Generative AI is fashion’s biggest opportunity — and its most divisive.

Startups, tech giants and everything in between are rolling out AI-enabled features meant to help fashion brands boost their businesses. Meta and TikTok, for instance, both offer AI-powered ad-targeting and content generation, while Shopify’s AI features can swap out homepage displays and generate product descriptions. Using it in marketing is a more contentious choice,** **but brands like Coach, Zalando and Revolve have been able to do so without attracting much ire.

Most of the headlines around fashion’s adoption of AI have focused on major brand names, like H&M and Aerie. For brands that generate less than $100 million in annual sales, the decision to invest in AI — and how to do so — has different stakes.

Smaller brands can more easily integrate new tools without the red tape that stifles large companies’ decision making. At the same time, the most advanced tools, such as AI agents that can automatically replenish inventory, are out of reach for companies with less robust budgets. And a smaller brand usually relies on more of a human touch as they build their brand — there’s a fear that relying too heavily on AI will reduce their control and force their creative muscles to atrophy.

“If everyone’s using the same things, everything’s just going to start to look more and more alike,” said Ethan Glenn, founder of four-year-old menswear brand Every Other Thursday. “We’re already in a world of way too many brands and companies that all do the same thing.”

But founders also fear they’ll fall behind if they don’t integrate AI into their businesses on some level. Alexandra Fine, founder and chief executive of sexual wellness label Dame, compared it to not wanting “to get your company on Instagram” ten years ago.

Small brands are writing their own AI playbook. While some are playing with AI-powered software to refine design ideas or creating marketing prompts, many more are using mainstream tools like ChatGPT to improve operations, like generating product descriptions. If those prove useful, only then will they consider investing in advanced software capabilities like inventory and merchandise planning — gradually.

The hope for most startups is to let AI do the heavy lifting on the back end so they’ll have more time to focus on the creative side of the business — from designing products to crafting brand campaigns.

“We want to get as efficient on the operational processes and the non-customer facing assets of the business so that we can invest more in emotionally engaging with our audience both digitally and in real life,” said Nick West, co-founder and chief executive of activewear upstart Bandit Running.

Introducing AI to Your Brand

Brands investing in AI are starting with large language models like ChatGPT or Google’s Gemini, which can cost as little as $20 per team member a month, to streamline processes or replace otherwise costly services.

Before hiring a real estate broker to scout retail locations for a new store, for example, Bandit Running’s West uses ChatGPT to analyse where its competitors are located and calculate how much he should be paying for the space, he said. The search results aren’t the ultimate deciding factor in the brand’s retail strategy, West added, but it’s the type of use case that is refining the company’s way of working.

“There are limitations to what that output is,” West said. “But we definitely think each person, by using AI strategically, becomes a much more productive and efficient person.”

Brands are also using LLMs for consumer-facing tasks that can help them make more money. Last year, beauty device seller Pure Daily Care started using ChatGPT to rewrite descriptions for product listings on Amazon to target specific customer demographics — think women in their 30s — which resulted in a 10 percent lift in conversion from some of those listings, said Jonathan Cohen, the company’s chief marketing officer. Dame is using AI to help identify newsletters it can partner with as social media platforms have strict policies against advertising sexual wellness products, Fine said.

Some upstarts are adopting AI for more creative endeavours. Since 2024, handbag maker Marina Raphael, for one, has been using video and image-generator Midjourney to create fantastical marketing content: one campaign for the brand’s Spring/Summer 2025 collection depicts a “factory of the future,” including an image of a model standing in front of a conveyor belt carrying a range of Marina Raphael’s signature plexiglass-handled bags.

“You have to be able to take some time out and really make it a part of your culture so that it doesn’t look scary, so it doesn’t look corrosive, so it is ingested as a tool,” said Brent Vartan, managing partner at investment firm and creative agency Bullish, which backs early-stage brands like Bandit Running.

Graduating to Advanced Tools

Once a company’s experimented with entry-level AI programs, it might be ready to solve harder problems like merchandise planning or inventory management. Since these often require more of a financial investment, brands should understand exactly what they’re looking to accomplish before investing.

Samee Ahmed, for example, knew he wanted to update the merchandising strategy for his apparel label Glass Cypress’s website when he started using a service that scans millions of images on social media and identifies fashion trends. The brand uses those insights to determine which products to spotlight on its homepage, a strategy that’s led to an increase in online sales in the last month, Ahmed said.

In certain instances, the right AI software can help brands expand their business. In January, Istanbul-based designer Doğa Keskintepe started using a platform called Refabric to quickly refine designs and create lookbooks for her womenswear line Dor Raw Luxury, which came in handy when she was under a time crunch trying to secure new retail partners across Europe this August. The region is now slated to account for 8 percent of Dor Raw Luxury’s sales in 2025.

“You want to be sure that you’re putting the cost in the right spot and you’re getting a return on it,” said Sonia Lapinsky, fashion lead at consultancy AlixPartners.

Startups are also scoping out AI to fix heftier challenges like managing brick-and-mortar inventory. As swimwear brand Same opens stores in St. Tropez, New York and Miami in the next year, it’s searching for a solution that can track in-store purchases and automatically reorder popular styles before they sell out, said co-owner and chief operating officer Ryan Horne.

But software that handles advanced tasks come at a premium. Horne said that Same could end up spending well over $100,000 per year on an AI-powered inventory planning tool, accounting for at least 10 percent of the brand’s operating budget.

With that, some are weighing if it’s cheaper to outsource or build capabilities in-house before making a final decision. In September, Bandit Running hired a head of data who’s responsible for finding all of the AI-powered services on the market, and helping West and the brand’s finance chief assess whether they should spend on existing software services for operational hurdles like inventory management or create their own AI-powered features, West said.

“The investment in creating the solution is going to be bigger,” Lapinsky said. “Start to think through the different use cases … build a real roadmap.”

Whatever the time and financial costs of integrating AI, it’s likely a greater risk for an emerging brand to not invest in it at all as the technology disrupts the industry at breakneck speed.

“If you’re a small brand and there is an 800-pound gorilla that you need to run through in order for you to grow, this is your opportunity right now, and it is urgent,” Vartan said. “These disruptions don’t come around a lot in business.”