In recent years, the fashion industry has stepped into the digital era following the trend of the times. As demographics change, the powerhouse of consumption has slowly shifted into Gen Z. Among the fashion brands involved in the NFT space, there are established fashion companies as well as emerging projects that specialize in digital fashion. Possible ways of integrating fashion with NFT are limitless. From the basic combination of NFT IP with fashion to the conversion of virtual brands into reality, NFT is subtly reshaping the current economic model.
There are currently four main ways of NFT utilization in the fashion industry:
When it comes to the integration of NFT and fashion, four metrics must be mentioned: identity, properties, interactivity, and scalability. Collectively, these metrics distinguish the value and the way Web3 and Web2 fashion industry companies view NFT.
The fashion industry of Web3 attaches great importance to NFT in sales, display, collaboration, and application. For instance, projects aggregate fans through digital IP, bring together mutual participants with DAO, and empower its application in GameFi as well as the metaverse by airdropping digital fashion. In addition, rarity and the secondary market have increased the liquidity of the clothing. Therefore, physical and offline businesses merely serve as icing on the cake and are no longer the key to success.
Most Web2 companies, on the other hand, only see NFT as a tool. Essentially, their industry chain—from production, and distribution to feedback—is based on physical sales. In this case, NFT is used as marketing hype to boost new consumer traffic and modernize brand identity. From this perspective, brand exposure in the metaverse becomes a new marketing channel. The underlying concept is to maintain brand exposure and create new revenue streams through the NFT.
Compared to traditional fashion and luxury brands, Web3 is very different in terms of cultural communication.
While traditional fashion brands rely on annual fashion shows and media news to convey values to the public in a top-down manner, Web3's communication approach tends to be decentralized and community-based. That is why BAYC and Azuki's culture was formed bottom-up and full of rebellion and symbols that align with crypto's native culture.
Fashion that is derived from the nature of NFT is more in line with people's consensus on Web3. In contrast, the "traditional fashion + NFT" model seems relatively outdated and foreign.
Without destruction, there can be no construction. The new fashion is never grafted on from classical aesthetics, and there is often a sense of being "nonmainstream" and "rebellion" in the early stage, just as Beethoven and Van Gogh did in their respective areas and eras.
The streetwear culture represented by BAYC and Azuki is expanding from Web3 to Web2. These are often done through offline events and streetwear collaborations. Thanks to community culture, fans of these brands are more loyal than usual customers which traditional fashion brands lack, and is the primary factor for both parties to appear distant even though they are involved in the same industry.
Currently, it is common to see tech companies whose specialization is in the digital fashion space warming up the market by issuing NFTs and collaborating with other industries so as to generate new opportunities for their brands.
Founded in 2019, RTFKT takes its name from the pronunciation of "artifact" and was acquired by Nike last December. Following the acquisition, the mysterious MNLTH boxes were airdropped to Clone X holders. Last Friday, it was announced that holders of RTFKT's MNLTH have a chance to get Nike's Cryptokicks which have been revealed to be customizable sneakers. Since its launch, the NFTs' floor price has stabilized at around 3.1 ETH after the initial upswing.
The rise of the metaverse and NFT has led to a new digital economy ecosystem where virtual experiences and interactive economies have become mainstream. A complete virtual identity can be expressed in a variety of ways, such as avatars, digital real estate, and clothing.
With the improved infrastructure of the metaverse and the development of avatars in online meetings, individuals are able to express themselves through digital characters and clothing by showcasing their outfits. Decentraland and other metaverse platforms have their own line of wearable and offer fashion pieces through collaborative projects.
Genies are valued at $1 billion after its fundraising in April. The platform enables users to create digital avatars and wearables. They may also monetize their IP accordingly.
Republiqe creates unique 3D digital clothing and products while partnering with brands to create custom digital avatars and models. Plus, the company's collaboration with gaming and virtual platforms allows avatars and players to be dressed according to their actual scales.
Many still remember Iridescence, the first digital-only dress to be sold in the blockchain world for $9,500 in 2019. The Fabricant, the company that created the dress, has just raised $14 million to focus on creating avatars. The Fabricant's positioning can be seen from the statement "always digital, never physical".
In addition, a number of well-known clothing studios have launched their own digital ready-to-wear brands. Take AuroBoros for example, the London-based studio launched an all-digital ready-to-wear collection at London Fashion Week and its Biomimicry collection are available on the Decentraland platform.
There are two main ways of integrating the physical and the virtual:
One is by purchasing reputable PFP NFTs and reselling them after recreation or redesigning. Li-Ning, for instance, released apparel and flash sales featuring BAYC #4102.
Another way is for customers to scan the barcode that comes with the physical apparel they bought to get a digital version. Brands like Overpriced have its hoodie priced at $26,000 on the NFT platform BlockParty.
Gucci was one of the pioneers to venture into NFT. Their first NFT collection was not based on fashion products but on a film inspired by their Aria collection with Alessandro Michele. The 4-minute video was sold at Christie's for $2.5 million.
Dolce & Gabbana had launched nine collections at the Venice Fashion Week with a total auction price of $5.56 million. In addition to the NFT, buyers received physical products and VIP access to D&G events. Besides, Dolce & Gabbana plans to launch a $10 million Culture Fund to promote NFT in the fashion industry.
Furthermore, digital fashion enjoys plenty of showcasing opportunities. With the spread of COVID-19, many fashion weeks have transitioned to online platforms, making NFT a new favorite at fashion weeks. Arianee and the Fédération de la Haute Couture et de la Mode have partnered up to create NFTs for participants to browse exclusive pieces of the Paris Fashion Week Menswear Spring-Summer 2022 and Haute Couture Week.
As of now, luxury brands possess the same position in the NFT world as they do in real life. Artistry, price, market orientation, etc.—whatever they appear to be in the real world, it's the same in Web3: luxurious, marketed to high-end consumers, highly artistic, etc.
The creative director of The Fabricant said that we are approaching the digital world and will no longer be shackled by the limitations of the physical space. The new system that we're about to embrace is much more similar to the innate abilities of humans— born of evolution rather than centralized power. What will a person become when he or she is freed from the physical body? What will we become when we can express ourselves through an endless supply of bits and bytes? We long to have a peek at the new world. Fortunately, the window to this new world is gradually taking shape, and the infinite potential of human beings is the driving force behind it all.
Your attitude and thoughts are what fashion is really about. People's consumption behavior and consumer psychology, in reality, will gradually transition horizontally to the Web3 domain. The pursuit of rarity and personalization has never stopped and will never stop. People's desire for self-expression, self-identity, and many other factors are making digital fashion increasingly important and its integration with NFT is merely a starting point.
Consensus is the foundation of Web3. Digital assets, NFTs, etc.— all work similarly and the consensus is why they exist in the first place. Nowadays, we're at Web2.5 witnessing the great transition. Economic drivers are losing momentum and the market is in desperate need of new stimulators.
Consensus is also the root of good brands and stories. Whether it is the involvement of traditional fashion companies in the virtual world or native fashion brands created by the digital industry, the key is to find a clear position in the industry. Whichever approach you're taking—virtual to physical, physical to virtual, all-virtual—a thorough understanding of the value of virtual is vital.