Luxury brands like Louis Vuitton and Gucci are everything a shopaholic would want. These brands have been classified as the cream of brands that have kept them as the most wanted items. Thus, with the most durable materials and elegant designs, it is hard to resist them.
However, as prices are exorbitant, fake products similar to these brands have begun to exist. These duplicates have been created with so much similarity that it becomes very hard to draw a line between the original and fake. Therefore, the notion of Blockchains became the best solution to tackle this problem at hand.
Fake products and its’ impact on the originals
As mentioned in my previous article, most of these luxury products are hard to afford for a vast majority of people. These products have been aimed at the high-class society who can afford them.
However, the rationale behind this high price is that these brands focus on customer satisfaction, experience and are very committed to each product that is released. The quality of products is always top-notch which is why the price is a bit steep.
Due to this pressing factor, many duplicates have been created so that others can buy these products as well. In many Asian countries like India, streets are filled with fake and original products that even consumers are not able to distinguish them.
In fact, the duplicates come in various categories often sold as original for higher prices but affordable than the originals. Statistics reveal that counterfeit markets earn up to $450 million a year.
As discussed in my previous article, the issue is that since these products are given at a lower cost, they tend to be of low quality. This, in turn, ruins the reputation of the original that negatively impacts the brands. Therefore, due to this rising concern, customers and business partners as well lose the trust that they have of these luxury brands and end up demanding for refunds or exchanges.
The worst-case scenario is when they completely stop using the products and give negative reviews that tarnish the image of the brands.
On the other hand, these luxury brands fail to create more unique designs and neglect to think of the betterment of them. Rather, they end up spending time and money solving these quandaries that are a nuisance to them.
Blockchain Technology as a solution
The Blockchain technology is designed to bring in more transparency to products which proves the authenticity which is what the customers now look for. The one factor that consumers now look for is the sustainability of products along with authenticity.
This is due to the increased vulnerability of paying more and getting their hands on fake products. Consumers are even willing to pay more if the goods are more durable which was revealed in the 2015 Nelson Global Sustainability report. Thus, thanks to Blockchain, it shields these brands from the eyes of fake producers.
One of the blockchain technologies that is worthy to discuss is Curate. It is a decentralized app that gives digital tokens when scanned gives the history and origin of the product. This is vital because most of these luxury brands have set high prices because they do not compromise on quality which fake producers do.
Brands like Gucci and Zara have begun using this for the benefit of the consumers. Therefore, customers are protected from being exposed to fake producers or buying duplicate products.
This Curate project uses a remote frequency identification system that uses RFID smart tags which assures the authenticity and genuineness of the products. You can scan codes and even see the history of garments or fabrics.
Another plus point is that it rewards consumers with crypto currencies when they contribute to the platform. You can give positive votes and reviews so that it increases the credibility of the brands and this reward system ensures that the platform is a transparent community not plagued with counterfeits.
This, in turn, increases sales as well since it portrays the genuineness of products particularly of luxury brands like Louis Vitton which always tends to fall into the hands of fake producers.
Louis Vuitton’s AURA
Another concept that was introduced by the owner of Louis Vuitton is the Aura which is built using Quorum. It is an Ethereum blockchain and began on June 2019. This was created to track and authenticate luxury goods. This platform will initially be used by Dior and the luxury handbag brand Louis Vuitton. It will then be open to 60 other luxury brands as well. It is a private blockchain that was developed by JP Morgan and aims to enhance privacy.
Through this platform, customers can see information about the products and the materials used. In this way, users will know the genuineness of the products and its originality will not be an issue. You can even trace the origin from the raw materials until the point of sale and it also protects from fraudulent ads. It is, in fact, the best way to enhance brand authentication.
However there is no specific app for Aura, but it will do its’ job veiled behind the app of the luxury brands. In a market filled with counterfeited products, Aura is a vital tool to ensure the credibility of original products.
The blockchain technology is a great approach for tracking the genuine product and handling counterfeit markets like India and China who have a history of creating fake products that are very much similar to the original brands. Therefore, Blockchain technology is the remedy to the woes of luxury brands and with this technology, one can feel very confident about the future of luxury brands and its’ reputation untouched by fake producers.
If you are interested in hearing more about the future of retail and bloackchain, feel free to contact me at firstname.lastname@example.org 🙂