How Blockchain Technology is Revolutionising Retail
Blockchain is set to disrupt a variety of industries from banking, to education and healthcare; but one of the industries experiencing significant impact is retail. Blockchain technology is revolutionising the retail industry by addressing some of the age-old problems relating to supply chains, logistics and reward programs.
A recent report from Deloitte on blockchain for retail identified as many as 16 specific uses, but here are some examples currently in practice:
Connected Supply Chain
Blockchain technology can provide an end-to-end solution for tracking, documentation, and payment processes. Products can be tracked from point of origin all the way through to the end user, a journey that often involves many parties with competing interests.
Maersk: In a joint venture with IBM, Maersk (the world’s largest container shipping company) is aiming efforts at achieving more efficient supply chains on a global scale. The core functions of the program include establishing a transparent and secure way to exchange real-time shipping data, and the digitisation/automation of paperwork to reduce errors and administrative costs. It’s estimated that paperwork can cost up to one fifth of transporting the actual goods, meaning the program will promote more efficient retail supply as well as more affordable products.
Walmart: The retail giant has been using supply chain trace-ability for many of their produce items to improve consumer trust and gain a competitive edge. Information is shared rapidly through a trusted network, increasing safety and improving crisis management.
Blockchain technology helps verify product authenticity, and movement through the supply chain.
Louis Vuitton: The luxury retailer is using the technology to fight counterfeiting of its luxury handbags. At every stage of the production, supply and delivery processes, a QR code must be scanned to ensure 100% transparency.
DeBeers Diamonds: The company is using a blockchain application to guarantee the ethical sourcing of its stones, which is critical to maintaining consumer trust.
Alibaba: The Alibaba group is utilising blockchain to fight food fraud, where certain products are often substituted along the supply chain for cheaper alternatives to save money. Products are affixed with a QR code and can be traced throughout the supply chain.
Unilever and Sainsbury’s: The global brands are trialing a blockchain system that rewards sustainable tea farming. Price and production information are recorded on tea farmers in Malawi, and if the year-long trial is successful it could benefit 1.5 billion families that depend on small-scale farming worldwide.
Smart Loyalty Programs
Blockchain technology provides a safe way to capture and store customer details for rewarding loyalty, incentivising purchase behaviour and personalised targeting.
Amex: The average customer belongs to 14 loyalty programs and has at least seven cards in their wallet. The financial services giant has built a distributed ledger that allows retailers to tie Amex reward points to their own products. This means that brands can tap into Amex rewards to sell and promote their own products and services without having to set up their own program from scratch.
Internet technologies have transformed the retail industry already with ecommerce, but blockchain will continue to transform it by improving transparency, collaboration, efficiency and integrity.
As blockchain technology becomes more prevalent throughout the retail industry, we will see it be used in other ways, including: tracing stolen goods, consumer protection and managing post-purchase services or warranties, guaranteeing secure customer research, tracking product recalls, simplifying payment processes and the list goes on…