by “H&M is going to change from a fashion company to a data company,” and this seems to be the direction retail is heading in, largely shaped by the introduction of artificial intelligence (AI) into the sector, explained Alan Boehme, H&M’s CTO at as part of the talks taking place in Barcelona during Shoptalk Europe.
His advice to the industry: Data is everything today. We need to listen to the stories the data has to tell, not just support the story we want to tell.
Artificial intelligence, the third major revolution in retail
The three biggest technological revolutions of recent years are the Internet – the world’s most important technological revolution that has connected us all – the mobile phone – the portable computer that we all carry in our pockets – and artificial intelligence.
“These three innovations are and will continue to change everything about our daily lives, work, shopping and what we do. And that’s where we should focus our efforts, integrating those three things and what it’s going to do for us,” Boehme said.
Education would be the first step in the list of experts on how to integrate these innovations in the retail sector. He does not hesitate to point out that the second step is to understand that companies cannot do it alone: “You have to want to share information with others. The only way to make it work is if you have a lot of data. of us retailers have this data within the four walls of our business.”
You need education to develop
As he says about his more than 30 years of experience working on the digitization process of various companies, “technology is never the problem, it’s actually the easiest part. People are always the problem.”
“All of the support departments in the companies are set up to prevent changes, worrying about violating the policy,” he says, citing as an example his time at Coca Cola, a large company whose policies that often prevent the flow of information including internal data dates back 150 years. Coca-Cola’s main goal is to keep the recipe secret.
“It becomes a culture that takes a long time to change. And sometimes the best way to change things is to move things outside the company and run small pilot projects, almost undercover.” Once they start to bear fruit, you can start planting them before the culture slows them down, according to a tech expert.
It’s not just about working to change, it’s also about being ready to change
“Every company has its core values that it stays true to at all costs,” “but I think when you start looking for change, you have to want change,” he said.
He gives an example of how COS, one of the H&M brands, started thinking about how it could provide up-to-date inventory information online, how it would benefit employees and how it would change how it interacts with customers.
With a 60-day deadline, they then went to work researching existing technologies on the market to be able to formulate the most effective answers to these questions.
There are many opportunities in the supply chain
“When you talk about innovation, most people think you’re starting to do new things with data, that you have to start from scratch, but most of the time the answers are already there, it’s just about innovating and connecting the missing pieces,” he said.
So the H&M Group came up with the idea of offering smart fitting rooms that allow customers to order items without having to leave the fitting room. The mirrors recognize products by detecting item, size and color, and in a pilot project installed at a Cos store in Beverly Hills, they also offered personalized product and styling recommendations.
“When you walk through the door, the RFID readers are built into the ceiling. Each product knows where it needs to be when you pick it up and bring it to the fitting room. If it doesn’t fit, just touch the mirror in the fitting room and someone brings you the right size, the right clothes, and then we take the old clothes back to exactly where they belong,” he explains. About how to make the most of the alarm location technology present in every store, which the company turned into an innovative solution.
How to make the best use of customer data?
Fear of lack of privacy and security often affects trust in e-commerce as people are genuinely concerned about the fact that data scientists work with consumer information.
“At H&M, we have almost 200 million people in our loyalty program,” a figure that Boehme says translates into information you can’t get anywhere else. “We need to start educating and making people feel comfortable sharing, tearing down the walls that divide us.”
The amount of information available on the Internet today is overwhelming. All the more so a digitization expert will “learn to trust machines”, i.e. algorithms. “Let the data tell the story, and let the data tell their story. And don’t try, as we’ve done so far, to make the data justify the story you want to tell.”
“We need to understand that this drastic change in business people will shape the way we will have to start looking at the new world.”
He recalls how, speaking to a fashion company a few weeks ago, they described themselves as a social media company first and a fashion company second, due to the work they did with influencers which led him to invent social communication as a way of doing business.
“I think at H&M and other brands, we’re going to have to rethink where we are, how we fit into this new world and how data will impact the future,” in order to make further progress, Boehme said.
“We’re still halfway through that journey,” but from his experience in Silicon Valley, he says AI is the future because “they don’t invest money there in anything but AI.”
Therefore, “we need to understand that this drastic change in business people will shape the way we will have to start looking at the new world”, concluded H&M’s chief technology officer.
This article was originally published on FashionUnited.ES. Translation and editing from Spanish to English by Veerle Versteeg.
