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Blockchain technology is being used in luxury retail industry

April 10, 2020

Have you heard about blockchain in luxury industry or blockchain for luxury goods? This is a new use of blockchain technology in the luxury retail industry which we will discuss in this article.

 

Luxury brands are investing in blockchain technology
Luxury brands are investing in blockchain technology/ Ph: Pexels

 

As you might already know, blockchain offers reliable tracking and authentication in the financial market. However, how can the luxury blockchain technology help fight luxury goods counterfeiting and support the growth of online secondhand marketplaces? Let’s figure out in this article.

Blockchain helps luxury goods authentication easier

 

There has been a rising concern over the authenticity of pre-owned goods due to the growth of luxury resale. This market remains mostly unchecked with no real laws enforced. The 2018 Global Brand Counterfeiting Report stated that luxury brands lost about $30.3 billion worth of sales to counterfeits online only. Because this market is built on trust and transparency, the online luxury resellers will be criticised for authenticating luxury goods every single time. Also, there are more luxury goods which is known as  “super fakes” in the market and they become more sophisticated in appearance. This makes it harder for luxury brands and secondhand retailers to be counterfeit-proof. That is the reason why secondhand luxury platforms are now increasingly investing in quality check and authentication experts, including blockchain authenticity verification as well as blockchain authentication and authorization to provide a safe and reliable platform for affluent consumers.

How does blockchain authentication work?

 

Originally developed for the digital currency, blockchain technology has now found new uses as blockchain product authentication or blockchain authentication system. So how is authentication done in blockchain? In this case, blockchain can act as an official keeper. It enables unfailing traceability and recording throughout the entire product’s journey. Louis Vuitton’s parent company, LVMH, has partnered with Microsoft and ConsenSys to announce the launch of AURA, a blockchain-based platform for authenticating luxury goods. Each luxury product is given a unique identifier during manufacturing. When customers purchase an item, they can access its online certificate. AURA helps consumers to access a luxury good’s history and digital proof of authenticity.

As the luxury resale market is growing, the use of blockchain for luxury fashion is becoming a necessity for any luxury brands.

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