Stitch Fix Marries AI And Personal Styling To Transform Retail

“We make the luxury of personal shopping accessible.”

- Katrina Lake, CEO at Stitch Fix

What is Stitch Fix?

Stitch Fix is an “E-commerce site for apparel”. It is the world’s online personal styling service where the customer does not have to go through the traditional way of online shopping. There’s no browse pages nor search boxes on the site, and there’s no need to sift around through images of clothing. Instead, you just key in your size and style preferences, and the system recommends the apparel that fits your unique tastes, lifestyles and budgets. The “Fix” is then delivered at your doorsteps in that way you can try the clothes out at the privacy of your own home. 

Stitch Fix blended the art of personal styling with machine learning algorithms to provide a personalized shopping experience. It aims to address the “fit issue” and offer a dress that’s right for the occasion.

The Process

It was excited to see how the system works. During registration, you will be asked to fill out a ten- minute questionnaire about your age, weight, body measurements, style preferences, and pricing constraints . These data are collected and are sent to the recommendation algorithm(AI) and your assigned personal stylist for processing. The stylist then will recommend five items based on the data crunched by the AI. Upon completion of the initial style profiling, you are asked to key in your payment details and your preferred date to receive the “Fix” (a term they use to call the box of apparel and accessories). The fix is shipped to your doorsteps for free, and you are given an option to hold on to what you want and return what you don’t like. However, there’s a USD20.00 styling fee in case you send everything back. If you keep any of the apparels, the styling fee will be deducted from your total bill. What’s great about this experience is when you opt to keep all items in a Fix, an additional 25% discount will be applied on your entire purchase. You also have an option to buy a la carte style or subscribe on a bi-monthly or quarterly basis.

The Secret Sauce

1. Hire people who yearn to create an impact

Stitch Fix, data science team, come from a variety of academic disciplines. It is headed by Eric Colson, the Chief Algorithms Officer (photo on the right). Prior to Stitch Fix, Eric was the VP of Data Science & Engineering at Netflix, an OTT(Over-the-Top) service provider that has AI ingrained into the customer experience. The candidates oftentimes have a quantitative mindset and bias towards action. Eric emphasizes the need for expertise transitioning from theory to practicality.  Somebody who is tenacious, passionate and yearns to create an impact.  He wants somebody who can navigate through an organization to get things done. The candidate must be “Comfortable with discomfort.” 

Leading an organization such as Stitch Fix, it’s difficult to spell out the specific responsibilities of a role. It’s difficult to give a requirements document. To some candidates this is unnerving. People expect the clarity of duties in a requirements document. What the role is going to entail and how it will evolve over the next couple of years.

Many tasks at Stitch Fix have never been done before.  Things emerge organically at Stitch Fix because it’s novel.  It's are pioneering new grounds.  They hire candidates who are comfortable with ambiguity. Comfortable with phrases like “Well figure it out.” Stitch Fix needs full stack data scientists to do more iterative processes, avoids coordination cost and wait-time nightmare.

2. Leverage on Data Science

The Stitch Fix’ Data Science team works on a recommendation algorithm along with advice from human processors called Stylists.  Machine learning excels in doing complex calculations but lacks empathy and required human skills like managing relationships. That’s where the skills of Stylists come into play.

There are about 100 algorithm developers at Stitch Fix, And 5 of them focuses on the recommendation system.  There are other algorithms that contribute to Stitch Fix’ competitive advantage like Logistics, Apparel design, Inventory and demand management systems. This wouldn’t work smoothly without a dynamic organizational structure. Part of Stitch Fix algorithm team aligns with the other groups like marketing and styling to promote a sense of collaboration and continuity . The exercise boosts an open flow of ideas and communication.

Data is the key to sustainable company growth and data serves as a lever. The organizational structure acts on the lever so Stitch Fix can completely utilize the data and algorithms. Its organizational structure brings data science at par with the other essential business functions.

3. Deploy a feedback system

The key to improving customer satisfaction is to ask for constructive customer feedback. Knowing the reasons why a customer is returning an item is crucial. Gathering such feedback helps the company identify the system flaws and understand what the customers really want. It helps improve the efficiency of the algorithm. It also helps the stylist discern your specific preferences .  When a customer returns an item, it may be because of the following reasons: fit, colour, fabric, or price. Over time, when the feedback loop reaches its saturation point, the system will be optimized, and the customer’s expectation is met.  It’s a win-win situation for both parties.

The Takeaway

"Stitch Fix is at the intersection of Retail and Big Data."

-Jon Fortt

With over 100 data scientists and about 4,000 personal stylists, Stitch Fix is rapidly growing. It’s great to witness how start-ups are taking advantage of the new technologies. When AI matures, we will see less personal stylists working for each Fix. While we know that the number of active users grows significantly (now at 2.7 M), we want to see a more intelligent algorithm that can adhere to the demand.  

How many personal stylists do you think will Stitch Fix have in the next 5 years? How many data scientists? Will the model be the same? I'd love to hear from you. Share your thoughts in the comments section below.

Photos courtesy of Stitch Fix

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About the Author:

JOVEL M. CIPRIANO

Creator at JovelCipriano.com

Jovel’s 20 years of experience in the field of IT and Entrepreneurship is the driving force behind his successes. He is a sought after authority in the fields of Entrepreneurship, E-commerce, Internet Marketing, and Export. This ex-IBMer has earned global recognitions from the WTO, APEC, and the UN. Jovel graduated from the University of the Philippines with a double degree in Computer Science and Tourism. In his spare time, Jovel enjoys adventure sports such as surfing, scuba diving, and mountaineering. He loves traveling, playing guitar, and exploring exotic local cuisines.

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