Skip to main content

Retail

How is Blockchain Changing The Retail Sector?

Blockchain isn't just having an impact on B2B sectors; it's becoming increasingly visible and influential in the B2C industries too.

SECTOR USES

How has Blockchain technology assisted businesses that are involved in selling consumer goods and services?

  • DIAMOND VERIFICATION

    Diamond Verification

    The provenance of diamonds is verified using a paper based certification system. But now Blockchain technology is being used to give each stone an additional uniquer identifier, calculated using 40 data points in addition to the traditional 'Four Cs' of diamond classification - cut, colour, clarity, and carat. Diamonds over 0.16 carats also have a serial number inscribed on their girdles during the grading process. The platform is partially public – all diamond certificates can be cross-referenced on Bitcoin’s Blockchain – and partially private, with sensitive data (such as police reports and policy information) kept on the company's Eris-run platform.

  • OWNERSHIP & ATTRIBUTION

    Ownership and Attribution

    The internet can provide a great platform for artists and other content creators to publicise their work. But its openness also leaves them at risk of having their work plagiarised or used without permission or appropriate credit, resulting in a loss of income. A digital timestamp recorded using Blockchain technology allows artists and creators to establish ownership of their work on a decentralised database.

  • SUPPLY CHAIN TRANSPARENCY

    Supply Chain Transparency

    Consumers are increasingly concerned with ensuring that the food they buy comes from responsibly-managed sources. They want to know, for example, that the fish in their fish and chips was sustainable caught. Blockchain technology allows for the transparent recording not only of how fish was caught (e.g., pole and line), but also its freshness, and whether it has been handled in compliance with social and environmental rules and regulations throughout the supply chain. This is obviously not just applicable to fish, but other consumables too, for instance organic fruit and vegetables. Provenance is one company spearheading such a system, helping to promote environmentally sustainable production and social good.

  • CORROBORATING PROVENANCE

    Corroborating Provenance

    Any retailer needs consumers to have trust in its brand if it is to be successful, and the transparency of the Blockchain can help retailers build and maintain this trust. Building a network of ‘trustable facts’ ensures a better buying experience for customers and should, theoretically, raise the retailers' standards. Provenance, for example, has developed a Blockchain project that tracks fish supplies from sea to plate, documenting where and when the fish were caught and monitoring the catch. This ensures that any claims of a fish being organic can be verified – essential for an increasingly discerning buying public.

COMPANIES USING BLOCKCHAIN

Which retail businesses and brands have been at the forefront of Blockchain technology implementation in their sector?

  • Provenance

    Provenance uses Blockchain technology to document the supply chain of materials, ingredients, and products to provide consumers with greater transparency about their authenticity and origin. Its use of the technology - in the format of a real-time data platform - allows the end user to see each step of the journey the product has taken: where it is, who has it, and for how long. Producers can benefit from this increased authenticity when telling the story of their goods.

    "What we see is really exciting with the blockchain in that there is finally a method of perhaps gathering this data from far-flung areas where products are being produced and having that connected to an open ledger that isn't governed by anyone... so, it can be committed there and also help people who are already gathering that information to do so in a more interoperable way from the get-go, such as certificates, for example."

    • Provenance
      Jessi Baker - Provenance CEO

  • Everledger

    Everledger is a permanent register for diamond certification and related transaction history. It provides verification for insurance companies, owners, claimants, and law enforcement. According to the company, £45 billion is lost annually in the US and Europe as a result of insurance fraud while £100 million is paid out annually in relation to jewellery theft. Everledger’s use of Blockchain technology assigns each asset a unique identifier that is difficult to destroy or replicate. This implementation uses smart contracts, a hybried of public and private Blockchains that delivers the best of both worlds; an accountable and highly secure public Blockchain and the complexity of a smart-contract-enabled private one.

    "Diamonds are just the start, and our vision is so much bigger... We're going to help in combating counterfeiting, and that's not a fifty-billion-dollar problem — that's $1.7 trillion."

    • Everledger
      Leanne Kemp - Everledger CEO

  • Ascribe

    Ascribe is a German startup that aims to "build the ownership layer of the internet". It provides a platform for artists and content creators to create a permanent and immutable link between themselves and their work. Artists can register a piece of work and the number of editions for the piece, transfer ownership of an edition, give someone the right to sell a work on another's behalf (e.g., marketplaces), or loan out the display rights to someone for a fixed time period.

    "We realized that we can use copyright law as the basis of what we’re doing and have that be really easy to use, and use the Blockchain to record these transactions of registering a copyright, of transferring ownerships, of licensing from person A to B, things like consignment or loaning.

    • Ascribe
      Trent McConaghy - CTO of Ascribe

  • Block Verify

    Block Verify is a Blockchain-based anti-counterfeiting solution for pharmaceuticals, luxury items, diamonds, and electronics. It's system enables consumers to ensure that they receive authentic products by working with manufacturers to verify goods and certifying them accordingly. This recording within the digital ledger also means that stolen merchandise can be located, while the technology also reduces the likelihood of fraudulent and counterfeit items making it to market.

    "Bitcoin was originally used to buy illegal drugs. Now we are using the same technology, the Blockchain, to help stop the distribution of dangerous counterfeit drugs worldwide.”

    • Block Verify
      Pavlo Tanasyuk - Block Verify Founder

ISSUES SOLVED BY THE BLOCKCHAIN

Among the first industries to embrace the use of Blockchain technology, the retail sector has already discovered several practical applications of recording transactions in a Blockchain system. These include everything from ensuring the authenticity of high-value products such as diamonds and art to locating stolen goods and protecting both customers and sellers from fraudulent transactions.

  • COUNTERFEIT PRODUCTS

    Counterfeit Products

    Blockchain can be utilised as a public ledger for the registration of all new products and any transactions concerning them. As it can be used to track who currently owns what product, should a duplicate appear on the Blockchain without proper authorisation, it can easily be identified as counterfeit. This is especially relevant to the purchase of rare or high-value goods as, using Blockchain, customers can easily determine whether the product already exists on the system and whether it has been sold.

  • LOCATE STOLEN MERCHANDISE

    Locate Stolen Merchandise

    Blockchain-supported technology like Blockverify can be used to tag products, so that whenever a consumer makes a purchase, they are able to verify its authenticity and activate it within the system. As such, should a product be stolen or go missing, it will be incredibly easy to trace as any subsequent transaction will be recorded in the Blockchain, instantly notifying the legitimate owner of its whereabouts. Naturally, this helps to prevent both sale and possession of stolen goods.

  • VERIFICATION OF PROVENANCE

    Verification of Provenance

    Any retailer needs consumers to have trust in its brand if it is to be successful, and the transparency of the Blockchain can help retailers build and maintain this trust. Building a network of ‘trustable facts’ ensures a better buying experience for customers and should, theoretically, raise retailers’ standards. Provenance, for example, has developed a Blockchain project that tracks fish supplies from sea to plate, documenting where and when the fish were caught and monitoring the catch. This ensures that any claims of a fish being organic can be verified – essential for an increasingly discerning buying public.

  • FRAUDULENT TRANSACTIONS

    Fraudulent Transactions

    While e-wallets offer a certain degree of protection when purchasing products or services online, when a consumer willingly makes a payment by bank transfer the money is often very difficult to recover in the case of fraud. By using Blockchain, however, an escrow system can be created to protect both buyer and seller by not releasing any funds until both parties have confirmed they are satisfied. This process can be confirmed by smart contracts and removes the need for third-party moderation.

FUTURE POSSIBILITIES

What opportunities might Blockchain create for the retail sector in the future?

  • BIGCHAIN

    Bigchain

    The creators of Ascribe have a bigger vision than the one initially set out by the company. This vision is called Bigchain, and instead of just recording the timestamp like the Blockchains does, the metadata of the creative works would also be recorded into the Blockchain, including the artist’s name, the title of the piece, and the type of file (e.g., .png). As all this data would be publicly available, it could be used by libraries and museums and those keeping an archive of the internet (such as archive.org).

  • SECOND-HAND MARKET FOR LUXURY GOODS

    Second-Hand Market for Luxury Goods

    The second hand market for luxury and designer goods is very small. People purchasing used items are not buying them from the original retailer, and paper certification can easily be forged, so it can be difficult to be certain that goods are the real deal. While there are still only a minority of retailers using Blockchain technology as a means of authenticating their products, mass adoption could pave the way for a thriving second-hand market for luxury items. When a vendor wishes to sell on a designer bag all they need to do is produce their cryptographically-signed digital asset issued by the original retailer. The resulting benefits for the luxury market will include a reduction in counterfeit items and a higher degree of consumer trust.

  • ERADICATION OF BLOOD DIAMONDS

    Eradication of Blood Diamonds

    Diamonds that are traded in areas of conflict, and whose proceeds fund war, illegitimate governments, and violence, account for about four per cent of the global diamond trade. Should Blockchain technology become mainstream in this sector, the ability to sell blood diamonds will diminish until it disappears completely - who is going to want to trade in illegal stones? While the recipients of blood diamond funds may look to other insalubrious methods to source their money, Blockchain technology could ultimately be responsible for the downfall of their unwanted regimes.

  • ENVIRONMENTAL ACTION

    Environmental Action

    Understanding where the goods they have bought have come from is empowering to the consumer. It allows conscientious consumers to make decisions about what they purchase based on the supply chain transparency that Blockchain technology provides. Knowing what the consumer wants and the demand for a product will allow businesses to better manage their supply chain. For example, preventing the over-ordering of resources tha results in unnecessary wastage. Controlling and managing resources is also one way in which the retail industry could start reducing the impact its their processes have on the environment.

#RETAIL

#BLOCKCHAIN

"When everything from shoes to crisps are claiming to be handcrafted… You might say we're experiencing a slight crisis in brand trust… We need mechanisms to help broker this digital trust."

  • Jessi Baker -
    Founder at Provenance

“The ownership and transfer of various Blockchain currencies connected to any particular outlet could be used a metric for the health of that store.”

  • Kyt Dotson -
    Editor at SiliconANGLE

"There is finally a method of perhaps gathering this data from far-flung areas where products are being produced and having that connected to an open ledger that isn't governed by anyone"

  • Jessi Baker -
    Founder at Provenance

Blockchain could track your fish supper from boat to plate

24th November 2015

Tracking the provenance of materials is at the centre of understanding whether a product is ethical, but that's not easy with global supply chains... Read more

Blockchain: the solution for transparency in product supply chains

5th July 2015

Provenance enables every physical product to come with a digital ‘passport’ that proves authenticity... Read more

The Blockchain and the retail chain

18th August 2015

The retail shops themselves could benefit from the Blockchain by using it as a tracking system for inventory or by using it to audit information on customer transactions... Read more

Submission

If you know of a practical application of Blockchain technology in the Retail sector or E-Commerce sector that isn’t currently being featured here, please send us your submission. There are many companies and uses of Blockchain technology that we haven’t featured in our initial launch, but we want to build a comprehensive resource outlining the practical applications of Blockchain technology and will be building this resource further in the future.