artificial intelligence (AI) has increasingly permeated our lives and helped companies make their businesses more efficient and profitable. In particular, generative AI has sparked an unprecedented surge of innovations since its rise in late 2022. Generative AI’s capability to accelerate innovation and create new business models has been highlighted in various industries including fashion, attracting significant global attention in 2023. Our earlier FTBEC article, “Generative AI in the Fashion Industry: Are You Embracing It?”, explored the potential of generative AI to enhance the fashion industry. Now in 2024, generative AI has moved beyond being merely a novelty. Organizations are not only learning about its potential but are genuinely embracing this emerging technology and reaping substantial business value from it. How are companies currently harnessing generative AI, especially within the dynamic realm of the fashion industry?
The Landscape of Generative AI Adoption in 2024
The adoption of generative AI has rapidly increased worldwide in the past year. According to the latest McKinsey Global Survey on AI, the use of generative AI grew across all industries, with the largest increase in adoption observed in the business, legal, and professional services industries.
The regular utilization of generative AI almost doubled in 2024 compared to the previous year’s results, with sixty-five percent of respondents reporting that their organizations have adopted generative AI in at least one business function.
Among business functions, generative AI was most commonly used for (1) marketing and sales, (2) product and service development, and (3) IT (Figure 1). The two functions that are most commonly adopted, marketing and sales and product development, are also the functions that were identified as having the most prominent value potential in McKinsey’s previous AI research. Within marketing and sales, the most common use cases were content support for marketing strategy, personalized marketing, and sales lead identification. Within product and service development, generative AI was used most often for design development, literature review, and accelerated early simulation. Major use cases within the IT function included IT help desk chatbot, data management, and IT help desk AI assistant.
Figure 1. Generative AI Adoption by Function
The Most Common Use Cases of Generative AI in the Fashion Industry
The fashion industry is also experiencing an acceleration in the adoption of generative AI. As noted in our previous FTBEC article, generative AI holds potential in a wide range of applications in the fashion industry spanning fashion design, visual content generation, copywriting, and enhancing customer experiences. According to the BoF-Mckinsey The State of Fashion 2024 Global Fashion Executive Survey, 62 percent of fashion executives reported that their companies have utilized generative AI, and 73 percent indicated that generative AI will be a major priority for their businesses in 2024.
Generative AI is capable of adding value across multiple stages of the fashion value chain. However, according to the executive survey, marketing and product development were identified as the most common use cases of generative AI in the fashion sector as well. As represented in Figure 2, the most common use case of generative AI was marketing-writing copy, followed by design and product development, marketing-visual content, organizational and corporate support functions, and digital shopping and customer experience. Use cases in supply chain and logistics and store operations were relatively less reported.
Although it is most commonly used for marketing and product development, generative AI is now being integrated into broader facets of the fashion industry, resulting in more diverse use cases. For example, LVMH uses generative AI to enhance, not replace, human creativity and expertise. Through its AI Factory, LVMH enhances its employees’ abilities to serve clients by helping client advisors make better recommendations to personal clients and identifying high-potential customers to contact (McDowell, 2024). AI is also used to converge fashion and gaming, as evidenced by Tommy Hilfiger’s launch of the interactive mobile fashion game FashionVerse. Generative AI is utilized here to create photorealistic 3D avatars and outfits (McDowell, 2023).
Figure 2. Generative AI Adoption in the Fashion Industry
In sum, generative AI adoption in the industry is on the rise, and innovative companies are already leveraging it to create value in diverse ways. As of now, generative AI is most commonly used in marketing and product development, but as more companies embrace it and technology evolves, new use cases and promising opportunities are expected to emerge. Accordingly, there has been a surge in conversations regarding AI’s potential and applications in the fashion industry. For instance, North Carolina State University FTBEC(Fashion and Textiles Business Excellence Cooperative) is hosting the “2024 AI in the Textile and Fashion Industries” conference to discuss the ways AI is revolutionizing the textile and fashion industry and fostering growth. Now is not the time to simply recognize the power of generative AI and watch. Businesses should be aware of its specific use across various sectors and actively engage in discussions to truly understand how it can be effectively implemented within their organizations.
References
Amed, I., Balchandani, A., Barrelet, D., Berg, A., D’Auria, G., Rölkens, F., & Starzynska, E. (2023, November 29). The State of Fashion 2024. The Business of Fashion and McKinsey & Company. Retrieved from: https://www.mckinsey.com/industries/retail/our-insights/state-of-fashion#/
Chui, M., Hazan, E., Roberts, R., Singla, A., Smaje, K., Sukharevsky, A., Yee, L., & Zemmel, R. (2023, June 14). The economic potential of generative AI: The next productivity frontier. McKinsey & Company. Retrieved from: https://www.mckinsey.com/capabilities/mckinsey-digital/our-insights/the-economic-potential-of-generative-ai-the-next-productivity-frontier
McDowell, M. (2024, July 9). Inside LVMH’s AI Factory. Vogue Business. Retrieved from: https://www.voguebusiness.com/story/technology/inside-lvmhs-ai-factory
McDowell, M. (2023, December 19). Tommy Hilfiger on AI and his new fashion game. Vogue Business. Retrieved from: https://www.voguebusiness.com/story/technology/tommy-hilfiger-on-ai-and-his-new-fashion-game
Min, Y-W. O., & Jin, B. E. (2023, September 22). Generative AI in the fashion industry: Are you embracing it? Fashion and Textile Business Excellence Cooperative. Retrieved from: https://ftbec.textiles.ncsu.edu/generative-ai-in-the-fashion-industry-are-you-embracing-it/
Singla, A., Sukharevsky, A., Yee, L., Chui, M., & Hall, B. (2024, May 30). The state of AI in early 2024: Gen AI adoption spikes and starts to generate value. McKinsey & Company. Retrieved from: https://www.mckinsey.com/capabilities/quantumblack/our-insights/the-state-of-ai