Design Road mapping report

Design Roadmapping - Group 5 Loeke Molenaar - 4635493 Feline Hunink - 4300599 Ashni Shah - 4736818 Jan Schmidt - 4704436 Jordy Moll - 4613538 Maartje Hofker - 4270908

TABLE OF CONTENTS Introduction 04

9. References 40

1. Analysis 05

Appendix 42

2. Artificial Intelligence

08

3. Creative Trend Research 10 4. Chosen Direction

5. Future Visioning

6. Technology Scouting

7. Time Pacing

14

8. Roadmap

30

17 22 26

3

04

INTRODUCTION This report describes the process of creating a roadmap for new business development by Tommy Hilfiger focused on the specific product service market combination that includes the Artificial Intelligence (AI) technology.

During the process, market trends, user drives, business values and technology advancements are studied in order to map the value propositions needed to realise the roadmap.

The outcome of this project is a Tactical and Strategic roadmap and the report elaborates on how Tommy Hilfiger can arrive at the future vision described by the team. The future vision describes how Tommy Hilfiger can provide clothing which have an infinite lifecycle by being constructed from modules of smart materials while allowing for a large level of personalisation and always being in style. This report will serve as an argumentation for the decisions made by the team.

Chapter 1 Introduction

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1. ANALYSIS General introduction Tommy Hilfiger is a large designer brand, selling mainly clothing for adults and children. It is founded in 1985 and includes the brands Tommy Hilfiger and Hilfiger Denim. The main collections are Hilfiger Collection, Tommy Hilfiger Tailored, men’s, women’s and kids’ sportswear, denim, accessories, and footwear. In 2010, Tommy Hilfiger was acquired by PVH Corporation, which also owns Calvin Klein.

Sustainability within Tommy Hilfiger Diving deeper into the strategy of Tommy Hilfiger, it becomes clear that sustainability is highly valued within the company.

They stated the following on their website: “We believe that the future success of our business is dependent on bringing sustainable practices into all elements of our operations.

Our mission is to be one of the leading sustainable designer lifestyle brands through how we create our product, manage our operations and connect with our community and our stakeholders.” (Tommy Hilfiger, 2017) Tommy Hilfiger is planning on continuously reviewing their entire supply chain to see where possibilities lie in becoming as sustainable as possible. Currently, Tommy Hilfiger has done multiple things to become more sustainable. On their website, the following 7 achievements and goals within sustainability are to be found, amongst many other (see specifications in appendix 1) (Tommy Hilfiger, 2017):

1. Procure 100% of their cotton from more sustainable resources.

4 million pieces produced with organic cotton since 2012.

2. Take an active water stewardship role Collaboration with WWF since 2014 on preserving water resources.

3. Produce in facilities where water, energy and chemicals are sustainably managed.

25% of their denim products within the 2017 collection is developed within EIM Low Impact Process category.

4. Reduce greenhouse gas emissions.

80% reduction in samples at Showroom in Amsterdam thanks to digital showroom.

5. Reduce carton based packaging.

More than 50 tons of water saved by reducing size of hangtags.

6. Reduce plastic based packaging.

7. Recycle store, warehouse and office waste.

At the European headquarters, +/- 75% of waste is recycled, 25% is incinerated. 86% of non-wearable merchandise in Europe is repurposed/recycled.

06 Chapter 1

Target group Since mid 2016, Tommy Hilfiger started focusing more on millennials and tried to attract this new target group. They have done this by starting a collaboration with one of the biggest influencers of this time: Gigi Hadid. This collaboration worked so well, that it resulted in putting Tommy Hilfiger back on the map of big fashionable brands, their brand perception changed and their sales were increasing. Tommy Hilfiger decided to extend this collaboration in 2017 and add new influencers to the team like the Chainsmokers.

Since Tommy Hilfiger is already sustainable and has sustainable goals, extra revenue could be created when promoting the sustainability of their clothing and making sure the target group is fully aware. For that reason, in the early stages of value mapping, sustainability within fashion will be the focus point. As the process progresses, this vision will be specified. The target group of this focus will be generation Z, since they will have the same age then (see chapter 7 ‘Time pacing’) as the millennials have now (around 25 years old), and analysis of the target group shows that Gen-Z values sustainability more than previous generations (see fig. 1 and appendix 3 for detailed explanation).

07 Chapter 1

Fig. 1 - Persona

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2. ARTIFICIAL INTELLIGENCE The innovation team at Tommy Hilfiger is exploring ways in which Artificial Intelligence (hereinafter referred to as ‘AI’) can shape the future of their business. Learning about AI and its applications is important to create a better view of the possibilities that AI can create in the future.

Artificial Intelligence is ‘the theory and development of computer systems to be able to perform tasks normally requiring human intelligence, such as visual perception, speech recognition, decision-making, and translation between languages’ (OxfordDictionaries.com, 2017). The bigger the amount of information and data is, the smarter the artificial intelligence will be (Elgan, 2016).

As big data initiatives mature, organizations are now combining the agility of big data processes with the scale of AI capabilities to accelerate the delivery of business value. Although many AI technologies have been in existence for several decades, only now are they able to take advantage of datasets of sufficient size to provide meaningful learning and results. The ability to access large volumes of data with agility and ready access is leading to a rapid evolution in the application of AI and machine-learning applications. (MIT Sloan Management Review, 2017) “Scaled up” algorithms such as recurrent neural networks and deep learning are powering the breakthrough of AI (MIT Sloan Management Review, 2017) (See Appendix 4).

Chapter 2

Conclusion: Artificial Intelligence AI is the broadest term, ­applying to any technique that enables computers to mimic human intelligence, using logic, if-then rules, decision trees, and machine learning (including deep learning).

(Fortune, 2017) Machine Learning The subset of AI that includes abstruse statistical techniques that enable machines to improve at tasks with experience. The category includes deep learning. This could also be seen as a first step coming from big data towards fully self learning (AI) software.(Fortune, 2017) Deep Learning The subset of machine learning composed of algorithms that permit software to train itself to perform tasks, like speech and image recognition, by exposing multilayered neural networks to vast amounts of data. (Fortune, 2017). Deep learning is in the roadmap seen as the second step that makes the artificial intelligence software as smart as needed for predictions.

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Fig. 2 - Overview direction

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3. CREATIVE TREND RESEARCH To envision a design roadmap for Tommy Hilfiger the first step is to perform Creative Trend research. The objective of the trend research is to enable the team to spot signs of change/early trends and understand how these impact the future of fashion and align with Tommy Hilfiger’s future vision.

The process DEPEST Analysis This phase begins with a strategic trend scanning of the environment. Starting out broad with a DEPEST analysis, enables to look at trends globally from every angle (see figure 3 and appendix 5).

Trend Topics After having a broad vision of trends in the world, it was decided to dive deeper into the creative trend research process. In Trend topics, a visual scouting of new/emerging trends was done – documenting this desk research via images. Eventually trend cards were created from these topics and clustered based on perceived similarities (see figure 4 and appendix 6 for the results).

Trend Views After having these clusters, some trends became more apparent than others. In order to understand the importance of the trends for the users and the strategic fit for the business, they were plotted on a graph (see figure 5). This activity became the basis of envisioning a possible future experience of possible future users.

Chapter 3

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Fig. 3 - DEPEST

12 Chapter 3

Fig. 4 - Trend topics

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Fig. 5 - Trend views

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4. CHOSEN DIRECTION

Chapter 4

Sustainability was identified as an important focus point for Tommy Hilfiger after having done the analysis (chapter 1) – a trend that is growing and will only become stronger as time passes. Out of the trend views lab came three trends of sustainability that are both relevant for Tommy Hilfiger, as for the customer. Those aspects were recycling/upcycling, extended lifecycle and local economy/ production. Looking at the general fashion industry, sustainability is a big topic. Focussing especially on extended lifecycle.

because they are still qualitatively good (Horne, 1998). The latter especially occurs for more expensive, qualitative better clothing (Birtwistle & Moore, 2007). However, while people do tend to care more about the sustainability behind the clothing they buy, there are still so many environmental threats caused by the fashion industry that people just don’t know about. If people would re-use or recycle products or fabrics more often than they do now, the environmental impact would be gigantic (Claudio, 2017).

There is a well-known distinction between the so-called ‘fast fashion’ and ‘slow fashion’ that is becoming more and more the centre of attention within the fashion industry. Fast fashion encourages people to have a “throwaway attitude” towards their clothing, since it forces people to replace their clothes with new ones, even before the life cycle of the old ones actually ended (Birtwistle & Moore, 2007). Fast Fashion products (e.g. H&M, ZARA) are expected to be used less than ten times (Birtwistle & Moore, 2007). According to the EPA Office of Solid Waste, Americans even throw away more than 30kg of clothing and textiles per person per year (Claudio, 2017). Even though the current fashion industry still tries to stimulate their customers’ ‘throwaway attitude’ (D’Amico et al., 2013), those particular customers, on the other hand, do appear to care more and more about sustainability nowadays.

This deficiency in awareness is thought to be due to lack of media coverage. Most of the studies state that participants would modify their clothing consumption and disposal behavior if they were more aware of the specific social and environmental consequences (Birtwistle & Moore, 2007). However, even if people are aware of the environmental consequences of recycling, fast fashion has forced the consumer into having the need to ‘always be in style’. Even though the product life cycle can already be extended by improving the quality of the textiles (Gwilt, 2011) and by making people aware of the environmental consequences, people still want to feel like they are ‘up to date’ in terms of fashion. As figure 6 shows, both fashion and style appear to decline over time. This could be a great opportunity for Tommy Hilfiger to anticipate on. Creating items with a long life cycle, while creating the feeling of ‘always being in style’. This would fit their vision perfectly, since

They act on this in multiple ways. Where some specifically look for clothing made of organic cotton, others act on it by giving their old clothes to charity shops, and thus recycling their items

15 Tommy Hilfiger is already trying to be as sustainable as possible in their usage of fabrics (Hilfiger, 2017). The customer awareness about the sustainability could be improved significantly, and the way of presenting or even creating these products in a way that the customer would always be in style could be a next step for them.

fig. 6: Style, fashion, special product life cycle stages (Claessens, 2017)

16 Chapter 1

5. FUTURE VISIONING In the previous chapter, extended lifecycle was chosen as the main focus to be used in future visioning. To create ideas, a brainstorming session is conducted and discussions about the future direction within sustainability, extended lifecycle and fashion are held. After brainstorming, the ideas were discussed critically, relationships and connections between the different ideas occurred. Finally, the ideas were clustered into different categories (see figure 7). By combining these categories, a future vision statement has been made: “In the future of fashion, the lifetime of fabrics is infinite.

Though always being in style because fashion can be instantly personalized. It eases your daily life, while having minimal impact on the earth.�

Future scenario With this vision statement, a future scenario has been made that relates to the topic and to get a clear overview of how the future world will look like. The scenario shows a future shop were fitting rooms no longer exist. Clothing will be made tailored and on demand, the sustainable level of clothing and the extended lifecycle of these clothes will be important, the shop is energy neutral, it shows the production of the clothing and AI will be used wherever you are within the physical shop (see figure 8).

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18 Chapter 5 Music generating clothes No more beds Practical fashion No temperature All you need is fashion differences Functional Clothing

Duracell Fashion

Gender neutral Always in fashion

Gamification clothes Transport fashion

Stain free Wearing it for 10 years

Always in style

Tailor fit - instantly Rainbow colors

Attached to clothes emotionally

Print it yourself

Best of everything Sustainability fabrics

Only mine

Personality altering

Spray painted clothes Made from growing materials

Fashion neutral Timeless fashion No activity fashion

Old clothes instantly changing into the ones you like

Personal stylist

No more wear & tear

Biodegredable clothing

Culture free clothing

No more fashion trends

No more broken things Life time fabrics

Predicting styles

No more clothes

Race no bar

Functional clothes for different weather

Selfhealing fabric

No seasons

Everybody wears VR goggles to virtually colour all white clothes

No more laundry

Protective fashion Nutritional clothes

Getting what you need before knowing you need it

Including fitting makeup Fabrics made from everything neutral

Instant personalisation

Change style during the day Smell fashion Shape changing clothing Fits on your figure

Clothes that expand/shrink based on how much you’ve eaten

Change color instantly

Fig. 7 - Clustering categories

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Fig. 8 - Physical shop

20 Chapter 5

Future concept After discussing the vision statement and scenario, a discussion and brainstorm was conducted to shape the final concept (see figure 9). These sessions concluded with the following statements, which will be included in the concept:

materials, thus money.

• Fabrics/clothes getting damaged can be repaired • It empowers the customer, feeling engaged in the sustainability and identify with the brand (see appendix 9 for user values)

• The clothing should consist out of modules, that are visible to Tommy Hilfiger, but not directly visible to the customer.

The goal of adding these modules is making clothes more sustainable and easier to repair for Tommy Hilfiger.

• The clothes should still be able to change and fit the latest fashion trends or preferences of the customer. Mainly because our believe is that fashion trends will still exist in 2035.

• Smart materials are added to the clothing. This could help making the clothes easy to change to the latest style or personal preferences or repaired, without losing materials.

• Artificial Intelligence will be implemented as a tool to collect data, predict materials needed in stores and factories, predict styles and manage inventory. It will be used as a background tool to make the processes of Tommy Hilfiger more efficient and the clothes more sustainable.

Conclusion The advice would be to design clothing that consist out of different modules and made out of smart materials. These modules make it possible to personalize, repair or just change the look or the shape of the clothes you bought, just by adding or removing modules. With this solution, people are always able to change their clothes instead of throwing them away.

The direct added value for the customer with this concept is: • Clothing that is getting out of style can be changed to the latest styles or personal preferences, without losing

Although the concept (see figure 9) elaborates on the store, the focus will be on the sustainable part of the clothing and how AI can help predict and manage everything that goes on within a brand that is focusing on sustainable clothing in the future.

This concept will be used to determine the technical roadmap & the future strategy for Tommy Hilfiger.

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Fig. 9 - Concept

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6. TECHNOLOGY SCOUTING In order to launch new products and services of the future, it is important to scout for relevant technologies that can enable this. From the previous chapter it becomes clear that the technologies need to be found that enable the following functionalities: • Personalization • Data collection • Enabling extended lifecycle of clothes, mainly implementing smart materials To scout these technologies, the sessions ‘out of the box scouting’ as well as ‘mapping the evolution of strategic technologies’ have been conducted.

Out of the box scouting Based on web research and literature study, emerging technologies are plotted on a matrix with user value on the y-axis and the strategic relevance for Tommy on the x-axis.

See figure 10. The 3 technologies that are expected to be the most relevant for tommy and the user are selected and will be analyzed.

Chapter 6

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Fig. 10 - Matrix

Humanized big data

Big data for Tommy Hilfiger

Big data brands can improve predictions and discover upcoming trends at an early stage. This can help brand target the “early adopter� user group.

Cloud based software development can be used to support big improve data insights.

Start as soon as possible to collect data of the consumers in the stores and on the website to ensure a credible result. With the support of the cloud, big data can be collected and used in the future for AI. Real time analysis increases the value of data, because it is collected during customer interaction. The quality of the data later affects the usage of the AI (Babcock, 2017).

The fast growing amount of unstructured data means that ways to harness the benefits of cloud computing and big data are more important than ever (IBM, 2014).

Smart materials Materials with specific characteristics, enabling them to react to external stimuli. (RVO, n.d.)

Multiple large companies working on the development of smart materials and textiles. (Moruzzi, 2017)

Smart textiles are being studied at the Tu Delft, researching textile sensors and for example cooling textiles. (TU Delft, 2017) Although these developments might be at an early development stage, it is expected that these developments will evolve quickly with the growing amount of interests and large investments. (RVO, n.d.)

Smart materials for Tommy Hilfiger With smart materials it is possible to create clothes that can be repaired easily or even fix themselves (Messer, 2016). This technology development is mostly interesting for extending the lifecycle of the products of Tommy Hilfiger and fits the chosen focus.

Not losing materials, while changing the style of a product, could reduce the waste resources in the fast fashion industry.

With smart materials, the products of Tommy Hilfiger can be used to make a product into a different shape, without losing material. This could make it possible to be in style, without having to throw away products.

Self healing textiles are still a new invention, why it takes some time to introduce them to the market (Messer, 2016).

Tommy as a responsible brand should wait until the third horizon to use the new materials for clothing to ensure a seamless selling-process.

Fig. 11 - Technologies

24 Chapter 6

25 The technologies found in figure 11 have been mapped in the form of one pagers to assess their readiness (see appendix 7B).

Conclusions Technology scouting gives logical direction and steps to achieve the future vision. In chapter 7 it is described how these technologies are used to pace the roadmaps.

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7. TIME PACING In order to create understanding behind the time pacing of the roadmap, it is important to both look at the possibilities within the future vision itself and the pacing at which Tommy launches certain new developments and collections. While looking at Tommy’s specific timeline, we also identified and studies the timeline for two of their competitors: Levi Strauss & Co. & Ralph Lauren in order to make the outcome more reliable by comparing all three timelines. We will try to make a distinction between incremental launches (small changes e.g. new collections or collection expansions) and disruptive launches (big changes e.g. new target groups, new approaches, new styles). The pacing behind disruptive launches could then represent our time set for the future vision, and the pacing behind the incremental launches could represent the horizons in between the present and the future vision.

Findings from Tommy Hilfiger’s timeline There’s exactly 20 years in between the moment when Tommy first introduced its women’s line and the moment when they introduced a total new women’s line with Gigi Hadid as representor. They started their first line in 1985 as ‘American cool”, a colorful, preppy style, and about 7 years later the style developed into a “hiphop” kind of style. You can see that there are 3 years in between every major product expansion or line launch, except for the time Tommy was suffering financially.

Incremental launches: ±3 years Disruptive launches: ±20 years (chan, 2017) (Outletshoppers.com, 2017)

Chapter 7

Findings from Levi’s timeline Levi’s timeline is in a way quite comparable with Tommy’s timeline. Big changes appear every 15-20 years. They started the women’s jeans line in 1934, and about 20 years later (1953) they started adding denim jackets to their line, coming with new items every 1-2 years. Then, in 1967, they changed their logo and appearance majorly and in 1986 they changed their style to a more story-telling, rock music kind of style. Another 20 years later, in 2000, they started to focus more on sustainable items, adding again new items and collections every 1-2 years.

Incremental launches: ±1-2 years Disruptive launches: ±15-20 years (Image.slidesharecdn.com, 2017) (Google.nl, 2017) Findings from Ralph Lauren’s timeline Finally, Ralph Lauren’s timeline can be compared to both Levi’s and Tommy’s as well. You can see that they keep on adding new collections and new styles every 2-5 years. Only in between introducing the Polo men’s originals line and introducing the Polo sports line there is a gap of about 20 years. These are two completely different collections and styles, while all others collections (added every 2-5 years) are expansions of the current product lines with either a different color, different sports or different label (green, pink etc.).

Incremental launches: ±2-5 years Disruptive launches: ±20 years (Slideshare.net, 2017) (eBay, 2017) See figure 12 for a details visualisation of the three timelines.

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Fig. 12 - Timelines

Our conclusion: Based on the previous findings we conclude the following: • Most brands come up with incremental line launches every 2 - 5 years • Most brands come up with disruptive launches every 1520 years However, these launches do need to be aligned with the development of the future vision. In the following sub-chapter the future vision is divided into several aspects, and the time pacing behind each aspect is determined.

Pace of Innovations: • Our future vision for Tommy hilfiger consists of: • Extended life cycle • Moving from machine learning to Deep learning for AI • Empowering the users • Smart Materials

To achieve this vision we drafted three horizons to help us understand how each cycle of our roadmap can bring us closer to the future vision.

Each cycle = New business development (see figure 13) Design value enhancement (Horizon I) (see figure 14) • Existing Market + Existing Technology = Current trends + Launch of Tommy Hilfiger sustainable brand • User centred design (Horizon II): technology push (see figure 15) • Existing Market + New Technology = Transparency + recyclability + adoption to smart technology + technology development (learning of AI system starts (Machine learning)) • Value proposition creation (Horizon III) (see figure 16) • New Market + New Technology = User empowerment + Smart materials + launch of new refurbishing line + optimisation of AI system (deep learning)

28 Chapter 7

Fig. 13 - Three horizon cycles

Fig. 14 - Horizon cycle 1

29 Fig. 15 - Horizon cycle 2

Conclusions: Hence, while considering availability of technology, market growth, user and business values and considering the current time pacing of Tommy and their competitors, we decided to pace our roadmap as: 2020, 2025, 2030 Horizon I: 2017 - 2020 Create awareness about the sustainability of the brand.

Horizon II: 2020 -2025 Add transparency & recyclability to let customers contribute and create acceptance towards smart technology.

Horizon III: 2025 - 2030 Launch a small, smart materials- and refurbishing line to empower the customer

Fig. 16 - Horizon cycle 3

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8. ROADMAP Future vision In chapter 5 the future vision is described based on a future vision statement. The statement being: “In the future of fashion, the lifetime of fabrics is infinite. Though always being in style because fashion can be instantly personalized. It eases your daily life, while having minimal impact on the earth.” Through creating an ‘infinite clothing line’, adjustable through smart material modules, Tommy Hilfiger can anticipate on this particular statement. However, this future vision concept is rather futuristic, thus unrealistic to achieve within 20 years (see time pacing).

For this reason a third horizon is determined to create a more tangible, realistic concept for Tommy Hilfiger to focus on. Based on this third horizon the first and second horizon are determined as well, in order to create a logical, step-wise process for Tommy Hilfiger to achieve this future concept.

Third horizon In the third horizon Tommy Hilfiger will launch a small, smart materials- and refurbishing line to empower the customer. The focus here really is on innovating the fashion industry and its approach towards recycling and personalization (chapter 3). The premium predicted smart materials line will empower the customer by offering innovative, yet sustainable clothing in an efficient way. These smart materials include self-healing materials, that make it possible to achieve a 100 percent recycling rate (chapter 6). This results in a significant effective way of using fabrics for Tommy Hilfiger, since this means that they can recycle their

Chapter 8

own fabrics, resulting in a closed loop (appendix 9). This infinite approach and the possibility for direct refurbishing empowers the customers and allows them to always be in style (appendix 9).

The smart materials line will result in a direct refurbishing and premium model business strategy (appendix 10). The line will be more expensive than the recycled line, but it offers the customers the chance to recycle these specific items and get a new item from the same material back.

First horizon The first horizon is aimed at creating awareness about the sustainability of Tommy Hilfiger as a brand. In order for Tommy Hilfiger to become this sustainable brand, they need to steer the brand image that potential customers have to fit their desired identity (chapter 4). So how is Tommy Hilfiger going to achieve this? With the launch of the new Tommy Hilfiger Sustainable Campaign. This campaign is focussed on creating awareness through this network effect model (appendix 10).

The business goal of this campaign is to create trust through transparency in sustainable production, so that the customer’s responsibility feeling starts growing (appendix 9). The message will be communicated throughout marketing channels, such as advertising on- and offline. Besides this, clothing tags will get to convey more specific information about the sustainable production methods and data on the ecological footprint will be shared with customers. During the rollout of the campaign, customer data is gathered, both in stores as well as online on

31 the website and in the smartphone application. This is done to gather enough data for the Artificial Intelligence system that will be introduced in horizon two to work (see chapter 2 & 6).

Second horizon: Technology push First part of second horizon In the second horizon, the focus is on adding transparency and recyclability to let customers contribute and to create acceptance towards smart technology (appendix 9). In the first phase of this horizon, the Tommy Hilfiger In-store take-back system will be introduced. This system allows for collecting old garments in the in-store recycling bins. Easy for the customer, yet an effective way to let customers become familiar with the recycling concept. The experience is an important part in gaining the trust of customers towards this concept and creating a sense of responsibility (appendix 9). In this part of the second horizon, Tommy Hilfiger will not make any revenue, but will profit from the attitude change of the customers later on (appendix 10). The customer will receive a twenty percent discount on his or her next purchase. The old garments will be recycled in collaboration with a partner recycling company (appendix 11). Just as in the first horizon data will be gathered on- and offline, yet this time focussed on the recycling behavior and attitude of the customers (appendix 2 & 6) Second part of second horizon In the second part of horizon two, all the acquired knowledge and collected data will be used to implement the first new

product line (appendix 6). With the launch of the recycled line, customers have the chance to buy fully recycled items, standing out from the crowd (appendix 9). As in the first part of the second horizon, the collaboration with a partner recycling company is vital here, because this partnership will be expanded with the implementation of a new logistics approach to make this system work (appendix 11). This is where artificial intelligence comes in. This phase is the testing phase of the AI system. Using the data that has been gathered in the previous horizon and the first phase of this horizon, the system will be improved constantly through system learning. Here, the AI system will be used to manage the recycled line. This is the point where AI becomes beneficial for Tommy Hilfiger, because it can be used to create a storage inventory, but even to predict and advise styles (chapter 2). This adds to the efficiency (appendix 9).

Roadmaps The strategic roadmap is mainly focused on the actual story behind the roadmap with its user- and business values that come along with it. The tactical roadmap contains more details concerning aspects as technology, trends and resources as well. In the visualizations on pages 36 - 38 it will become clear which parts come from which chapters in the report to show the reasoning behind each and every decision. For further roadmap explanations, see appendix 8.

32 Chapter 1

STRATEGIC ROADMAP

CURRENT

Create awareness about the sustainability of the brand.

2020

INFINITE

Add transparency & recyclability to let customers contribute and create acceptance towards smart technology.

RESPONSIBLE CONTRIBUTE

EXPERIENCE

2025

STAND OUT

Launch a small, smart materials- and refurbishing line to empower the customer

EMPOWER

USER VALUES

IDENTITY

CIRCULAR

BUSINESS BUSINESS MODELS VALUES

TRUST RESPONSIBLE

LOYALTY

EFFICIENCY

INNOVATION

RECYCLE MODEL

SUSTAINABLE BRAND IMAGE network effect model

FUTURE VISION

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Sustainable personalization with smart modules and infinite materials, yet always in style.

DIRECT REFURBISH premium model

recurring revenue model Creating customer loyalty and identification through offering recycling services and products.

Create trust through transparency in sustainable production

2030

Empower the customer by offering innovative, yet sustainable clothing in an efficient way.

COLLABORATE WITH RECYCLER

ADD TAGS

INSTORE RECYCLING FACILITY MARKETING

SHOW DATA

COLLECTING RECYLING DATA

IMPLEMENT LOGISTICS

CUSTOMER HANDS IN SHIRT

MARKET LINE TOMMY X GIGI SUSTAINABLE

TOMMY SUSTAINABLE CAMPAIGN

LAUNCH RECYCLED LINE

20% discount

100% recycled

SMART MATERIAL WITH SELF HEALING CHARACTERISTICS

COLLABORATION WITH RECYCLER

PLACE INSTORE RECYCLING BINS

COLLECTING CUSTOMER DATA

CUSTOMER RECEIVES NEW SHIRT

INSTORE TAKE-BACK SYSTEM

PREDICTED SMART MATERIALS LINE AI: USE TO MANAGE RECYCLED LINE

Desire for new item because item is outworn or worn out

New combination of modules makes for instant new item with old material

INFINITE LIFECYCLE, WHILE ALWAYS IN STYLE.

34 Chapter 1

TACTICAL ROADMAP

2020

CURRENT

Create awareness about the sustainability of the brand.

CIRCULAR

Add transparency & recyclability to let customers contribute and create acceptance towards smart technology.

2025

INFINITE

Launch a small, smart materials- and refurbishing line to empower the customer

2030

35

FUTURE VISION

USER VALUES

Sustainable personalization with smart modules and infinite materials

LAUNCHES

SUSTAINABLE CAMPAIGN

PRODUCT SERVICE TRENDS TECHNOL. MARKET

RECYCLED LINE

SMART MATERIALS LINE

Desire for new item because item is outworn or worn out

COLLABORATE WITH RECYCLER ADD TAGS

MARKETING

SHOW DATA

CUSTOMER HANDS IN SHIRT

COLLECTING RECYLING DATA MARKET LINE TOMMY X GIGI SUSTAINABLE

TOMMY SUSTAINABLE CAMPAIGN

LAUNCH RECYCLED LINE

20% discount

CUSTOMER RECEIVES NEW SHIRT

100% recycled

SMART MATERIAL WITH SELF HEALING CHARACTERISTICS

COLLABORATION WITH RECYCLER

PLACE INSTORE RECYCLING BINS

INSTORE TAKE-BACK SYSTEM

PREDICTED SMART MATERIALS LINE

AI: USE TO MANAGE RECYCLED LINE

Instant refurbishing of clothing

INSTORE RECYCLING FACILITY IMPLEMENT LOGISTICS

COLLECTING CUSTOMER DATA

TECHNOLOGY

TAKE BACK SYSTEM

New combination of modules makes for instant new item with old material

Recycling Extended lifecycle Local economy Circular economy Big data Machine learning Deep learning instore&website data software

DEVELOP CLOUD SOFTWARE

Artificial intelligence

COLLECT BIG DATA AND PREPARE FOR LATER USE

UPDATE: RECYCLING PREDICT MODULAR INVENTORY

PREDICT INVENTORY DEVELOPMENT SOFTWARE

MODULAR BUILT FASHION

DEVELOPMENT OF RECYCLED MATERIALS CLOUD SOFTWARE (outsourced)

AI PROGRAMMING TEAM (outsourced)

LOCAL RECYCLING LOGISTICS TEAM (outsourced)

PRODUCTION OF RECYCLED FABRICS

PREDICT STYLES THROUGH MODULES PREDICT RECYCLING BEHAVIOR OF MODULES

PREDICT RECYCLING BEHAVIOR

Material development

RESOURCES

UPDATE: RECYCLING

UPDATE: RECYCLING

DEVELOPMENT OF SMART MATERIALS SMART INNOVATION MATERIAL TEAM

INFINITE LIFECYCLE, WHILE ALWAYS IN STYLE.

36 Chapter 1

TACTICAL ROADMAP

See chapter 7 ‘Time Pacing’ for explanation about horizon devision and reasoning for years.

See previous pages for explanation on each horizon.

See chapter 5 ‘Future Vision’ See appendix 9 ‘User Values’ See appendix 9 ‘Business Values’

See appendix 10 ‘Business model’

See previous pages

See chapter 4 ‘Chosen Direction’

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38 Chapter 1

TACTICAL ROADMAP

39

See chapter 3 ‘Creative trend research’

See chapter 6 ‘Technology scouting’ See appendix 8 ‘Roadmap’ See chapter 3 ‘Creative trend research’ See chapter 6 ‘Technology scouting’ See appendix 11 ‘Resources’

40

9. REFERENCES Accenture, Digital consumer trends. Available at: https://www.accenture.com/ us-en/insight-trends-communications-digital-consumer-trends-services. Last visit: 04.11.2017 Accenture.com. (2017). Technology Vision 2017 – Top 5 technology trends. [online] Available at: https://www.accenture.com/us-en/insight-disruptivetechnology-trends-2017 Last visit: 06.11.2017 AIBrain (2017). AIBrain Website. Avaivable at: http://aibrain.com Last visit: 03.11.2017 Babcock, C. (2017). Big Data moves towards real-time analysis. Available at: https://www.informationweek.com/big-data/software-platforms/big-datamoves-toward-real-time-analysis/a/d-id/1320952? Last visit: 04.11.2017 Banjo (2017). Banjo Websit. Available at: https://ban.jo Last visit: 03.11.2017 Basile, G., Broman, G., Robert, K.-H., 2011. A systems-based approach to sustainable enterprise: requirements, utility and limits. In: McNall, S.G., Hershauer, J.C., Basile, G. (Eds.), The Business of Sustainability e Trends, Policies, Practices and Stories of Success, Vol. I: Global Challenges and Opportunities.

Birtwistle, G., & Moore, C. M. (2007). Fashion clothing–where does it all end up?. International Journal of Retail & Distribution Management, 35(3), 210216. Available at: http://www.emeraldinsight.com/doi/pdfplus/10.1108/09590550710735068 Last visit: 06.11.2017 Chan (2017). Tommy Hilfiger Brand Revival. [online] Slideshare.net. Available at: https://www.slideshare.net/sandychan23/tommy-hilfiger-brand-revival Last visit: 07.11.2017 Claessens, M. (2017). Product Life Cycle Stages - Managing the Product Life

Cycle. [online] Marketing-Insider. Available at: https://marketing-insider.eu/ product-life-cycle-stages/ Last visit: 06.11.2017 Claudio, L. (2017). Waste Couture: Environmental Impact of the Clothing Industry. [online] PubMed Central (PMC). Available at: https://www.ncbi.nlm. nih.gov/pmc/articles/PMC1964887/ Last visit: 06.11.2017 D’Amico, S., Giustiniano, L., Nenni, M. E., & Pirolo, L. (2013). Product Lifecycle Management as a tool to create value in the fashion system.

International Journal of Engineering Business Management, 5, 33. Available at: http://journals.sagepub.com/doi/pdf/10.5772/56856 Last visit: 28.10.2017 eBay. (2017). Detailed History & Timeline for the World of Ralph Lauren. [online] Available at: http://www.ebay.com/gds/Detailed-History-Timelinefor-the-World-of-Ralph-Lauren-/10000000178578451/g.html Last visit: 28.10.2017 Elgan (2016). Artificial Intelligence needs your data - all of it. Available at: https://www.computerworld.com/article/3035595/emerging-technology/ artificial-intelligence-needs-your-data-all-of-it.html Last visit: 04.11.2017 Fortune (2017), Why Deep Learning Is Suddenly Changing Your Life.

Available at: http://fortune.com/ai-artificial-intelligence-deep-machine-learning/ Last visit: 06.11.2017 Google.nl. (2017). Redirect Notice. Available at: www.google.nl/oijawerh Last visit: 22.10.2017 Gwilt, A. (2011). Shaping sustainable fashion: Changing the way we make and use clothes. Routledge. https://books.google.de/ Horne, S. (1998). Charity shops in the UK. International Journal of Retail & Distribution Management, 26(4), 155-161. Available at: http://www. emeraldinsight.com/doi/full/10.1108/09590559810214921 Last visit: 05.11.2017

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Hutter, F., Xu, L., Hoos, H. H., & Leyton-Brown, K. (2014).

Algorithm runtime prediction: Methods & evaluation. Artificial Intelligence, 206, 79-111.

IBM (2014). Cloud computing and big data: An ideal combination. Available at: https://www.ibm.com/blogs/cloudcomputing/2014/02/cloud-computing-and-big-data-an-idealcombination/ Last visit: 03.11.2017 IBM (2017). IBM Website Cloud functions. Available at: https:// www.ibm.com/cloud/functions Last visit: 03.11.2017 Image.slidesharecdn.com. (2017). Cite a Website - Cite This For Me. [online] Available at: https://image.slidesharecdn. com/935c73ca-aea1-4bd4-a762-560bc87cd37c150516140042-lva1-app6892/95/crimson-levis-3520-mfaphase-b-3-638.jpg?cb=1431786763 Last visit: 07.11.2017 Issuu, Trend Report: Future of sustainable fashion, Mar 27, 2017. Available at: https://issuu.com/globalchangeaward/docs/ global_change_award_-_trend_report Last visit: 04.11.2017 Marketing-Insider, The Macro Environment - Six Forces.

Available at: https://marketing-insider.eu/marketing-explained/ part-ii-understanding-the-marketplace-and-consumers/macroenvironment/ Last visit: 04.11.2017 Messer, A. (2016). Self-healing textiles not only repair themselves, but can neutralize chemicals. Available at: http://news.psu.edu/

story/418507/2016/07/25/research/self-healing-textiles-not-onlyrepair-themselves-can-neutralize Last visit: 04.11.2017 MIT Sloan Management Review, How Big Data Is Empowering AI and Machine Learning at Scale. Available at: http://sloanreview. mit.edu/article/how-big-data-is-empowering-ai-and-machinelearning-at-scale Last visit: 06.11.2017 Moruzzi, M. (2017). How smart materials will literally reshape the world around us. [online] TechCrunch. Available at: https:// techcrunch.com/2016/09/17/how-smart-materials-will-literallyreshape-the-world-around-us/ Last visit: 01.11.2017 Outletshoppers.com. (2017). Tommy Hilfigers Story - History of a Fashion Icon | Outlet Shoppers. [online] Available at: http://www. outletshoppers.com/tommy-hilfigers-story/ Last visit: 07.11.2017 Oxford Dictionaries.com (2017) (n.d.). Available at: https:// en.oxforddictionaries.com/definition/artificial_intelligence Last visit: 01.11.2017 Patel, D. (2017, September 22). 8 Ways Generation Z Will Differ From Millennials In The Workplace. Available at: https://www. forbes.com/sites/deeppatel/2017/09/21/8-ways-generation-zwill-differ-from-millennials-in-the-workplace/#4b50a29e76e5 Last visit: 20.10.2017

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Radar.sustainability.com (n.d.). SustainAbility  What’s Next for Business?. Available at: http://radar.sustainability.com/annualtrends-report/ Last visit: 06.11.2017 RVO (n.d.). SMART MATERIALS in Nederland : Van Fundamenteel Onderzoek naar Innovatieve Maatschappelijke Toepassingen. [online] Available at: https://www.rvo.nl/sites/ default/files/SMART%20MATERIALS%20in%20Nederland%20 NL.pdf Last visit: 06.11.2017 Scribd (n.d.). DESTEP analysis | Customer Relationship Management | Strategic Management. Available at: https://www. scribd.com/document/257124370/DESTEP-analysis Last visit: 06.11.2017 Sennaar, K. (2017, September 15). AI in Fashion - Present and Future Applications -. Available at: https://www.techemergence. com/ai-in-fashion-applications/ Last visit: 05.11.2017 Slideshare.net. (2017). Ralph Lauren Competitive Review. [online] Available at: https://www.slideshare.net/Bassem_ Al_Masri_1976/ralph-lauren-competitive-review Last visit: 07.11.2017.

Struhl, S. (2017). Artificial Intelligence: what part does AI play in predicting consumer choice?. Available at: https://www.the-gma. com/ai-predicting-consumer-choice Last visit: 05.11.2017

Suthaharan, S. (2014). Big data classification: Problems and challenges in network intrusion prediction with machine learning.

ACM SIGMETRICS Performance Evaluation Review, 41(4), 7073. Last visit: 05.11.2017 The Center for Generational Kinetics (n.d.). Learn About Gen Z (aka Generation Z). Available at: http://genhq.com/igen-gen-zgeneration-z-centennials-info/ Last visit: 20.10.2017 The Center for Generational Kinetics, & Dorsey, J. (2016).

Gen Z Tech Disruption: 2016 National Study on Technology and the Generation After Millennials. Available at: http://3pur2814p18t46fuop22hvvu.wpengine.netdna-cdn.com/ wp-content/uploads/2017/01/Research-White-Paper-Gen-ZTech-Disruption-c-2016-Center-for-Generational-Kinetics.pdf Last visit: 20.10.2017 Tommy Hilfiger (2017). Tommy Hilfiger Website - Corporate Responsibility. Available: http://global.tommy.com/int/en/about/ corporate-responsibility/our-3-principles/13 Last visit: 03.11.2017 ToolsHero (n.d.). DESTEP Analysis, a strategy and marketing tool, April 24, 2017. Availabl at: https://www.toolshero.com/marketing/destep-analysis/ Last visit: 04.11.2017 TrendWatching, 5 Consumer Trends for 2017. Available at:

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http://trendwatching.com/trends/5-trends-for-2017/ 04.11.2017

Last

visit:

TU Delft (2017). Smart Textiles. [online] Available at: https:// www.tudelft.nl/io/onderzoek/research-labs/emerging-materialslab/smart-textiles/ Last visit: 06.11.2017 Waller, M. A., & Fawcett, S. E. (2013). Data science, predictive analytics, and big data: a revolution that will transform supply chain design and management. Journal of Business Logistics, 34(2), 77-84.

Williams, A. (2015, September 18). Move Over, Millennials, Here Comes Generation Z. Available at: https://www.nytimes. com/2015/09/20/fashion/move-over-millennials-here-comesgeneration-z.html?utm_source=yourcareerintel.com&utm_ medium=referral Last visit: 20.10.2017

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44 Appendix

APPENDIX Appendix 1 - Specifications Achievement Goals

in Amsterdam.

1. Procure 100% of our cotton from more sustainable resources Since 2012, we have produced over 4 million pieces using organic cotton. In 2016, the BCI ranked Tommy Hilfiger #10 Better Cotton sourcing business (volume).

5. Reduce carton based packaging Goal: By 2020, we aim to reduce total carton consumption (by weight) by 25% and ensure that the materials used are sourced more sustainably.

In North America, we have eliminated more than 50 tons of water by reducing the size of our hangtags.

2. Take an active water stewardship role In 2014, we established a multi-year partnership with WWF to collaborate on preserving water resources through stakeholder engagement and implementing more sustainable water practices across our own operations and those of our manufacturing partners.

3. Produce in facilities where water, energy and chemicals are sustainably managed For our 2017 collections, 25% of our denim products were developed within the EIM Low Impact Process category, which focuses on significantly reducing the use of chemical products per garment as well as water and energy consumption.

4. Reduce greenhouse gas emissions Goal: By 2020, we aim to reduce greenhouse gas emissions across our operations by 20% compared to 2014 levels.

In 2015, we launched our Digital Showroom. This has already led to an 80% reduction in samples at our flagship Digital Showroom

6. Reduce plastic based packaging Goal: By 2020, we aim to achieve a 25% reduction in plasticbased packaging use and source the remainder from more sustainable materials.

7. Recycle store, warehouse and office waste Goal: By 2020, we aim to repurpose and recycle all waste generated at our stores, office and warehouses.* At our European headquarters, approximately 75% of our waste is recycled and 25% is incinerated.

In 2016, a recycling program was piloted in our warehouse in Venlo, the Netherlands resulting in the repurposing or recycling of 86% of non-wearable merchandise in Europe. This program has now been implemented as a regular practice. *as far as local waste infrastructure allows

Appendix 2 - Questionnaire Results

45

46 Appendix

Appendix 3: personas

the ability to integrate everyday life with a digital life.

When developing a future vision, their future target group needs to be analyzed. It is expected that their current target group will shift from millennials to Gen-Z. In order to understand their values and needs, a persona is created. This persona is based this on literature research about Generation-Z, those born between 1995 and 2010, whose members will be around 25 years old in 2030.

The change in mindset that has shaped Gen-Z compared to previous generations makes it more important than ever to consider the needs and desires of this customer audience.

Especially the change in mindset regarding economy,the environment and the drive to pursue sustainable solutions were of great influence.

There are a few typical traits to characterize those called Gen-Z. The focus lies on Gen-Z from western countries, since this is the main sales market for Tommy Hilfiger. This generation can be described as “conscientious, hard-working and mindful of the future’ (Williams, 2015). This is in contrast with for example millennials, who are much more concerned about the here and now. Gen-Z cares greatly about the environment, economy, war and terrorism and the division of leadership (Williams, 2015). Gen-Z is concerned about the impact humanity has on environmental changes and global warming and are actively working on preventing more harm to our planet (The Center for Generational Kinetics, n.d.). They have an entrepreneurial mindset to make a difference, aimed at creating a better future, and they are willing to pursue their dreams in order to make them happen (Patel, 2017). Furthermore, Generation-Z is the first true generation of digital natives (Patel, 2017). They are shaped by constant connectivity and readily available technology and have

Tommy Hilfiger & Gen-Z The analysis of the target group shows that Gen-Z values sustainability more than previous generations. This could be an opportunity for Tommy Hilfiger, especially when looking at their sustainable achievements so far. However, when visiting their digital shop or physical stores, none of their sustainability goals, nor the vision or achievements are clearly visible. To investigate whether the current target group is aware of Tommy Hilfiger’s sustainable achievements and goals, even though they currently do not seem to market these goals, a small survey is conducted. 31 participants filled in the questionnaire. As to be seen in appendix 2, only 3,2% of the surveyed target group was aware of the sustainability of Tommy Hilfiger through campaigns of Tommy Hilfiger.

47 Appendix 4 - Artificial Intelligence

(MIT Sloan Management Review, 2017)

48 Appendix

Appendix 5: Creative Trend reviews DEPEST Analysis The DEPEST Analysis is an abbreviation for demographic, economic, social/cultural, technological, ecological and political factors. It is a tool, that helps to visualize the environment where a given organization is active in. To understand the environment of an organization is important, because you need it to effectively discover the opportunities and threats that face the organisation (Scribd, 2017) Demographic By 2050, global migration is expected to double. This has a major impact on both the location and the nature of demand for products and services. The reason is that the place people can be reached has changed, as have their needs because of the new situations.

Other important factors are the ethnic diversity that provides new opportunities, as well as urbanisation (TrendWatching, 2017).

Incognito individuals enables individuals to explore different conceptions of identity (TrendWatching, 2017) Death of demographic segmentation means that people want to be seen as more than their demographic characteristics – and in turn be treated based on these characteristics (TrendWatching, 2017).

Economic Rise of the maker movement is about collapsing the barrier between producer and consumer (TrendWatching, 2017) Virtual experience economy talks about how digital experiences will quickly come to carry a status-weight equal to ‘real’ experiences, if not become more sought after and prized (TrendWatching, 2017) Ecological Local love shows the importance of local context and localization.

People want to know where the things they are buying/using are being produced. Bridging this gap is going to only become of more importance in the future (TrendWatching, 2017) Circular economy is about finding and unlocking exciting new sources of value, or finding creative new ways to eliminate any wasted resource (TrendWatching, 2017) The universal quest for self improvement continues (Inc.com, 2017)

Social and cultural Core instinct to connect with others. Human beings are social animals, and now we see this as a trend – with people more interested in collaborating, co working, sharing and rise of “social network” connectivity platforms (TrendWatching, 2017).

Experiences are more important than products (TrendWatching, 2017) The search for more authentic brands increases (TrendWatching, 2017) The relentless desire for magical levels of personalized service will meet new intelligent technologies.

Desire to be seen and served as unique increases (TrendWatching, 2017).

Technological Ubitech is about pervasiveness of technology everywhere (TrendWatching,2017)

Appendix 6 - trend topics progress SUSTAINABLE MATERIALS

SOCIAL/ENVIRONMENTAL

AWARENESS

Materials/ usage

Organic fabrics

Sustainable Packaging

Sustainable Shoes

Mass production

Production insights

Sustainable art

Sustainable Products

Sustainable designs

EMISSION CONTROL

SHARING

Climate change

Energy saving

The fashion industry is just at the beginning of the journey to unleash the full potential of Digital.

(Accenture.com, 2017) Smart, connected clothing is opening up completely new opportunities for hyper personalization and making clothes an even more integrated part of your lifestyle (Anon, 2017). Furthermore, connected clothing has a fundamental impact when it comes to garment traceability and automated material sorting in the textile recycling process.

This trend is no longer only about wearable gadgets, but about connected garments monitoring and enhancing large parts of your life. It is also a way to achieve transparency in the fashion value chain from sourcing and production to recycling.

(Anon, 2017)

E-COMMERCE/ DIGITALISATION

Recycling

Re-packaging

RECYCLING/ UPCYCLING

Upcycling products

LOCAL ECONOMY

Organic Food

Local Food

Food replacements Mass production

49

50 Appendix

Appendix 7A - Technologies Insert one pagers for AI User Interface, Digital Textile Printing and Humanised Big data Big data Big data became very important in different industries. The fashion industry can improve the predictions and discover new trends early, if they use Big Data; predictive analytics is closely related to machine learning (Sutharan, 2014). Instagram and other social media channels give a lot of data. With these information, it is possible to discover early adopters of the fashion trends and predict what kind of fashion is important in the future. This part shows what technologies can be implemented with big data to support the analysis and bring better results.

Cloud based software development is often used to support big data and improves the data insights. The fast growing amount of unstructured data means that ways to harness the benefits of cloud computing and big data are more important than ever (IBM, 2014). Companies should start early with data collection of the consumers in stores and on the website, if they want to ensure a credible result.

Another important term is real time analysis In the past the companies mainly used data from feedback of the customer. The most valuable data, however, is the data that is collected and analyzed during the customer interaction (Babcock, 2017).

Artificial Intelligence (AI) Big data builds the foundation for reliable use of AI. The bigger the amount of information and data is, the smarter the AI will be (Elgan, 2016). The usage of AI in combination with big data will enable the company to predict various consumer choices and trends (Struhl, 2017).

Our future vision tries to implement a fully functioning recycling environment for Tommy Hilfiger .In this case it is important to be prepared with an understanding of the kind of clothes and fabrics the customers will bring for recycling. AI predictions can support the business by predicting the recycling behavior of consumers.

It is also possible to manage the supply chain and storage using AI (Waller & Fawcett,2013).

Another improvement we want to reach with AI is the prediction of styles. In general, it will be possible to predict future style trends(Hutter et al., 2014). But in the future, we even want to implement an AI that gives personal advice to the customers , tailored to their needs and clothing preferences.

Smart Materials Smart materials are materials that have specific characteristics, enabling them to react to external stimuli. These external factors could change the colour, shape or even composition. (RVO, n.d.). Currently a lot of research is being conducted regarding smart materials.

Looking at current development, there are multiple large

51 companies working on the development of smart materials and textiles. Smart textiles are being studied at the Tu Delft, researching textile sensors and for example cooling textiles.

(TU Delft, 2017). More sustainable options of smart materials could be the self-healing materials developed by Supra Polix BV. They already managed to create polymers that heal after being cut in half (ref). Next to Supra Polix, Airbus as well as the automotive industry is doing research on self healing materials (Moruzzi, 2017). Although these developments might be at an early development stage, it is expected that these developments will evolve quickly with the growing amount of interests and large investments (RVO, n.d.).

With smart materials it is even possible to create clothes that can be repaired easily or even fix themselves (Messer, 2016).

This means that customers can wear new clothes that are made out of the refurbished smart fabrics. This could even stop the massive waste of resources in the fast living fashion industry.

52 Chapter 5

Appendix 7B - One Pagers

SMART MATERIALS Maturity status 50% proven Availability for application in 3 – 5 years - Designed materials that have one or more properties that can be significantly changed in a controlled fashion by external stimuli - Possibility to implement wearable technology directly into fabric, creating interactive or smart fabrics instead of devices.

- New materials allow new types of circuits and batteries, resulting in the development of new technologies.

- Can be used to expand the possibilities that products offer.

- Can be used to extend the lifecycle of products.

- Advantages: Enormous market potential, sustainable, enhancing UX, new product segments.

- Disadvantage: Still experimental, currently still expensive, complex.

Sources https://blog.alliedmarketresearch.com/trends-in-smar t-materials-and-technologies-market-310 http://www.wired.co.uk/article/smart-fabrics-beat-sm art-devices Potential benefit for Tommy Hilfiger Implementation of technology in garments to enhance user experience or using smart materials to prolong the life-cycle of products, enhancing sustainability.

Fig. 11 - One pager: Smart materials

53

AI USER INTERFACE

54 Chapter 1

Maturity status 60% proven Availability for application in 1 – 5 years (depending on difficulty)

- AI as a way to make user interfaces more sophisticated.

- AI interfaces simplify, yet improve experiences.

- Rapidly maturing because of fast development and big data generation.

- AI enables conversational user interfaces.

- AI can provide real-time suggestions, such as clothing advice based on personal preferences.

- AI can make complex user interfaces easy to understand.

- AI user interfaces improve customer engagement and create a more inviting atmosphere.

- AI user interfaces are becoming the primary point of communication between company and customer.

- A poor experience with third party AI systems can hurt a brand, so making sure that the customer experience is good is vital for companies Sources https://www.accenture.com/us-en/insight-artificial-intell igence-ui https://www.salmon.com/nl-nl/wat-wij-denken/blogs/airedefining-traditional-user-interface/ Potential benefit for Tommy Hilfiger AI can be used to drastically enhance the customer experience by creating engaging and inviting experiences. An example can be real-time suggestions to give personalized fashion advice to customers.

Fig. 12 - One pager: AI user interface

DIGITAL TEXTILE PRINTING Maturity status 80% Availability for application 0 – 2 years - Century old approach for creating fabrics industrialized.

- Rapidly growing market and maturing technology.

- Driven by the increasing demand for rapid customization to create unique, personalized clothing garments or household products.

- Enables fast brand adaption to new fashion trends.

- Advantages: short production run and turnaround time possible when producing multiple products, usable for limited editions or even for one-off products, cheaper for small-scale projects.

- Disadvantages: expensive for large-scale projects, technology still in development phase (although maturing rapidly) Sources https://www.inkworldmagazine.com/issues/2016-07-01 /view_features/the-rapid-growth-of-the-digital-textile-m arket https://graphicartsmag.com/articles/2017/02/future-digi tal-textile-printing/ Potential benefit for Tommy Hilfiger This technology enables Tommy Hilfiger to offer customers direct and fast personalization options. Unique garments, based on personal preference, can be created in small scale, local production facilities.

Fig. 13 - One pager: Digital textile printing

55

56 Appendix

Appendix 8 - Tactical Roadmap - A more detailed explanation First, we will explain our strategic roadmap. The first horizon is Tactical roadmap Now, when looking at the tactical roadmap with this knowledge, the top part of the roadmap has been explained. There is however still some information that needs to be explained.

First of all, the market trends that are of influence for the strategy were taken into account. Recycling is a major trend that has grown over the years. This will only get bigger in the near future (see chapter 1: Trend analysis). But besides recycling, other trends that take the idea a step further are identified as well.

Extended lifecycle means that items are longer lasting and that they can be re-used again without being recycled. Taking this even further creates a local economy, where the recycling can be done in the local environment. Finally, a circular economy can be reached, where products can be re-used again and again, creating an infinite product loop.

The development of the needed technology can be divided into three main technologies. Firstly, the gathering of data is very important, since the AI system is going to use this ‘big data’ later on. This is done through machine learning, the process in which a computer system becomes smarter and more elaborate because of the use of algorithms that parse the increasing amount of useful data. At roughly the same time, deep learning starts to

become more important. In the end, deep learning will be used to create a system that is able to, based on previous experience, find solutions by itself because it can create connections that have not been programmed but developed by itself. At this point, the system is able to anticipate on future changes and can predict style trends in order to give the customer advice to always be in style.

When considering these technological innovations in more detail, specific technologies that need to be used to reach the goals in the roadmap, can be identified. To make our products work the way it is intended to, technological advancements have to be made.

For example, for the in-store and website experience, software needs to be developed. This cloud software needs constant updating when new features and clothing lines are launched.

Regarding the development of artificial intelligence, quite some steps have to be made. In the first horizon, as mentioned before, the data for later use needs to be gathered. In the first part of the second horizon, the software for the recycling system needs to be developed. In the second part of this horizon, this system can be used to predict the inventory and the recycling behavior.

This is where the data from previous phases comes in and where the system starts to learn and develop from ‘machine learning’ into AI. In horizon three this evolves into the complete system, where it can be used for predicting the modular inventory, new styles through these modules and the recycling behavior of modules. Besides these digital innovations, some of the most

57 Appendix

important things in these concepts are the materials that need to be used, respectively the development of recycled materials in the second horizon and of smart materials in horizon three.

The development of these materials begin some time before the launch of the clothing lines.

To achieve these technological developments, partnerships have to be made and specialist teams have to be organized.

These resources are very important to reach the goals set in the roadmap. For example, the cloud software development and the programming team for the artificial intelligence system needs to be developed by outsourced specialists. The recycling system also needs to be set-up in collaboration with a partner company.

Once all of this has been developed, Tommy Hilfiger can create in-company teams to work on the production of recycled fabrics and the development of smart materials by an innovation team. More information about the partnerships can be found in appendix [...]. roadmap, can be identified. To make our products work the way it is intended to, technological advancements have to be made.

For example, for the in-store and website experience, software needs to be developed. This cloud software needs constant updating when new features and clothing lines are launched.

Regarding the development of artificial intelligence, quite some steps have to be made. In the first horizon, as mentioned before, the data for later use needs to be gathered. In the first part of the second horizon, the software for the recycling system needs

to be developed. In the second part of this horizon, this system can be used to predict the inventory and the recycling behavior.

This is where the data from previous phases comes in and where the system starts to learn and develop from ‘machine learning’ into AI. In horizon three this evolves into the complete system, where it can be used for predicting the modular inventory, new styles through these modules and the recycling behavior of modules. Besides these digital innovations, some of the most important things in these concepts are the materials that need to be used, respectively the development of recycled materials in the second horizon and of smart materials in horizon three.

The development of these materials begin some time before the launch of the clothing lines.

To achieve these technological developments, partnerships have to be made and specialist teams have to be organized.

These resources are very important to reach the goals set in the roadmap. For example, the cloud software development and the programming team for the artificial intelligence system needs to be developed by outsourced specialists. The recycling system also needs to be set-up in collaboration with a partner company.

Once all of this has been developed, Tommy Hilfiger can create in-company teams to work on the production of recycled fabrics and the development of smart materials by an innovation team.

More information about the partnerships can be found in the chapter ‘Resources’.

57

58 Appendix

Appendix 9 - Values Because the roadmap shows a future vision concept that both affects Tommy Hilfiger as the ‘business’ and Tommy Hilfiger’s customers as the ‘users’, it should be determined per horizon in which way it affects either of these parties involved. There are many values that may be used to describe the underlying importance of the developments. Keeping in mind the business analysisanaylisis, target group and market analysisanaylisis (chapter X, D, Z), there has been selected a number of values per horizon explained in the following sub-chapters.

Business values Making your customer aware of certain changes improving the responsibility of your brand mainly focuses on creating trust for your brand. The newer generations want to see ‘the face’ behind the company, and know whether their trustworthy and honest (see target group chapter 3). For the brand it is important that they build up this trust so that the customer becomes brand loyal and stays involved through developments and changes. Moreover, in combination with the desire to be responsible, comes the desire to be efficient. Especially if it concerns efficiency in use of materials and fabrics. Finally, innovation is added as an important business value. Addressing sustainability challenges demands while also bringing great opportunities for innovation from creation of value to product and service delivery. Innovation is thus inevitable while focusing on sustainability and responsibility, and will be of

great value for the business (Basile et al., 2011). To conclude, the values considered are: trust, responsibility, loyalty, efficiency and innovation. See chapter 5 for a more detailed explanation per horizon which values occur.

User values While business values are obviously relevant for the future concept of Tommy Hilfiger, user values may be just as relevant if not more relevant than the business values. Users, especially generation Z users, tend to care more and more about sustainability and responsible consumerism (see target group chapter 3, appendix X). With responsible consumerism, contribution occurs as well.

Being able to personally have an impact can be of great value for users, and it might even create a feeling of empowerment.

Moreover, the ‘authenticity’ and the ‘story behind’ are significantly relevant for generation Z, creating the desire of wanting to experience instead of just consume and stand-out with the things they actually do consume (see target group chapter 3, appendix X). To conclude, the values considered are: identity, responsibility, contribution, experience, standing-out and empowerment. See chapter 5 for a more detailed explanation per horizon which values occur.

59 Appendix

Appendix 10 - Business Models 2018 - 2020 Create a sustainable brand to raise awareness under customers about the sustainable brand.

Sustainable brand image (continues within horizon II & III & future) With creating a sustainable brand image, Tommy Hilfiger creates more awareness towards their customers and show how sustainable they are. In 2020 the cotton of TH is 100% sustainable and the next challenge will be to make people aware of this. By adding a exclusive (& temporary) line of clothing that explicitly shows that tommy is sustainable, this awareness can be created.

Network Effect Model With the Network Effect Model, TH uses influencers -such as Gigi Hadid- that make the sustainable brand more known. With this increasing notoriety, more people will find it important to wear sustainable clothing and especially from TH and the value of the sustainable brand will increase. The more people that wear the special sustainability line of TH, the more people will gain awareness about sustainability and the brand image will change.

2020 - 2025 Add transparency & recyclability to let customers contribute and create acceptance towards smart technology.

Recycle model (continues within horizon III & the future) With the ‘exchange and refurbish’ model, TH makes sure that they use the leftover materials efficiently by refurbishing them into new pieces. This creates a profit for TH, since they don’t have to buy new fabrics all the time, but also puts them on the map as a sustainable brand in multiple ways. This will result in a changing brand image towards a more sustainable brands with new insights. A big investment has to made in order to regulate this exchange and refurbish model.

Recurring revenue model With the ability to recycle clothing of TH and getting a piece of the same fabric in return for a lower price, TH secures the long term contract with the customer. The clothing is now not only of high quality and sustainable, but once you are done with it, you get a discount in return for recycling the piece at TH. This will help TH to make sure customers come back if they liked the brand. Once influencers are using it, it will also be known as a cool way of dealing with your old clothing.

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2025 - 2030 Add a smart materials and refurbishing line to empower the customer ‘Recycle’ becomes ‘direct refurbish’ (continues within the future) With keeping innovating, TH takes their recycle model to another level. The clothing can be changed instantly into a new color or an adjusting model by re using the fabric or adjusting a smart material. This will be done by using robots that can adjust a piece into the newest fashion trend. TH goes further in the recycling part and keeps the brand image of an innovating and sustainable brand. With this new approach comes also an investment of buying these robots, learning them what to do and an investment in the purchase of smart materials.

Premium model The small line of smart material clothing will appeal to brand conscious customers, since it shows the innovative and sustainably side of TH. It shows that they will keep innovation in order to change the way we produce and use clothing.

2035 - Future Vision Pay-per-piece becomes Pay-per-module The different pieces of clothing will be divided into smaller pieces we call ‘modules’. By making every piece consist out of module, it will be easier to repair, become more durable of be personalized over time. The marge for TH is bigger on just one module, since from the customer’s perspective it will always be cheaper and more sustainable than buying a new one. This also means that TH will have to create a big stock of different modules.

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Appendix 11 - Resources Tommy Hilfiger as a fashion brand doesn’t have a lot of knowledge about technology and IT. At least it is certainly not their core competence to implement IT in a company. The future will force every branch to adapt to new technologies and recognize the added value they can bring. A lot of technologies can improve the fashion industry and contribute to a new era of fashion.

Therefore, Tommy Hilfiger needs resources to support them with implementing technologies into their industrial environment. It is very important for a big company to keep its core competencies, this is why some resources should be outsourced.

AI programming Team(outsourced) AI is one of the most important technologies we use in our roadmap. Since fashion brands don’t have a lot of knowledge about implementing IT, Tommy Hilfiger needs partnerships with companies to ensure a responsible and sustainable use of new technologies. For instance, there are companies like AIBrain or Banjo ((AIBRain, 2017);(Banjo, 2017)). These companies dispose about a lot of knowledge in the field of AI and could support Tommy Hilfiger.

Cloud Software(outsourced) The cloud software, used to collect data from stores and the website, is also an IT technology. A lot of companies know how to deal with cloud computing,startups as well as established companies among these. The expertise of a company like IBM also includes implementing these kind of software in other companies and could provide Tommy Hilfiger with the right software(IBM,2017).

Local Recycling Logistic team(outsourced) Tommy is already recycling a lot of their waste and leftover garments (Tommy Hilfiger, 2017), but to realize our roadmap vision they still have to improve. The idea is to implement a circular process of recycling old clothes. Customers bring their old tommy clothes to the store. Then Tommy sends then to the production plants for recycling and to produce new garments out of it. Therefore, it is important to get expert advice about logistics and support for implementing the circular recycling supply chain.

Production of Recycled Fabrics Tommy Hilfiger already started to recycle garments. There are facilities they use for recycling (Tommy Hilfiger, 2017). Probably they have to extend and develop their recycling plants to ensure a seamless transition to the recycled fashion line.

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Smart Material Innovation Team Smart materials will play an important role in our future roadmap.

Tommy Hilfiger should implement a special team that develops the smart material to ensure to reach the goal to extend the lifecycle of the clothes. Since garments and clothes are the core competences of Tommy they should try to develop new technologies in this field. An option could be to collaborate with universities or research centers to find new innovations.