Despite often being equated with Bitcoin, blockchain technology is incredibly elastic. Solutions have been dreamt up for a whole range of sectors, which is not surprising given its value: the ability to independently verify, guarantee total transparency, and inability to be hacked. Ever spearheading the latest technological trends, the fashion industry has designed applications to overcome all too common challenges, resulting in priceless value to brands and consumers. This article will take a look at a handful of benefits – there are plenty more – blockchain technology brings to the world of fashion.
A definition of blockchain
A blockchain is a shared, decentralized database or digital ledger that automatically updates information across an entire network. When information is entered into the ledger, the entry becomes linked to every other entry or “block” and every other copy of the ledger is synchronized. The ledger normally takes the physical form of a cryptographic seal or serial number.
What makes blockchain so powerful is that once data is entered into the ledger, it can never be changed or tampered with. Being decentralized, it also means that everyone can see exactly what is going on. In a world where it is becoming increasingly difficult to ascertain the truth, blockchain advocates facts, authenticity and transparency.
- Reduce counterfeits
By providing a link between physical goods and their digital identity (the ledger), blockchain protects the integrity of the supply chain. Each time the product changes hands, the change of custody is recorded on the blockchain, making it possible to identify the exact moment when a counterfeit is introduced or the original is diverted. Not only does blockchain therefore deter the counterfeit industry and guarantee consumers receive an authentic product, it saves brands the €26.3 billion of revenue lost annually from counterfeit goods in the EU alone.
- Prove origin, sustainability, cruelty-free, etc.
As millennials are buying more and more into brands as cultures – with sustainability, ethical production, cruelty-free and vegan being just some recent trends – blockchain enables brands to verify facts should doubts be raised. Logging each and every stage of the production process in a ledger that cannot be tampered with enables brands to prove, for instance, where a product was manufactured (Made in labels), which materials were used (sustainable, etc.), that products were not tested on animals (cruelty-free), and so on. A powerful way of demonstrating they are true proponents of a certain culture.
- Streamline global supply chains
Shipping from one side of the world to another involves several hundred parties, interactions and documents; a complex system where problems and errors can occur. Blockchain technology can bring all processes together, enabling them to seamlessly interact with each other, and guaranteeing transparency. What’s more, real-time tracking gives brands the power to identify bottlenecks as they begin to develop, not after they’ve become a problem.