Not just limited to the electronics industry, we have seen a slow emergence of the Internet of Things (IoT) in the apparel industry as forward-thinking companies keen to innovate and stay ahead of the curve invest in the development of smart clothing and textiles.
Defined as “physical objects with sensors, processing ability, software, and other technologies that connect and exchange data with other devices and systems over the Internet or other communications networks” it is hard to imagine what role IoT has to play in clothing. Yet we’ve seen smart wearables, smart shoes and smart textiles developed in recent years, but the uptake is slow. IoT adopters in retail and apparel include Amazon, Auchan, Ikea, JD.com, Nike Inc, and Rewe.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataAdoption of innovation in IoT
Nike Inc designed and launched a pair of self-lacing trainers that adapt to the shape of a wearer’s foot and can be controlled via a smartphone. When the shoe is placed on the foot, a custom motor senses the required fit and adjusts to the foot. Wearers can customise settings for when they’d like the shoe to loosen or tighten. The concept is based on research demonstrating that feet swell when playing sports.
The app also allows users to customise LED colours on the shoe, each representing a level of tightness.
Cyrcadia Health launched the iTBra which aims to alert women of early signs of breast cancer. Upon wearing the bra for up to 24 hours, it assesses breast wellness. As breast cancer cells generate heat, the bra detects cell temperature and transmits data to a real-time database. Any abnormal reading sends the user and their physician an alert via a smartphone app.
Health appears to be a running theme with IoT in clothing. Sensoria Fitness launched a line of workout gear that tracks health and performance capabilities and reports the metrics to a smartphone app.
While Tommy Hilfiger has embedded IoT into the casual wear of its Tommy Jeans Xplore line.
In textiles, user-controlled colour-changing fabric called ChroMorphous can change colour with temperature changes and can be modified accordingly.
IoT in the supply chain
According to a recent report by Global Data, ‘Internet of Things in Retail and Apparel’, technology that can move items in the supply chain with minimal human intervention is also becoming increasingly popular with retailers.
“Automating the supply chain and minimizing labour can bring major efficiencies. This area is becoming important as retail sales increasingly bypass stores and wholesale and go directly to consumers,” the report reads.
“Smart shelves, cameras, and radio frequency identification (RFID) chips on products in stores or warehouses help update retail item inventory records instantly. They also enable faster coordination across retailers for inventory stock replenishment.”
According to the National Retail Federation (NRF), 8% of consumer goods sold in the US are returned annually, equivalent to $260bn of items. IoT can be used to diagnose product issues in transit, thereby significantly reducing the possibility of returns and associated costs for retailers.
“Diagnosing supply chain problems remotely favours both retailers and customers as retailers can minimise cost and reduce the burden on their supply chains while keeping customers content,” GlobalData’s report reads.
For example, IoT delivery start-up Living Packets packages items in bags with automatic locks and interior sensors that monitor temperature, weight, humidity, and shock to prevent contents from getting damaged. If items have been tampered with, both the company and sender receive an alert. GPS tracking is also used to monitor fleet transporting products to prevent cargo theft and provide visibility of the inventory in transit.
Capitalising on the retail shift
IoT appears to have been easier to adopt in the retail industry, with companies keen to capitalise on the shift to online shopping amid the Covid-19 outbreak.
The pandemic accelerated the roll-out of interactive web pages, apps, and new creative product launches to maintain customer interest and improve retention. In fact, the adoption of IoT in retail has taken place in a myriad of ways.
Athleisurewear brand Lululemon is one such adopter. The retailer, which acquired fitness tech start-up Mirror in 2020, has placed the power of stock inventory management in its customers’ hands. Instead of asking a store associate for support, customers scan a barcode on the item’s tag with the Lululemon app. This redirects customers to the product page on the online store. It then runs real-time inventory to check stock across all of its local stores, sorted by proximity.
According to GlobalData estimates, the global IoT in retail market will be worth US$25.6bn in 2025, up from $19.3bn in 2020, having grown at a compound annual growth rate (CAGR) of 5.8%.
Nikki Baird, vice president of strategy for US retail technology solutions firm Aptos, tells Just Style they are seeing the most demand for IoT around omnichannel.
“From mid-2020 to mid-2022 our customers’ omnichannel businesses and the amount of revenue they were generating or buying from home to ship to store doubled in two years and at the same time the online business was growing outrageously high. There’s a lot of experimenting going on – that’s what we’re seeing from our customers.”
An industry behind the times?
Yet as the report points out, IoT adoption in retail is slower than in other industries as its technology is often adopted within the bounds of retail supply chain analytics or personalisation, which account for a small part of the overall retail picture. And in clothing, the adoption of IoT has failed to make it into the mainstream.
Edwin Keh, CEO at the Hong Kong Research Institute of Textiles and Apparel (HKRITA), believes IoT is a much talked about subject with limited adoption.
“The main application that I see is with consumer facing applications. The pandemic has pushed a lot of tech into stores and with customer interface. Contactless purchase in stores, customer service online, predictive tools have all made inroads during these past few years. Since market turbulences have made a lot of legacy regression analysis more inaccurate and a poor predictor of future preferences, a lot more attention has been paid to real time of forward looking tools. IoT is the big enabler here.
He explains: In the supply chain, there is more use of IoT to track production, improve transparency, and reduce lead times. However, it seems that there are still lots of work and opportunities here. Supply chains still seem to be behind the times in adoption of new tools in general. The big drivers here for future adoption are if IoT can accelerate deliveries, reduce inventory risks, increase agility, and drive down costs.”
The future of IoT in retail and apparel
As for whether there is a promising future for IoT in clothing and retail, the jury appears to still be out.
In retail in particular, RFID has become an increasingly popular tool to monitor stock levels, but Baird says their customers are still extremely divided over how much of a priority it is.
“There are the evangelists who say we didn’t think there was a business case but we did a trial and now we can’t go back to the time of not having the level of visibility that article tagging gives us.
“The biggest barrier is not the tag costs, it’s the reader cost, especially in the place you need it the most which is in the store. You need full coverage – it’s not enough to have a few hand-helds.
“I thought there was a great business case for apparel with RFID but there is a slowness in terms of the take-off for that – it’s a paradigm shift in the way you think – retailers haven’t been very good at making that shift.
“We’ll chip away at the nay-sayers and get there. But we’re talking about ten years before the shift really happens.”
Despite this, GlobalData’s report suggests IoT is a technology trend in retail that is here to stay, particularly around M&A.
“There is an opportunity for major retail and apparel players to acquire key IoT software to bolster their position in the tech space,” it says.
In March 2019, TokenPay Swiss acquired intimate and swimwear ecommerce group Naked Brand Group, while in February of the same year, KBS Fashion bought Tribe Private for an undisclosed sum.
GlobalData offers a forward-looking timeline for the future of IoT in retail and apparel:
2022 – IoT-related supply chain and chip manufacturing will become more flexible and robust.
2023 – Industrial IoT connections will overtake consumer ones by 2023, according to GSMA.
2025 – Near ubiquitous connectivity for IoT devices lowers the cost of operation to below 1c per day. The number of IoT devices is expected to reach 25.1 billion, according to GSMA. IoT will be the driving force for semiconductor companies.
2030 – The use of AR and VR in IoT will be pervasive.
2035 – There will be one trillion IoT devices, according to predictions by Arm.
