Fashion industry media platform The Business of Fashion has released The State of Fashion 2026: When the Rules Change report. 

Key insights:

• Forty-six percent of executives expect industry conditions to worsen in 2026, an increase of 8 percentage points over 2025.
• Trade disputes rank among fashion leaders' top three risks, while 76 percent say tariffs will be the biggest issue defining 2026.
• Executives cite artificial intelligence as the biggest opportunity for the industry, surpassing other business priorities like product differentiation and strengthening sustainability.

The 10 fashion industry themes that will set the agenda in 2026:

1. Tariff Turbulence

• USA tariffs are reshaping global trade as higher duties push up costs across the value chain, heavily impacting fashion.
• Brands are making price changes, shifting sourcing and improving efficiency in a bid to counteract the impact. Larger suppliers are pursuing footprint optimisation, digitisation and automation, while smaller players face mounting pressure.
• Agility will be the defining factor enabling brands and suppliers to maintain their competitive edge.

2. Workforce Rewired

• Artificial intelligence investments are set to drive productivity, meaning some existing positions will become AI-centric and new roles will emerge.
• Fashion leaders must prioritise upskilling their workforces and acquiring new talent to stay competitive.
• Strong change management will be critical to capture AI’s full potential.

3. The AI Shopper

• In the years ahead, autonomous AI shopping agents may act on the customers' behalf, completing tasks from monitoring prices to buying products.
• To ensure their products are visible - and favoured by - AI models, brands must rethink their digital marketing and e-commerce infrastructure, where semantically rich data and API-accessible content will be critical to success.

4. Jewellery Sparkles

• With unit sales growth outpacing all other fashion categories, jewellery’s bright moment is set to continue into 2026.
• The category will keep reaping the rewards of a growing customer base with a desire for long-lasting investments, self-expression and treating themselves.
• As jewellery cements its role as accessories centrepiece, fashion players will seek to capture their share of the category’s outsized growth.

5. Smart Frames

• Style-conscious devices equipped with multi-modal AI are set to redefine the wearables landscape in 2026, with smart eyewear emerging as a leading format.
• Major players already have product launches scheduled, reflecting strong market momentum.
• With the category projected to exceed $30 billion by 2030, brands have a timely opportunity to partner with technology leaders to unlock high-value consumer use cases and accelerate adoption.

6. The Wellbeing Era

• Wellbeing is becoming central to how consumers live, spend and define themselves.
• As they tire of attention-grabbing content, they are drawn to brands that reflect their shifting identities and offer them emotional connections.
• Fashion brands are responding by entering wellbeing-adjacent “third spaces,” but further opportunity lies in integrating these shifting priorities more holistically across the brand universe.

7. Efficiency Unlocked

• In a challenging fashion market, companies must become more efficient to drive growth.
• Old advantages like scale and low-cost sourcing are no longer sufficient to sustain a healthy economic model.
• By taking advantage of new technology, businesses can improve productivity to reduce costs, unlocking resources to invest in differentiators that enable growth.

8. Resale Sprint

• Customers are spending more on secondhand fashion in the search for value as prices continue to rise in the primary market.
• Marketplaces have made shopping secondhand mainstream, but brands must now define resale strategies of their own.
• While operational hurdles remain, the lure of untapped revenue will make resale an increasingly attractive way to bolster business models and brand perception.

9. The Elevation Game

• From the value segment up to affordable luxury, fashion brands are moving upmarket.
• Some want to differentiate from ultra-low-cost competitors, while others aim to capture the former high-end shopper squeezed out by luxury prices. With margins under pressure and competition intensifying in 2026, these elevation strategies will gain new urgency.
• Product quality and standout experiences could help brands upgrade their positioning.

10. Luxury Recalibrated

• The luxury slowdown is prompting a phase of strategic renewal.
• Brands are reducing their reliance on price-led growth and refocusing on creativity and craftsmanship to rebuild client trust.
• This recalibration calls for brands to balance the needs of distinct customer segments and integrate product, storytelling and client experience into a cohesive expression of brand value.

For more information, visit businessoffashion.com.