Shared todayArtificial Intelligence SeriesIn-depth Research Report:Artificial Intelligence Topic: Diversity and Artificial Intelligence in the Fashion Industry Beyond Boundaries 2023
Report produced by foreword).
Report total: 88 pages.
Featured Report**: The School of Artificial Intelligence
Throughout its history, the fashion industry has championed a strict ideal of beauty. In recent years, the industry has faced increasing scrutiny, and this homogeneous illustration echoes the changing needs of a wider society. Despite significant progress in some areas, the industry's journey to inclusion is still ongoing.
Many well-known brands are taking concrete steps to strengthen diversity and inclusion in governance, demonstrating their commitment to systemic change within the industry. Almost 82% of the companies we analyzed have appointed a Chief Diversity Officer, demonstrating their top-down commitment to driving change within the company. Nearly 9 out of 10 companies have already released specific strategies for DE, an increase of 35 percentage points compared to 2022. In addition, nearly two-thirds of analytics firms have developed a tangible set of KPLS with precise numerical targets and time frames.
The fashion industry is also actively redefining its marketing strategies in response to the changing expectations of a socially conscious consumer base. About 91% of fashion brands, including luxury brands, have begun to use models from different ethnic backgrounds in their products**, marking a departure from the homogeneous depiction of beauty in the industry's history.
Hiring practices in the fashion industry are at a critical juncture. While 48% of brands already offer scholarships or apprenticeships to underrepresented groups to empower marginalized groups, the traditional approach is to only recruit graduates of prestigious fashion schools, while the industry's focus recognises the critical role of recruitment in DE1 efforts, and industry participants must expand their hiring to welcome creative talent from diverse academic, ethnic, and socioeconomic backgrounds.
For consumers, significant inclusivity challenges remanufacturing. Despite progress, the availability of sizing and fitting remains a pressing issue, with 37% of shoppers having a hard time finding the right size when shopping for fashion. 4Inclusive efforts should go beyond accommodating different body types, including gender-neutral, age-inclusive, and culturally inclusive clothing types, that resonate with a wide range of personal preferences and identities.
Prioritizing DE [is not just a matter of moral responsibility, our research highlights that it can also translate into enhanced business outcomes5 percent increase in employee happiness when their immediate boss is committed to DEL.5 At the same time, when diverse employees' day-to-day experiences are unbiased, their propensity to stay with a company rises by 47 percentage points, reducing friction and generating significant savings.
Fashion companies can benefit from the link between diversity and innovation. As the BCG Henderson Institute confirms, diversity precedes innovation, not the other way around. A diverse team empowered to express their unique perspectives and demonstrate unparalleled creativity. Companies with above-average diversity scores earn an average of 45% from innovation, while companies with lower diversity earn 26% from innovation.
In recent years, there have been public uprisings against the general lack of diversity and representation. The fashion industry has not been spared this call for inclusivity, with leading brands making tangible progress in building strong governance structures and making marketing efforts more inclusive. Of the 56 leading fashion companies we analyzed, 86% have already introduced a diversity strategy into their organization, and two-thirds have clear diversity goals. However, the fashion industry's journey towards full inclusion remains extensive, especially in customer-centric areas, where body-inclusive and accessible clothing options remain limited.
Our external benchmarking study assessed the key diversity characteristics of 56 top fashion companies, including 37 in Europe, 17 in the U.S. and 2 in Asia, across four dimensions: governance, customer perspective, marketing and recruitment. Since our study only focuses on visible and quantifiable metrics, it is crucial to highlight two limitations of this approach.
First of all, the samples used cannot be considered representative of the fashion industry as a whole. We only analyze market leaders whose DEI journeys may be more advanced than the average company. Second, the findings are limited to what is visible and quantifiable from an external perspective, which may not always reflect the complexity of diversity, equity, and inclusion topics, as well as the overall scope of a company's efforts, such as internal initiatives that are not publicly communicated.
By the second quarter of 2023, 86% of the companies we analyzed had published specific strategies for diversity, equity, and inclusion, including an assessment of current DEI efforts, definition of focus areas, and implementation plans. This reflects a 35 percentage point increase relative to 2022, with the fashion industry becoming the leader of DEI relative to other adjacent industries such as beauty (76%), consumer goods and groceries (77%) and food (77%).
Retail (79%)" In this panorama, prominent brands include Kering, Lulu Lemon, PVH and Burberry. Kering's comprehensive approach to DEI, for example, includes external efforts, such as Kering** and the women's movement, as well as internal actions, such as the Giving Back Program. Kering also promotes DEI within its fashion house, showcasing it through an annual impact report related to the Gucci Equilibrium initiative.
Together with IDEA, lululemon launched the Here To Be initiative to promote equality through campaigns and actions. In addition, lululemon implemented actions aimed directly at customers, intentionally making everyone feel welcome in the store, placing positive messages in fitting rooms, and promoting diversity and inclusion.
These initiatives have been very successful. In 2022, lululemon exceeded expectations, reaching 40% of its retail store diversity and approaching its 30% target for directors and regional managers. The company also achieved 100% pay equity among the global population for the sixth year in a row, ranking second among racial and ethnic groups in the United States.
Report total: 88 pages.
Featured Report**: The School of Artificial Intelligence