Digital Product Passports: What, Why & How to be Ready

February 14, 2024 . 6 Mins read
  • Introduction

    Ever see a great jacket or dress on the rack and want to ask questions like where did it come from? Who made it? Why does it cost this much? What’s its story? Well, you’re not alone! And soon Digital Product Passports (DPPs) will help you, the consumer, get answers to all of these and more questions about every product you buy.  

     DPPs are becoming a key tool for the global fashion industry to solve the critical challenges of transparency, traceability and sustainability in the supply chain. They aim to help fashion brands address the fast-growing consumer demand for ethical production practices and a clear understanding of a product’s journey.  

    Let’s delve deeper into the world of DPPs, exploring how they work, the technologies behind them, and the transformative impact they could have not only on how we shop but also on how fashion and/or consumer brands operate.  

  • What Is a Digital Product Passport (DPP)?

    A Digital Product Passport (DPP) can be understood as a digital identity for products, designed to provide detailed information about the item’s lifecycle—which can be accessed via digital means, like scanning a QR code or through a digital interface. DPPs are sometimes also called Digital IDs or ‘data carriers.’  

    A recent DPP example from fashion: High-end fashion brand Tod’s gave their Di bags a ‘Tod’s Passport’ (through the Aura Blockchain Consortium) inclusive of ownership certificates and detailed product information. In the future, Tod’s says the passport could also feature benefits like early access to special sales and events, maintenance services, and a digital twin NFT.  

    The general data requirements for DPPs are still evolving and will likely vary by industry, geography, and regulation. However, some key data categories to be collected and shared in a DPP include:  

    • General Product Data: Information like product ID, batch numbers, manufacturing details, and manufacturer ID. 
    • Source Data: Details about the raw materials and components, including their origin and sustainability of the manufacturing process. 
    • Footprint Data: Information about the product’s carbon footprint and environmental impact during manufacturing and usage. 
    • Ownership Data: Information about past and current owners, ownership duration, and event audit trail. 
    • Maintenance Data: Details about the product’s repairability and repair history. 
    • Documentation: Digital versions of warranty, service, and insurance documents. 
    • Instructions: Guidelines for disassembly, recycling, repair, upgrade, reuse or waste management of the product.  
  • History of DPPs – The Digital ID Mandate Is Coming

    The history of Digital Product Passports (DPPs) is closely tied to the broader global movement towards sustainability and the promotion of circular economies. One of the earliest applications of DPPs was in the context of batteries, known as ‘battery passports’, which aimed to provide detailed information about the battery’s composition, origin, and recyclability. The concept has now evolved to encompass a broader array of industries, reflecting an expanding scope and utility.  

     The European Commission is pivotal in driving this initiative forward. As part of the European Green Deal, the Commission has delineated plans to implement DPPs across various sectors by 2026. This initiative aims to boost supply chain transparency and foster sustainable manufacturing practices. Industries like apparel, textiles, and consumer electronics are in the immediate purview of this mandate, with others poised to follow. Exclusions currently apply to the food, feed, and pharmaceuticals sectors. 

     This mandate affects not just EU-based companies but also non-EU brands selling in the EU market, making DPP compliance a global concern. The global nature of the fashion industry means that fashion will see a significant impact as DPPs mandate detailed product information. They will also be a pivotal tool in helping fashion advance towards the circular economy model.  

  • How DPPs Work – Technologies Behind Digital IDs

    Digital Product Passports (DPPs) combine blockchain, QR codes, and RFID technologies to provide a secure and transparent digital identity for products. Blockchain technology’s decentralized nature ensures the integrity and immutability of the product data, making it reliable and tamper-proof. QR codes and RFID tags serve as accessible interfaces, allowing consumers and stakeholders to easily access the DPP for product information.  

    The potential intersection of DPPs with other emerging technologies like AI and Internet of Things (IoT) opens exciting possibilities. AI can analyze the vast amounts of data accumulated in DPPs, offering insights into product usage patterns, sustainability metrics, and predictive maintenance needs. IoT devices can provide real-time updates on the product’s status and usage.  

    How are DPPs created?

    The creation of a DPP begins with the creation of the digital passport at the product’s inception, typically during manufacturing, where essential data such as materials, origin, and production details are encoded. As the product moves through its lifecycle, the DPP is regularly updated with new information. These updates might include changes in ownership, maintenance records, and end-of-life recycling information, ensuring that the DPP remains a living document reflecting the product’s status. 

    Real-world applications of DPPs are already happening, especially in the luxury segment. Fashion brand Mugler partnered with Arianee to embed DPPs in its Spiral Curve bags. Swiss watchmaker IWC Schaffhausen is using DPPs for its luxury watches, providing a secure proof of authenticity and ownership.  

  • What Are the Potential Benefits of DPPs for Fashion?

    Digital Product Passports (DPPs) offer a range of potential benefits for the fashion industry, transforming how brands interact with consumers and manage their supply chain traceability systems.  

    • Traceability and Consumer Trust: DPPs promote supply chain transparency in the fashion industry, compelling brands to adhere to their sustainability commitments. They help consumers make informed decisions aligned with their values. Meanwhile for brands, embracing DPPs early could position them as responsible and sustainable entities, thus bolstering their reputation.  
    • Brand Storytelling: The integration of DPPs into fashion products can elevate the customer experience by giving brands the ability to share a unique narrative history and legacy for each item, detailing its journey from production to purchase. This storytelling aspect not only adds value to luxury products but also creates a deeper connection between the consumer and the product.  
    • Better Customer Insights: In an era where data privacy rules are tightening, DPPs offer brands a new avenue for gathering customer insights. When consumers interact with DPPs, whether through apps or scanning tags, brands can gain valuable information about customer preferences, behaviors, and locations. This data can be instrumental in personalizing marketing strategies and improving customer experiences. 
    • Resale Ownership Certificates: DPPs can revitalize the secondhand market by providing clear and accessible information about product provenance and history, akin to fine art ownership ledgers. Brands like Chloé Vertical, with their recent spring collection featuring digital IDs, exemplify this trend. These IDs facilitate access to product information, repair services, and resale options, though it’s still early to gauge the full impact on customer behavior in the resale market.  
    • Counterfeit Mitigation: Digital IDs can be super helpful in the authentication of fashion products, helping brands combat counterfeiting in the secondhand market. While counterfeiters may adapt to technological innovations, DPPs, in conjunction with human authenticators, can provide a robust system for verifying product authenticity.  
    • Add-On Services: DPPs enable brands to continuously update product information and add new features. For instance, Coach’s Coachtopia products come with unique digital IDs for accessing repair services. Similarly, Boss integrated digital IDs in ski jackets for additional functionalities like slope access and contactless payments as part of a pilot project.  
    • New Business Models: DPPs open opportunities for new business models focused on repair, maintenance, and circularity. This shift could lead to increased popularity in slow fashion and longevity as brand differentiators, fostering stronger relationships between brands and customers and promoting sustainable consumption practices.  
  • How Can Businesses Get Ready for Mandatory Digital IDs

    For fashion businesses preparing for the mandatory implementation of Digital Product Passports (DPPs), there are several key steps and infrastructure requirements to consider: 

    • Centralized, Accessible, and Accurate Product Data: The most crucial preliminary requirement for implementing DPPs is having centralized, easily accessible, and accurate product data. This involves collating comprehensive information about products, including their composition, origin, and environmental impact. Businesses need to ensure that this data is consistently updated and accurately reflects the current state of their products. 
    • Open, Secure, Standard, Interoperable Format: The data for DPPs should be in an open, secure, standard, and interoperable format. It’s important that the data is machine-readable, structured, and searchable to facilitate easy access and analysis. This approach ensures that the information is easily shared and understood across different platforms and by various stakeholders. 
    • Cross-functional Collaboration: Successful implementation of DPPs requires cross-functional collaboration within organizations. Different departments, such as manufacturing, supply chain, marketing, and IT, need to work together to ensure that data is uniformly collected, logged, and integrated. Avoiding scenarios where each department manually logs data in multiple systems is crucial for efficiency and accuracy. 
    • Streamlining Operations with Modern Solutions: Fashion businesses should consider streamlining their operations with centralized, cloud-based product lifecycle, and data management solutions. These solutions should have built-in connectors for Enterprise Resource Planning (ERP) and other software systems to sync data directly from manufacturing partners. This integrated approach ensures that data is consistently and accurately fed into the DPPs. 
    • Preparing for Future Regulations: Once the framework for the information to be included in DPPs is defined, existing systems should be capable of pushing data to traceability/digital ID solutions. Businesses need to stay informed about upcoming regulations and standards related to DPPs and adjust their systems and processes accordingly.  
  • Watch Out for These Challenges of Implementing DPPs

    Implementing DPPs in fashion presents several challenges that businesses need to be prepared for:  

    • Technological Barriers: Integrating DPPs requires a robust IT infrastructure for data management, possibly demanding expertise in blockchain and interoperability with existing systems like ERP software.  
    • Cost: Initial investments in software development, data management systems, and staff training are substantial. 
    • Data Privacy: Safeguarding proprietary information is crucial. Employing data encryption methods like RSA or zero-knowledge proofs is necessary to protect sensitive data while maintaining transparency.  
    • Learning Curve and Change Management: Transitioning to DPPs involves a significant learning curve for employees. Effective change management and cross-functional collaboration are essential for smooth implementation. 
    • Standardization Across Markets: Harmonizing Digital ID systems with diverse international standards and regulations, especially for global brands, could be a challenge.  
  • Summary

    As we reflect on the emerging role of Digital Product Passports (DPPs), it’s clear that while they hold significant promise for enhancing transparency and sustainability in the fashion industry, there are challenges to navigate. But with the right approach and strategic planning, DPPs can become more than just compliance tools; they can be tools for providing real, long-term customer value. 

    Looking ahead, several questions loom large: Will DPPs evolve into indispensable tools for ethical fashion, or become a regulatory burden? How will they shape the interaction between brands and consumers in the next decade? Could they redefine the essence of product ownership and the circular economy? These considerations are vital as the industry moves towards a future where digital IDs will likely become mandatory. 

    For brands preparing for a future dominated by digital IDs, now is the time to get your product data in order. Partner with experts like WFX to get the necessary guidance and tools to ensure that your brand is well-prepared for the upcoming era of mandatory digital IDs. Book a 1:1 call!  

Vishakha Somaniauthor linkedin
Assistant Manager

Vishakha Somani is a Fashion Tech Analyst and Communications expert at WFX - World Fashion Exchange. She is a Fashion graduate from Polimi Italy, and has been actively reporting on the fashion industry since 2016. She's an expert in analyzing trends, market shifts and new technologies. Her work spans forecasting and research on the global luxury and retail supply chain, emerging markets, and the circular economy.

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