What’s the Story?

This report forms part of our Innovator Profile series, which focuses on emerging technologies that are disrupting traditional retail and fueling innovation across the retail value chain. Coresight Research collaborated with each covered company to offer insights into their business models and offerings. In this report, we profile Savitude, a provider of digital ideation and design solutions that leverages analytics and artificial intelligence (AI) to improve the efficiency of fashion design while enabling designers to continue expressing their creativity.

Why It Matters

As designers continuously look for ways to leverage AI and analytics while maintaining creativity and strong aesthetics, the addressable market for Savitude appears large. The company estimates that there is an $81 billion total addressable market for its solutions. The company sees six major components of its addressable market:

• Utilization within Brands and Retailers ($2.8 billion): This segment represents potential revenues from retailers and brands that use the design studio in their design process.
• On-Demand/Consumer Co-creation ($33 billion): This segment of the market contains potential revenue associated with providing consumers the ability to customize and design their own clothing, and assumes 5% fees and full penetration of the current e-commerce and in-store segments.
• License Fees of Designs ($28 billion): This segment includes potential licensing revenue for the company based on providing a library of designs and patterns to designers for a $15 fee.
• Influencer Market ($12.5 billion): This segment of the market includes potential revenues from providing influencers with designed capsule collections for a $10,000 fee every 10 months.
• Online Community ($3.2 billion): This segment represents potential revenue from creating an online community of fashion enthusiasts paying a $7 monthly fee to be able to post and view design creations on the Savitude platform.
• Home Sewers ($2.1 billion): This segment contains potential revenue from consumers who would pay to have the opportunity to design and create their own special occasion items such as wedding and prom dresses.

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Figure 1. Breakdown of Savitude’s Total Addressable Market (USD Bil.) [caption id="attachment_122992" align="aligncenter" width="700"] Source: Savitude[/caption]  

Savitude: In Detail

What Problem Is the Company Solving? Savitude aims to solve longstanding problems for both consumers and fashion designers. The company’s solutions can help consumers find clothes that fit them well and complement different body sizes and shapes. Savtude’s fit solution can help designers better design products that are suited to consumers of different body types and reduce returns that are costly both to retailers and the environment. The company’s digital design suite powered by AI can also help designers speed up the design process and find new inspiration, helping them keep up with increasingly fast-changing consumer demand.   How the Covid-19 Pandemic Has Impacted Business Savitude adapted well internally to pandemic shifts, pivoting quickly to work-from-home thanks to the fact that the company was already accustomed to remote work—it has been bilocated since its founding, with its headquarters in Palo Alto and engineering department in Ann Arbor. The company realized quickly during the pandemic that for most retailers, it was not the time to develop new products, but rather an opportunity to create new methods to help advance the industry. The pandemic motivated Savitude to fully develop its concept of customer-driven design that it plans to integrate into its business in the future. The company’s Design Studio can also be used by retailers to refashion excess inventory left unsold by the pandemic, helping to reduce any excess stock that built up during lagging sales through the pandemic. Case Study Savitude worked with SUPERKIN, a maternity fashion brand, to improve design efficiency. Savitude’s Design Studio was able to help the brand produce its fall product assortment four weeks faster than planned, and the company estimates that it saved the brand thousands of dollars during product development. Competitive Advantages Savitude has three main competitive advantages in the field:

1. Savitude enables brands, designers and influencers to incorporate trends, inspiration and “brand DNA” (the unique look and feel that runs through all of a brand’s products) seamlessly into designs. Unlike existing technology, Savitude’s design solutions help designers to not just ideate more efficiently, but also more creatively.
2. The company’s solutions promote designs that are tailored to a multitude of body shapes, enabling designers to break from the traditional mold of focusing on the hourglass shape and optimize products for consumers of all shapes and sizes. This can help reduce costly returns made by consumers who do not like the fit of clothes. In a November 2020 survey, Coresight Research found that more than half of consumers who had returned a product in the past 12 months had returned clothes, mostly due to poor fit.
3. By digitizing and optimizing the design process, Savitude can help promote sustainability in fashion. Fashion currently accounts for 10% of the world’s emissions, to the increasing ire of stakeholders who continue to become more focused on sustainability. Brands and retailers can reap significant benefits from emphasizing sustainability: 56% of global consumers report being willing to pay, on average, a 35% premium for sustainably made products, according to a 2020 survey by the National Retail Federation.

Upcoming Developments Savitude plans to add two new features to its solution set in the first quarter of 2021:

• Custom asset libraries: This new solution will enable brands new to Savitude to upload their design archive to the platform. Savitude’s Design Studio will then automatically “disassemble” the design details from these archived designs and form a unique library of features customized to the individual brand.
• Unique design details: This feature will automatically analyze inspiration images uploaded by users, extract patterns from those images and reinterpret the patterns onto cloth, creating an original design that designers can leverage.

What We Think

Consumers are increasingly expecting brands and retailers to provide clothing that flatters all body types. Additionally, fashion cycles have accelerated, making the ability to design efficiently especially pertinent. Savitude’s solutions can enable brands and retailers to address both of these issues while maintaining creativity and strong aesthetics, positioning the company well to play a significant role in ideation and design moving forward.