How will digital twins and AI transform the luxury supply chain? According to Global Market Estimates, the global digital twin market in fashion and luxury goods is on an impressive trajectory, with an expected growth rate of 10.5% CAGR from 2023 to 2028. This surge is no surprise as luxury brands seek innovative solutions to maintain their edge in a rapidly evolving industry. Digital twins—virtual models that provide real-time or near-real-time simulations of physical entities—are at the forefront of this transformation, offering unprecedented opportunities for brands to streamline operations, enhance visibility, and achieve new levels of efficiency.
In the luxury sector, where the highest standards of craftsmanship and quality are non-negotiable, integrating digital twins and AI into supply chains is not just a trend; it’s a necessity. These technologies offer a path to address some of the industry’s most pressing challenges: outdated manufacturing systems, unresponsive supply chains, and fragmented production processes. By adopting AI-enhanced digital twins, brands can unlock a range of benefits that extend across the entire value chain.
One of the most significant advantages of digital twins is their ability to provide a comprehensive, real-time view of factory processes. This visibility allows brands to identify inefficiencies and optimize production before issues arise. For example, a digital twin can simulate different manufacturing scenarios, helping streamline fragmented production lines and ensure that every step of the process operates at peak efficiency. By applying AI-driven forecasting to supply chain management, brands can reduce errors by up to 50%, according to McKinsey, further enhancing operational efficiency.
However, the potential of digital twins extends beyond manufacturing. AI-enhanced intelligent inventory management and warehousing systems are revolutionizing how brands manage their stock. With real-time data, brands can adjust manufacturing processes on the fly, more effectively manage deliveries and timelines, and ensure that inventory levels are optimized across all sales points. This level of control improves the customer experience by ensuring products are available when and where they’re needed, but it also supports sustainability goals by reducing waste and preventing overproduction. Luxury brands are under increasing pressure to meet sustainability targets and maintain their reputation for quality and exclusivity. Digital twins offer luxury brands a powerful tool to meet sustainability targets by providing a real-time picture of global inventory levels, reducing waste, and ensuring production aligns with actual demand.
“These technologies are applicable throughout the whole value chain,” says Demircan Erdogan, Head of Luxury, Fashion and Retail at Mesmerise. “If you ask me what I see in five or ten years, brands that succeed will be those who can integrate the pipeline and the technologies and completely make that transformation.”
The ability to preemptively address potential manufacturing problems or delays through AI-enhanced digital twins is a game-changer for the industry. By leveraging these tools, luxury brands can ensure that their supply chains are agile, responsive, and resilient—qualities that are increasingly essential in today’s fast-paced market. Integrating AI and digital twins into the luxury fashion supply chain is not just about keeping up with technological advancements—it’s about staying ahead. These innovations offer the transparency, agility, and sustainability critical to maintaining today’s highest standards of craftsmanship and quality. As the luxury industry continues to evolve, brands that embrace these technologies will be best positioned to lead the way, setting new benchmarks for efficiency and excellence.
Ready to elevate your luxury brand? Mesmerise combines advanced technological mastery with design thinking and luxury expertise. We understand that adopting AI and XR solutions is complex. With our market intelligence reports, technology showcases, and more, we’ll share our expertise and keep you ahead of the curve. Contact us to discover how our solutions can transform your business and give you and your firm a competitive edge.
