<\/p>\n
\n\tArtificial intelligence is big, scary, exciting and more than just a little undefined.<\/p>\n
\n\tIts promise encompasses almost everything. A world of abundance and ease? Sure. The end of civilization? Maybe.<\/p>\n
\n\tEven the more likely middle ground could be profoundly transformative for the fashion industry as designers, store managers, lawyers, truck drivers and more all negotiate work life with \u2014 what? \u2014 AI colleagues?<\/p>\n
\n\tThe language to describe this future doesn\u2019t exist and so it\u2019s all still so hard to fathom.<\/p>\n
\n\tBut there are some signs suggesting what comes next, history that\u2019s instructive and many, many questions that together offer a starting point, perspective on where AI is today and where it\u2019s going. Get your thinking cap on.<\/p>\n
\t\tThe Latest Revolution\t<\/p>\n
\n\tBig, transformative and technologically driven change is something the world has been living through for 250 years.<\/p>\n
\n\tThe McKinsey Global Institute recently drew a line from the development of steam power in the 1770s to electricity in the 1880s, computers in the 1970s, the internet in the 1990s and, finally, AI today.<\/p>\n
\n\t\u201cGeneral-purpose technologies can transform economies and improve lives, but realizing their full potential takes more than the invention itself. It requires complementary innovation, new infrastructure, new rules, capital and people and organizations willing to change how they work,\u201d McKinsey said in a recent report on the AI economy.<\/p>\n
\n\tIt took 100 years for steam to hit its peak share of per capita GDP growth of 30 percent. Electricity hit 10 percent of GDP after 40 years. And computers and the internet together topped out at 50 percent of economic growth.<\/p>\n
\n\t\u201cThe first uses of major new technologies are rarely the most consequential,\u201d the consultancy said. \u201cElectricity began as a replacement for gas lighting before transforming industries and enabling entirely new forms of economic activity. AI may likewise give rise to new products, businesses and markets that are difficult to anticipate today.<\/p>\n
\n\t\u201cUsing the technology to automate existing work is a first step, but leaders should use the resources freed up to build new sources of growth,\u201d the report said.<\/p>\n
\n\tSo this is still just the beginning for AI, which, once it establishes itself more fully in the economy, could open up the way to unexpected advancements of who knows what.<\/p>\n
\t\t\t\t\tBig technological changes have been rushing forward and changing life for 250 years.<\/p>\n
\t\t\t\t\t\t\t\t\tHulton Archive\/Getty Images<\/p>\n
\t\tLearning Lessons\t<\/p>\n
\n\tThe good news is, this business of wading through the messy introduction of a new, broad technology is something fashion has been figuring out for the last generation.<\/p>\n
\n\tMany of the industry\u2019s top executives started their work lives during the dot-com boom, saw the initial excitement, the inevitable crash and the steady rise of online adoption.<\/p>\n
\n\tIt didn\u2019t actually go that well at first \u2014 the retail leaders of the time let Amazon elbow in and take the lion\u2019s share of e-commerce \u2014 but lessons were learned.<\/p>\n
\n\t\u201cThe people who missed the e-commerce boat didn\u2019t follow the customer,\u201d said Yang Lu, chief information and digital officer at Coach-parent Tapestry Inc. \u201cThat\u2019s why we follow our customer.<\/p>\n
\n\t\u201cWhen I was growing up, we went to the stores, so high-level marketing used to be the key,\u201d Lu said. \u201cThen the computer came out, the internet came out, all of a sudden the product discovery happened with browsers. So following the customers\u2026we need to show up online. Then social media reshaped everything. Kids discover products through Instagram and TikTok.\u201d<\/p>\n
\n\tSpinning that trend forward into an AI world is easy.<\/p>\n
\n\t\u201cThe latest Adobe research actually says 40 percent of people shop using some kind of AI tool and traffic coming to our site through AI tools has a 48 percent higher dwell time on the site,\u201d she said.<\/p>\n
\n\tThat makes AI a vital connector to the consumer, even if it\u2019s still too early to tell how the technology will develop.<\/p>\n
\n\tLu recently met with a group of students and told them that, as future leaders, the responsibility for managing this evolution might well be on them.<\/p>\n
\n\t\u201cThe government right now has not figured out really how to regulate [AI],\u201d she said. \u201cGovernance is key. Governance is enablement. How do we put the right guardrails, governance, ethics [on it]? There\u2019s so much work to be done there.<\/p>\n
\n\t\u201cThere\u2019s so much anxiety out there,\u201d she said. \u201cI think that\u2019s why as a business we\u2019re so intentional and focused that we\u2019re not going to do AI for the AI\u2019s sake. We\u2019re always going to start with our customers and follow our customer and use AI intentionally.\u201d<\/p>\n
\n\tThat means getting smart about AEO \u2014 agentic engine optimization \u2014 and focusing on first-party content, third-party content, technology and measurement.<\/p>\n
\n\t\u201cWe\u2019re actually putting a lot of content out again,\u201d Lu said. \u201cFor example, content on how do you take care of your leather?\u201d<\/p>\n
\n\tThat\u2019s because AI will give a deep dive into leather care more credit than a small product description or brief explanation.<\/p>\n
\n\tIn the end, she said it comes down to how humans are using the technology.<\/p>\n
\n\t\u201cPeople are our competitive advantage,\u201d Lu said. \u201cOur culture is to test, learn, iterate \u2014 innovation is experimentation. And by the way, we\u2019re OK with failure because it\u2019s an important step for learning.\u201d<\/p>\n
\t\tThe New Luddites\t<\/p>\n
\n\tEven if people \u2014 fingers crossed \u2014 remain an engine of change in the AI world, there are persistent worries about how the human equation will change with machines taking on more of the cognitive load.<\/p>\n
\n\t\u201cThere are folks out there who are desiring a massive slowdown, a sort of a Luddite movement where, \u2018Hey, we\u2019re playing with fire here. We really need to reverse course,\u2019\u201d said Marc Palatucci, who leads Future Today Strategy Group\u2019s fashion, apparel and luxury practice. \u201cAnd I don\u2019t think they\u2019re wrong that there are massive risks, in some cases, extreme cases, existential risks, but I truly believe that the trajectory is irreversible. I think it is that we can adjust the course, but we cannot un-ring the bell.\u201d<\/p>\n
\n\tAI is here to stay. It\u2019s actually been here for a while.<\/p>\n
\n\t\u201cWe\u2019ve been interacting with it and reaping some benefits of it arguably for decades,\u201d Palatucci said. \u201cIt was Netflix telling us what to watch next or Google knowing how to finish your search query.<\/p>\n
\n\t\u201cWhat I recommend to both family and friends and to clients is curiosity,\u201d he said. \u201cGet your hands dirty, roll up your sleeves, see what this is all about. I have friends who say, \u2018Well, I won\u2019t use it because I don\u2019t like the guys who are in charge of the companies. I think it\u2019s heading us down a dark road. I don\u2019t want to give them my data.\u2019 I respect that, but I respectfully suggest that those folks, if they think it\u2019s an enemy, know your enemy.\u201d<\/p>\n
\n\tPeering into his well-polished crystal ball, Palatucci pointed to the importance of AI\u2019s potential to jump from the screen to the physical world.<\/p>\n
\n\t\u201cWhere the industrial revolution allowed productivity to scale, this physical AI revolution, if we can call it that, is going to allow intelligence to scale,\u201d he said. \u201cSo the factory itself is going to learn as it produces, rather than having a human come in and say, \u2018Well, what if we tweak this one gear?\u2019\u201d<\/p>\n
\n\tTaking the human out of the equation has consequences.<\/p>\n
\n\t\u201cThe question is, \u2018What else do we do?\u2019\u201d Palatucci said. \u201cThis comes down to the existential question of the purpose of being on the planet. A lot of folks do agree that being occupied is a critical component to happiness and self-worth.\u201d<\/p>\n
\n\tThere are very prominent worries about what people will do in the AI future, but Palatucci said the regular old economy will help regulate the change.<\/p>\n
\n\t\u201cThe system that we\u2019ve got in place \u2014 which is not going to be overturned overnight, even if AI does disrupt it all \u2014 relies on money changing hands and money being spent,\u201d he said. \u201cI don\u2019t have much fear of widespread bankruptcy among the average citizen because the system won\u2019t allow for it.\u201d<\/p>\n
\t\t\t\t\tWork life might never be the same after AI gets fully plugged in to business. <\/p>\n
\t\t\t\t\t\t\t\t\tKevin Frayer\/Getty Images<\/p>\n
\t\tThe Sooner or Later Financial Disruption\t<\/p>\n
\n\tAI is bound to disrupt work in one way or another.<\/p>\n
\n\tFor now fashion companies are inching closer to being able to grow their businesses with the same workforce than outright replacing large groups of employees with robots.<\/p>\n
\n\tBut the first financial fallout of AI might not be in payrolls.<\/p>\n
\n\tMcKinsey estimated that global investment in data centers will total $7 trillion between 2025 and 2030, much of it driven by AI. More than 40 percent of that is expected in the U.S.<\/p>\n
\n\tThis year alone, U.S. imports of AI-related goods are on track to hit about $750 billion or, as the consultancy said, \u201cabout as much as its imports of cars, oil and gas, and pharmaceuticals combined.\u201d<\/p>\n
\n\tThat\u2019s a level of spending that suggests an ever-growing increase in the value and benefits of AI that might not materialize.<\/p>\n
\n\t\u201cThe financial projections on AI, I think are delusional,\u201d said Jonathan Low, a partner at the Predictiv consultancy who specializes in the financial impact of intangibles. \u201cEvery human on Earth plus the residents of several other solar systems would all have to be buying AI at a premium to support these growth projections.<\/p>\n
\n\t\u201cThe question to me is, given the degree to which AI is propelling the economy right now: Is the enhancement of productivity and efficiency going to be sufficient to overcome what I assume will be a politely called correction at some point when it becomes evident that we\u2019re not all going to be billionaires,\u201d Low said.<\/p>\n
\n\t\u201cThe cost of implementation of AI is going to be much greater than anyone is willing to admit, and it\u2019s going to take time and it\u2019s going to be disruptive,\u201d he said. \u201cAnd as a result, companies are not going to realize the profits or ancillary benefits as quickly as they were led to believe they would. That\u2019s not necessarily a bad thing. It just means that we\u2019re kind of in over-hype mode right now.\u201d<\/p>\n
\n\tAnd there\u2019s hype on both sides of AI \u2014 the extravagant spending and the very public concerns from industry leaders that rogue agents will disable power grids or spark the next pandemic with an engineered superbug.<\/p>\n
\n\t\u201cThis whole extinction conversation has maybe gotten a little crazy,\u201d Low said. \u201cIs it in the realm of possibility? I guess it must be because some very smart people are saying it is. But to me, the more immediate threat is, is this all going to collapse because nobody\u2019s really making money from this right now.\u201d<\/p>\n
\t\tToo Much\t<\/p>\n
\n\tWhen Katie Thomas, who leads the Kearney Consumer Institute, pulled together a recent snapshot on how consumers will evolve over the next decade, she called it, \u201cThe Tyranny of Too Much: The Future Consumer.\u201d<\/p>\n
\n\t\u201cConsumers are both products and architects of a shared personal, collective and commercial environment,\u201d the report said. \u201cOver decades, the push for greater choice, convenience and personalization has created a world in which options, inputs, tasks and interactions continue to compound faster than consumers\u2019 capacity to navigate them. And AI is only adding to that compounding effect.\u201d<\/p>\n
\n\tValue lies instead in \u201creducing the effort required to navigate emotional, physical and mental overload while consistently delivering outcomes consumers can verifiably trust,\u201d the report found.<\/p>\n
\n\tIf shopping has become a little too much for consumers, it\u2019s not because they\u2019re running out of time.<\/p>\n
\n\t\u201cI estimated that in the last 10 years, about 40 minutes a day were freed up due to automation and other things, but that looking forward 10 years, it\u2019ll be about 80 minutes,\u201d Thomas said in an interview. \u201cThat\u2019s not time that\u2019s immediately reabsorbed. If you and I are saving time with AI at work, but we\u2019re still just working, it\u2019s not bad. It\u2019s that people actually, believe it or not, are working a little bit less. Work weeks are getting a little bit shorter. In the last 10 years, most of that free time went into streaming and scrolling.\u201d<\/p>\n
\n\tTo cut through, Thomas advises that brands refocus on their core mission.<\/p>\n
\n\t\u201cWhen you think about trust, trust is built through consistent experiences with the brands,\u201d she said. \u201cWe\u2019ve seen a shift from trust in the [brand] to trust in the outcome and the actual performance [of the products]. We were already on this trajectory when you think of reviews, but even the average consumer knows now that those are a bit manipulated. So it\u2019s really going back to literal outcome and experience with the product, which can only be achieved by delivering on the core.\u201d<\/p>\n
\n\tKearney estimated that by 2036, $20 trillion in consumer spending will be up for grabs due to \u201ctrust failures.\u201d<\/p>\n
\n\t\u201cTraditionally seen as impeccable sources of authority and trust, mass brands have always benefited from consumer inertia \u2014 the shopper perception that finding alternatives to the brands they purchase is just too much effort,\u201d the report said.<\/p>\n
\n\tIn the future, inertia will not be enough.<\/p>\n
\t\tSkeptics All Around\t<\/p>\n
\n\tWhat will fly and what won\u2019t in the age of AI is still an open question.<\/p>\n
\n\tBut many aren\u2019t waiting for all those changes to come to pass before raising the alarm.<\/p>\n
\n\tPublic policy advocate Groundwork Collaborative recently dug into work going on at the evermore digital Walmart Inc. and tried to glimpse what\u2019s on the way.<\/p>\n
\n\tThe group\u2019s report reads like sci-fi.<\/p>\n
\n\t\u201cWalmart can tell your favorite Ben & Jerry\u2019s flavor by seeing which one makes your heart race,\u201d Groundwork Collaborative said. \u201cOne patent application details an invasive system to determine user preferences. First, customers would be tracked within the store using facial recognition on store cameras, drones flying around the store or cell phone signals when you\u2019re connected to the store\u2019s Wi-Fi.<\/p>\n
\n\t\u201cThen, data from heart rate and glucose monitors could reveal how customers feel about ice cream flavors,\u201d the group claimed.<\/p>\n
\n\tA less dramatic example in the report claimed Walmart\u2019s patent for \u201cdynamic pricing systems and methods\u201d would help it change prices from customer to customer.<\/p>\n
\n\t\u201cWalmart executives can claim that they don\u2019t personalize prices, but they\u2019re spending considerable resources to develop technology that would do just that,\u201d Groundwork Collaborative said. \u201cCorporations do not spend the time and money, or hire highly specialized staff, to develop and patent technology only to file it away on a hard drive never to enter a store or be coded into the back end of a website.\u201d<\/p>\n
\n\tWalmart pushed back, with Dan Bartlett, executive vice president, corporate affairs, reminding everyone: \u201cA patent describes an invention and potential capabilities. It does not mean that Walmart has deployed a capability, used it with customers or decided to do so in the future. Those conclusions require evidence beyond a patent.\u201d<\/p>\n
\n\tAnd John Furner, president and CEO of Walmart, has vowed to stick to its pricing practices.<\/p>\n
\n\t\u201cWe don\u2019t set different prices based on who you are or the time of day, and we won\u2019t,\u201d he said last month. \u201cYour income, shopping history, urgency or what we think you could pay won\u2019t change the price. We\u2019ll hold our shopping tools to the same promise.<\/p>\n
\n\t\u201cWe won\u2019t use the information you share with us on [AI shopping agent] Sparky or otherwise to raise your price or hide lower-priced options that meet your needs,\u201d he said.<\/p>\n
\t\tTaken All Together\t<\/p>\n
\n\tThe tools to build a new future exist or are being made today. <\/p>\n
\n\tGuessing exactly what they will be used to build \u2014 or will build themselves \u2014 is a fool\u2019s errand. <\/p>\n
\n\tFashion, retail, the consumer, everything will be touched. <\/p>\n
\n\tPeople weaving in and out between all the change will have to decide just what these new powers are, how they can and should be put to work and where they themselves fit into it all. <\/p>\n
\n\tThe surprise ending might be that, just as computers become more able to think, it\u2019s becoming more important for flesh and blood people to take it in and think about it all themselves. <\/p>\n
#Transforming #Fashion #Opportunities #Challenges #Ahead<\/p>\n","protected":false},"excerpt":{"rendered":"
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