Why are fashion brands investing in martech stacks?

The fashion retail industry is undergoing a massive transformation, driven by tech-first innovations that enhance personalisation, improve customer experiences, and streamline operations. AI is being adopted for product design and trend analysis. Martech stack is being implemented to refine audience targeting, optimise campaign performance and drive better omnichannel experiences. On the backend, technology is being used heavily for demand forecasting, stock optimisation and customer retention strategies.

Fashion brands are also leveraging AI-powered chatbots and virtual stylists to offer real-time assistance, improving customer engagement and conversion rates. Additionally, predictive analytics is enabling brands to anticipate consumer preferences, helping them create hyper-personalised marketing campaigns.

Social commerce and influencer marketing, powered by data-driven insights, are further shaping purchase decisions. With martech solutions integrating seamlessly with CRM platforms, brands can now offer loyalty programs and tailor promotions based on individual shopping behaviours. Moreover, sustainability is a growing focus, with AI and martech being used to optimise supply chains, reduce waste, and ensure ethical sourcing.

77% of consumers in India prefer to shop with a brand or retailer that has both a physical and online store, states a Wunderman Thompson report. It highlights the growing importance of 'phygital' retail experiences. Consumers expect seamless transitions between online browsing and offline shopping, making omnichannel strategies a necessity rather than a luxury.

Fashion brands are responding by integrating AI-powered recommendation engines, click-and-collect options, and in-store digital kiosks that connect to their e-commerce platforms. It helps brands achieve higher customer retention and reduced cart abandonment, as shoppers are more likely to find what they want — whether online or in-store — without friction.

Fashion retailers like Pantaloon, Shoppers Stop, Lifestyle, Max Fashion, Westside, Reliance Trends and more often nudge consumers to check for more styles and sizes online — to ensure they don’t leave the stores empty-handed. This ‘endless aisle’ approach ensures that customers can access a wider selection, reducing lost sales due to stock limitations.

In sync with industry trends, Indian fabric and menswear retailer Raymond has been spending heavily on AI. The brand has been leveraging martech tools and technologies to enhance customer engagement, improve supply chain efficiency, and refine pricing strategies.

“The end objectives are defined based on what we are solving for,” shares Ravi Hudda, Group Chief Digital and Information Officer, Raymond. He adds that the brand has a fully integrated Rewards CRM program to drive omnichannel experiences across stores and online.

The brand actively uses AI-driven insights to improve customer experience, refine recommendations, and manage inventory more efficiently. The integration of data across multiple channels helps the brand understand consumer preferences, streamline marketing efforts, enhance operations, and support customer engagement and business growth.

“So long we see acceleration and margin improvement, the solution is working as per goals. However, the biggest measure of success, mostly with AI-driven solutions including Agentic AI, is the adoption of technology,” says Hudda, highlighting the importance of user acceptance and seamless implementation.

For BIBA, an Indian womenswear brand, the focus is on leveraging a suite of martech tools to create seamless omnichannel experiences. It helps the brand ensure a cohesive customer journey across online and offline touchpoints.

Other key areas where the brand uses martech tools include enhancing audience targeting, automating internal processes, delivering personalised customer communications, gaining deeper insights into customer preferences, tracking consumer interactions, optimising campaigns, driving engagement and gauging campaign performance across digital channels.

The biggest advantage of integrating martech tools in marketing strategies remains measurability. “We focus on key performance indicators such as customer engagement metrics, sales & conversion rates, repeat purchases & customer loyalty, omnichannel performance, and operational efficiency that reflect both business growth and customer satisfaction. Ultimately, we measure success by how effortlessly our customers shop with us, whether online, in-store, or through a blend of both,” shares Ekta Dutta, Head of Marketing, BIBA.

She adds to the list of metrics and methods, “By analysing online and offline sales influenced by tech-driven touchpoints, we measure how effectively innovations translate into purchases. Loyalty program participation, repeat orders, and engagement with personalised offers help us assess long-term customer retention.”

Fashion brands across segments are increasingly experimenting with AI and GenAI to create seamless omnichannel experiences, making the shopping experience more personal and brands more endearing to customers. Vijay Shenoy, Head - Strategy & Consulting, Langoor, lists some specific use-case scenarios: Virtual try-on experiences, recommendations based on consumers’ past purchases and current social trends, and AI chatbots.

He explains, “Some of the key pain points of fashion retail have been product returns and customer retention. Hence, while tech solutions such as personalised product try-ons and 3D product visualisation have enabled lower Return Rates, some of the martech solutions have focused on increasing Customer Engagement and Retention Rates.”

Beyond innovation, what matters for the brand is the impact and its measurements. It’s the reduction in Customer Acquisition Cost (CAC) and increased Customer Acquisition Cost (CAC) that truly illustrates the success of tech-enabled solutions. These are directly impacted by how innovations are helping sell inventory efficiently and if stocks are being replaced in time to match demands, Shenoy explains.

As technology continues to reshape fashion retail, its true value lies in measurable impact — driving efficiency, enhancing customer experiences, and delivering tangible business results.