When AI Solves an Actual Problem: Fashion's Return Crisis
Fashion retailers are increasingly turning to AI to solve the issue of rising product returns, a persistent drag on profitability and something many in the industry refer to as its "silent killer," and while tech companies have attempted to solve online fit issues since the 2010's, the rapid development of generative AI has finally made these applications good enough to meaningfully impact retailers' bottom lines, with the U.S. National Retail Federation estimating that 15.8% of annual retail sales were returned in 2025, totaling $849.9 billion.
Catches has developed a platform that allows users to create a "digital twin" to try on clothes virtually with what it calls "mirror-like realism," with the application going live last month on luxury brand Amiri's website for a select range of clothes, and unlike other models that "just look pretty," the Catches platform incorporates the physics of fabric texture and how material interacts with a moving body.
My Take: This is AI doing the unglamorous but economically valuable work. Returns are destroying retailer margins, but virtual try-on has been promised for years without working. The inflection point is physics simulation—Catches isn't just generating pretty images; it's modeling fabric behavior. Catches projects that its app can drive a 10% increase in conversions and a 20- to 30-times return on investment for brand partners, focusing on luxury brands because of their higher price point. This is the kind of "boring" AI application that generates real, defensible revenue.
