Key Insights
Essential data points from our research
The global digital fashion market is expected to reach $4.8 billion by 2031, growing at a CAGR of 26.4%
Morgan Stanley estimates that virtual fashion could provide the luxury goods industry with $50 billion in extra revenue by 2030
The digital fashion industry was valued at approximately $119.52 million in 2022
47% of Gen Z users say they use digital fashion to express their identity more freely than in the physical world
70% of Gen Z consumers say they borrow ideas from their physical selves for their avatars
Over 50% of Roblox users change their avatar's clothing at least once a week
Producing a digital garment emits 97% less CO2 than producing a physical garment
Digital fashion production saves on average 3300 liters of water per item compared to physical production
Transitioning to digital sampling reduces carbon footprints by 30% for fashion brands
Roblox has over 66 million daily active users, most of whom customize avatars daily
Decentraland hosted the first Metaverse Fashion Week in 2022 with over 60 brands participating
Fortnite's collaboration with Balenciaga brought high fashion to 350 million registered accounts
Returns in e-commerce can be reduced by up to 40% using 3D visualization and virtual try-on technology
71% of consumers say they would shop more often if they used AR
Virtual Try-On (VTO) technology can increase conversion rates by 250%
Consumer Behavior
- 47% of Gen Z users say they use digital fashion to express their identity more freely than in the physical world
- 70% of Gen Z consumers say they borrow ideas from their physical selves for their avatars
- Over 50% of Roblox users change their avatar's clothing at least once a week
- 62% of Gen Z consumers state they successfully look for items in the digital world that they can purchase in the physical world
- 50% of consumers are interested in purchasing a digital skin for their avatar
- 85% of Gen Z gamers believe that style is important for their avatar
- Three in four Gen Z consumers say they would spend money on digital fashion
- 60% of consumers prefer to act as their "ideal self" in virtual environments rather than their real self
- 72% of consumers say that seeing a digital version of a product on themselves increases their likelihood of purchase
- 54% of people believe their digital avatar should be exclusively inclusive and diverse
- A survey showed that 46% of social media users would buy a digital garment to post on Instagram
- 39% of consumers consider exclusivity as the main driver for buying Fashion NFTs
- Customers who engage with AR are 3 times more likely to convert than those who do not
- 58% of respondents in a Obsess survey said they have already shopped in a virtual store
- Gen Alpha and Gen Z spend an average of 8 hours a day online, driving the need for digital appearance
- 42% of consumers say they would pay for personalized recommendations for their digital avatars
- 37% of gamers have purchased digital clothing for the sole purpose of "collecting"
- Consumers are willing to pay up to 20% more for a product if they can experience it through AR first
- 88% of consumers want to know if a brand is sustainable before buying physically or digitally
- Half of Gen Z consumers consider their digital identity to be an extension of their physical reality
Interpretation
Digital fashion has shifted from play to identity-driven commerce, with Gen Z treating avatars as extensions of themselves, changing looks weekly, borrowing real-world style and eagerly paying for exclusive, collectible, personalized and sustainable digital items that convert even more when paired with AR and virtual try-ons, so brands that build immersive, shoppable, inclusive experiences will capture attention and wallets.
Environmental Impact
- Producing a digital garment emits 97% less CO2 than producing a physical garment
- Digital fashion production saves on average 3300 liters of water per item compared to physical production
- Transitioning to digital sampling reduces carbon footprints by 30% for fashion brands
- Digital-only collections eliminate 100% of the textile waste associated with physical manufacturing
- Using 3D design software like CLO3D can reduce sample lead time by 90%
- 1 in 10 people admit to buying clothes solely for social media photos and then returning them, a waste problem digital fashion solves
- The fashion industry contributes 10% of global greenhouse gases, a figure digital fashion aims to reduce significantly
- Digital sampling reduces the number of physical prototypes by up to 65%
- A digital t-shirt leaves a carbon footprint of roughly 0.26 kg CO2 compared to 7.8 kg for a physical one
- Virtual showrooms reduce the need for travel and shipping samples, cutting CO2 emissions by up to 40%
- 85% of textiles go to the dump each year; digital fashion provides a zero-waste alternative for trend-based wear
- Digital clothes can replace the "wear once" culture, potentially reducing total fashion industry emissions by 20%
- 60% less energy is consumed during the creation of a digital garment collection versus a physical one
- Digital prototyping saves approximately 70.000 tons of fabric waste annually for major retailers who adopt it
- Replacing physical lookbooks with digital renders saves tons of paper and ink chemicals annually
- Tommy Hilfiger's switch to 100% 3D design aims to significantly lower the brand's environmental impact
- Digital-only fashion houses report a near-zero water footprint for their entire inventory
- By 2030, usage of digital twins in manufacturing could reduce overall material waste by 15%
- Avoiding physical photoshoots through digital rendering saves significant travel-related carbon emissions
- Digital repair and upcycling of NFTs entails 0% material cost and 0% physical waste
Interpretation
Think of digital fashion as the industry’s emergency brake and software upgrade rolled into one, because by cutting garment CO2 by up to 97%, saving thousands of liters of water per item, reducing sampling carbon footprints by about 30% and prototypes by roughly 65%, shrinking sample lead times by 90%, eliminating textile waste in digital-only collections, stopping buy-for-Instagram returns and slashing energy, travel and paper use, it offers a stylish, practical way to dramatically shrink fashion’s outsized share of global emissions.
Market Economics
- The global digital fashion market is expected to reach $4.8 billion by 2031, growing at a CAGR of 26.4%
- Morgan Stanley estimates that virtual fashion could provide the luxury goods industry with $50 billion in extra revenue by 2030
- The digital fashion industry was valued at approximately $119.52 million in 2022
- Sales of "skins" in gaming reached $40 billion annually as early as 2020
- RTFKT Studios was acquired by Nike in 2021, a move highlighting the high valuation of digital sneaker culture estimates suggest the deal was undisclosed but highly lucrative
- Dolce & Gabbana sold a nine-piece collection of NFTs for $6 million in 2021
- The Fabricant sold the first digital-only dress "Iridescence" for $9,500 over blockchain in 2019
- Gucci sold a virtual version of its Dionysus bag on Roblox for roughly $4,115, which was more than the physical bag's retail price
- The global metaverse market size, largely driven by fashion and retail, is predicted to reach $678.8 billion by 2030
- Adidas earned over $22 million from its first NFT drop "Into the Metaverse" within hours
- 79% of consumers making purchases in the metaverse have bought digital fashion items
- The average price of a digital fashion NFT in 2021 was significantly higher than traditional fast fashion items, often exceeding hundreds of dollars
- Fashion NFTs generated roughly $153 million in trading volume in Q1 2022 alone
- The compound annual growth rate (CAGR) of the virtual fitting room market is projected at 24.1% through 2028
- Luxury brands could see digital asset sales account for 10% of their revenues by 2030
- Nike has generated over $185 million in revenue from NFT sales as of August 2022
- The "skins" market in video games is projected to reach $50 billion by 2025
- In 2021, venture capital firms invested over $130 million in digital prospection and fashion startups
- 45% of luxury goods sales are expected to be influenced by the metaverse and digital interaction by 2025
- The virtual goods economy is estimated to be worth over $100 billion globally
Interpretation
Digital fashion is no fad: it's turning pixels into billions, as gaming skins, luxury NFT drops and metaverse commerce prove virtual garments can command luxury prices, generate massive revenues for brands and investors, and fundamentally reshape where and how consumers buy style.
Retail Tech & Strategy
- Returns in e-commerce can be reduced by up to 40% using 3D visualization and virtual try-on technology
- 71% of consumers say they would shop more often if they used AR
- Virtual Try-On (VTO) technology can increase conversion rates by 250%
- Gucci was the first major luxury brand to release AR try-on for sneakers on its app in 2019
- 93% of Snapchatters are interested in using AR for shopping
- Brands using 3D viewing see a 94% uplift in conversion compared to 2D imagery
- Walmart acquired virtual clothing try-on startup Zeekit to enhance user experience
- Amazon Fashion introduced "Virtual Try-On for Shoes" to improve mobile shopping conversion
- AI algorithms can now predict fashion trends with 80% accuracy, aiding digital design
- Burberry uses digital twins to manage stock and supply chain efficacy
- 61% of shoppers prefer checking products via AR/VR capabilities over visiting a physical store
- Stitch Fix uses algorithms to generate over 30 billion outfit combinations digitally
- LVMH launched an "LVMH Skin" program to facilitate scientific skin modeling for digital avatars
- Tommy Hilfiger committed to 100% digital design workflow by 2022 to streamline supply chains
- 40% of fashion executives planned to pilot NFT strategies in 2022
- Adidas launched a dedicated "Virtual Gear" line compatible with different avatars
- Farfetch's Dream Assembly Base camp accelerates startups specifically in digital fashion tech
- Yoox Net-A-Porter developed a digital ID for products to track lifecycle and authenticity
- Specsavers reports a 42% increase in online sales after implementing virtual frame try-on
- Clo3D software is now used by over 500 major fashion brands to replace physical pattern making
Interpretation
From Gucci’s 2019 AR sneaker try-on to Amazon and Walmart’s investments, the surge of 3D visualization, virtual try-on and AI-driven design is quietly upending fashion retail: it can cut returns by up to 40 percent, boost conversion rates by as much as 250 percent while 3D viewing alone yields about a 94 percent uplift over 2D, increase online sales for categories like eyewear by roughly 42 percent, entice 71 percent of shoppers to shop more and 93 percent of Snapchatters to try AR, and has pushed brands from Tommy Hilfiger and Burberry to LVMH, Adidas and startup ecosystems backed by Farfetch and Yoox Net-A-Porter to adopt digital twins, virtual gear, product IDs and NFT experiments to speed design, secure authenticity, optimize supply chains and predict trends with about 80 percent accuracy.
Virtual Platforms
- Roblox has over 66 million daily active users, most of whom customize avatars daily
- Decentraland hosted the first Metaverse Fashion Week in 2022 with over 60 brands participating
- Fortnite's collaboration with Balenciaga brought high fashion to 350 million registered accounts
- ZEPETO sold over 2 billion virtual fashion items by 2021
- Roughly 25 million virtual items were created by users on Roblox in 2021
- 11.5 million creators designed virtual clothing on Roblox in 2022
- The Sandbox saw $2.8 million in land sales in a single week, much of it for retail and fashion development
- Nike's "Nikeland" on Roblox attracted 7 million visitors in its first five months
- Ready Player Me has partnered with over 3,000 apps and games to provide interoperable fashion avatars
- 108,000 unique visitors attended the first Metaverse Fashion Week in Decentraland
- League of Legends generated $1.75 billion in revenue in 2020, largely driven by skin sales
- Second Life, an early pioneer, still sees $500 million in annual GDP mostly from user-created content including fashion
- Hugo Boss garnered 3.1 million visitors for its Metaverse Fashion Week pavilion
- The DressX app allows integration of digital clothes into Zoom and Google Meet, expanding platforms beyond gaming
- Spatial.io has seen varying engagement times of up to 40 minutes for fashion gallery exhibitions
- Farfetch piloted digital fashion pre-orders on their platform for virtual try-on
- Snap’s Bitmoji fashion partnerships have been used by over 200 million daily users
- Artisant is the first Web3 platform that successfully distributed over 10,000 wearable NFTs for avatars
- Over 21,000 NFTs were claimed during the Metaverse Fashion Week 2022
- Drest, a mobile fashion styling game, has partnered with over 250 luxury brands
Interpretation
These statistics show digital fashion has leapt from novelty to a major commercial and cultural force, with platforms like Roblox’s 66 million daily users, Fortnite’s Balenciaga collaboration reaching 350 million accounts, ZEPETO’s two billion item sales, and booming creator economies and brand partnerships proving that interoperable avatars and virtual goods are reshaping how people shop and express themselves—effectively turning pixels into profit.
References
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