How will blockchain disrupt retail?
Blockchain, the underlying ledger technology behind bitcoin, landed on numerous prediction lists as one of retail’s transformative technologies for 2018. While many focused on blockchain’s potential use in the supply chain, a newer focus is on marketing.
A method of recording, safely storing and tracking complex digital transactions, blockchain’s major advantage is that, once a record is made, it cannot be altered.
Microchips utilizing blockchain can help manage product safety, authenticity and ethical standards across an item’s history.
“Blockchain can help retailers garner greater trust and brand loyalty throughout the product lifecycle, as it can tell consumers not just where an item was made, but also who it was made by, the conditions they worked in and how much they were paid,” wrote Kati Chitrakorn for Business of Fashion. It can also detect interruptions or bottlenecks so that retailers can re-route shipments or advise customers of delays.
A new IBM survey of 203 organizations in the consumer industry found only 18 percent currently using blockchain, but almost 70 percent expect to have a blockchain production network within three years. The top areas blockchain is expected to benefit: product safety and authenticity, supply chain optimization, finance/operational processes, regulatory compliance, promotional strategy management, customer engagement and co-creation.
On the marketing side, blockchain has been touted for its potential to improve the selling and buying of ads across exchanges as well as to reduce the complexity of loyalty programs. But the technology also holds promise for transforming collaboration between customers and partner.
“Wherever there is a need for verified data sources, blockchain can take center stage,” wrote Vanessa DiMauro for Customer Think. “From pharmaceutical companies being able to learn from patient experiences in aggregated and protected ways; to doctors sharing select pieces of research data with other researchers; to the ability to pay for user generated content and influencer marketing activities with a single safe click, blockchain has it all.”
In its “2018 Industry Predictions,” Advertising Age wrote that, while 2018 likely won’t see mass adoption of blockchain, “its ability to provide three solutions to problems as old as digital advertising itself — transparency, authentication and auditing — means this year, marketers (those who have yet to) will sit up and take notice.”
- 5 Technologies Transforming Retail in 2018 – Business of Fashion
- Blockchain reinvents the consumer experience – IBM
- Blockchain for the supply chain – Retail Leader
- 10 Digital Marketing Predictions for 2018 – Customer Think
- Ad Age’s 2018 Industry Predictions – Advertising Age
- What will blockchain mean for retail supply chains? – RetailWire
DISCUSSION QUESTIONS: Where do you see the largest potential for the use of blockchain technology in the retail eco-system? Which applications of the technology are you particularly interested in following?