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.

Counterfeit italian bags in the street — Counterfeit Italian bags for sales in the street

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.

Conclusion

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 bjorn.nostdahl@gunnebo.com 🙂

Commercial, Fashion, Innovation, Microsoft Azure, Reflections, Retail, Software Development Insights

Microsoft Pivot: Envisioning the Future of Digitalization

May 29, 2019June 5, 2019 Bjørn T. Nøstdahl

May 29th, Satya Nadella CEO of Microsoft invited Nordic customers and partners for a small conference in Sweden, putting forth his ambitions for the future. This was Nadella’s first ever visit to Sweden, since stepping into the shoes of the company’s CEO. He touched upon issues of today’s tech world, but most importantly made Swedish people aware of his company’s firm belief in global digitization and describe what the future holds in store.

Satya_smiling-print-1024x683 — Photo: Brian Smale/Microsoft

Self-discipline & excitement-seeking are two pillars of Satya’s personality, which has made this Indian-origin techy an intellect worldwide; from Asia to Europe we all treat him with the warm welcome.

Dinner with Microsoft’s ISV Team

A day before the Nadella’s address, I was invited for dinner and socializing hosted by Joanna and Martin from Microsoft. ISV stands for Independent Software Vendor and present individual or companies those who develop, market and sell software running on third-party hardware and software platforms such as the Microsoft.

The term ISV is prominent in the tech world, used by most tech companies including Microsoft. To understand this from a layman’s term, when Microsoft was in the pursuit of developing windows, its partnerships with numerous companies/individuals to take their project forward both on the technical and non-technical front.

Next Morning, I had the opportunity to see some of the companies that has implemented their solutions on the Microsoft platforms at hotel Berns. There we received a pep talk to Microsoft and partners on the future and what efforts we need to put to make sure it is heading the right direction.

The Microsoft tech show commenced in style with the tunes of Sweden’s most renowned DJ and Saxophone artist Andreas Ferrronato. His soul-soothing set the mood 🙂

The Volvo Group Digitizing its Operations

Hillevi Pihlblad from Volvo Group talked about how employees hate change and across the globe it is not easy to adapt to changes. Further, she illustrated how the Volvo Group has translated the changes into something positive and made people understand why embracing change can make their lives convenient.

The H&M Group And The Use of AI To Serve Their Customers The Best

A senior executive and business leader of the H&M Group, Arti Zeighami talked about how the company is investing in Artificial Intelligence technology to tailor store offerings. Heading the Advanced Analytics and AI function, he gave a presentation on how H&M Group is implementing advanced algorithms to scrutinize sales an returns. Further, helped them more efficiently predict the needs and demands of their customers.

Satya Nadella, The Man of the Moment Taking The Center Stage

Then, finally came the moment when Helene Barnekow introduced Microsoft’s CEO Satya Nadella. He was treated with great warm claps from the tech people present.

Nadella who took over the job role of CEO from Steve Ballmer in 2014, is globally renowned for his dynamic leadership and a true passion for technology innovations. Prior to being the company’s CEO, Nadella was Microsoft EVP of the cloud and enterprise group.

His journey as a CEO has transformed Microsoft in terms of technology, also accentuating the company’s business model and corporate culture. His emphatic leadership abilities steered Microsoft from struggling smartphone strategy to focus on other technical aspects such as the Augmented Reality and Cloud Computing.

He was also responsible for the purchase of Linkedin, a network of professionals for around $26.2. Did you know since taking over as CEO, company’s stocks have increased by 150%?

The theme of the address by Satya Nadella was how communities and companies are uniting together for the digitized future of Sweden. This speech was largely about Microsoft’s own digital products and services, and how they can drive the world forward.

On his address to the tech people of Sweden, he threw light on various segments of technology-the Artificial Intelligence, Digital Transformation & Innovation. The American giant was in Stockholm to make a big announcement about setting up data centers in the country.

“We have the ambition that the data centers we build in Sweden should be among the most sustainable in the world, this is another step in strengthening our position as a long-term digitization partner for Swedish businesses”

Key Highlights from Nadella’s Address

“It would be wrong for me not to talk about trust. Because in the end, it is something that will be very important to us – not only to create new technology but to really assure that there is confidence in the technology that we create” he says on stage and continues “We need to create systems that handle personal data and security as a human right.”

Satya Nadella talked about the recent investment his company is making in Sweden. Among all the tech things, Microsoft two centers to be built in Gävle and Sandviken, they will be the most sustainable in the world.

“We will use one hundred percent renewable energy. They will also be completely free from operational emissions. We set a new standard when it comes to the next generation data center. It starts here in Sweden,” said Satya Nadella.

Apart from the data centers, Satya Nadella also highlighted the recent key partnerships during his speech at the China Theater. He further talked about company collaboration with Kiruna, this city makes use of Microsoft Hololens and AR to plan the city’s underground infrastructure.

Microsoft in Sweden

Satya Nadella, Microsoft’s CEO Put Forth Examples of Company’s Interest in the Country;

”There have been huge breakthroughs in the last three years, regardless of whether we are talking about object identification or voice recognition. This must be translated into infrastructure. Here we invest heavily.”

“Take Spotify who has a new very cool podcast tool. It lets anyone do their own podcast and they use our speech recognition to convert speech into text. The most interesting thing they do is that for anyone who wants to modify their podcast, they can enter and edit in writing and that the podcast then automatically changes. It shows how to use AI to make it more efficient”

Ending the Visit on a High

Later in the day, Nadella visited the Samhall innovation Days, a hackathon with the aim of “creating the conditions for people with a diagnosis within the autism spectrum to come into operation”, in the company’s press release.

Last summer, Microsoft announced two data centers in Norway to take their cloud computing services to entire Europe.

“By building new data center regions in Norway, we facilitate growth, innovation and digital transformation of Norwegian businesses – whether large companies, the public sector or some of the 200,000 small and medium-sized companies that together create the future of Norway,” said CEO Kimberly Lein-Mathisen in Microsoft Norway when the Norwegian plans became known.

Nadella declared that both the data centers will run on 100% renewable energy, so this project is in the welfare of the country, creating an ocean of newer opportunities for the locals. He also talked about his company’s association with the tech companies/communities in Sweden; one is the Kiruna city and other being the Sandvik Company.

The address at the China Theater in Stockholm by Microsoft’s top boss, Satya Nadella was like a pep talk. He gave his viewpoint on a variety of technology aspect. Most importantly, he announced the company’s program of building two data centers in this Nordic country.

Commercial, Fashion, Gucci, Gunnebo Retail Solution, Louis Vuitton, Retail, Software Development Insights

Why luxury fashion brands like Gucci and Louis Vuitton are flourishing

March 26, 2019 Bjørn T. Nøstdahl

I had a great opportunity to visit London during the weekend, to experience the luxury fashion industry first hand. Whether you want to spend big or just browse, London is a luxury shopper’s paradise, offering everything a discerning buyer could possibly want.

In my opinion luxury brands have been doing so well based on their capacity to react to social patterns. They have figured out how to submerge themselves into the culture and give new dimensions of access that, while retaining their validness and originality, to make their brands increasingly alluring to more clients.

As a result, Luxury brands are increasing their revenue and results, and I think that this is very much due to their focus on the customer experience. They tend to be very commited to every product they put out, as well as being conscious of how the customers react to the product. Best in class are of course Gucci and Louis Vuitton that are among the fastest developing brands on the planet, with the extravagance design and their product developing by 42 percent since 2017.

Not surprisingly, most luxury brands are performing great in a rundown of 100 companies that includes technology, retail products, cars, and financial enterprises.

Photo from press.gucciwatches.com Timepieces and Jewlerry Campaign 2015 with clean and simple styling and Madison Stubbington wearing a slip dress and a no makeup look.

Gucci’s brands are of course the fastest rising of any luxury style name on the rundown list, with up to 30 percent to $12.9 billion, while Louis Vuitton, grew 23 percent to $28.2 billion. The nine luxury brands on the list had a joint brand estimation of $105.8 billion and include other top brands including Hermes, Tiffany, and Co, Dior, and Burberry.

Louis Vuitton – $28.6 billion.
Chanel – $20 billion.
Hermes – $16.4 billion.
Gucci – $12.9 billion.
Cartier – $7.7 billion.
Tiffany – $5.6 billion.
Dior – $5.2 billion.
Burberry – $5 billion.

The global apparel market which does not include shoes and jewelry is worth $1.34 trillion a year in retail sales. Of this, a staggering $300 billion are luxury and premium brands.

How Did Luxury Brands Come This Far?

Building a fruitful business system infers the comprehension of how things are going to change over the span of time. The fate of retail is characterized by the most encouraging patterns we are watching today and is custom-made to the requirements of various gatherings of customers. The organizations which need to prevail in retail in 2030, ought to arrange their business procedures and specialized modernization remembering such significant thoughts as accentuating customers review and experience, guaranteeing flexibility for different target audiences, giving consideration, and remaining cognizant.

Luxury industries have proven to be ahead of all others in all of the aforementioned aspect, and that is one of the many reasons that they do so well. The society is winding up more to be more fashion conscious and its relation to an eco-friendly environment, and everyone is looking at ways to innovate fashion-wise. Consider, for instance, a luxury design brand Elvis and Kresse. The business began as an endeavor to handle a ten-million-ton of Leather scraps which should be discarded in London every year. Presently the organization delivers a full scope of calfskin from what recently was covered in the ground.

Purchasing a luxury item, being a Lois Vuitton NéoNoé bag or a Rolex Perlmutter is also viewed not only buying a bag and a watch – it is a feeling, an experience and a rush. Building on this rush is sharing the experience with Instagram followers, and this, in a nutshell, is how much value these brands have. Dopamine and oxytocin give the shoppers a rush all through the shopping experience.

This is particularly apparent when you are shopping, and you see something that you like (a dose of oxytocin is delivered to your bloodstream) and you get excited about it (a dose of dopamine is delivered to your bloodstream). Hence why these hormones are referred to as “happy hormones”.

Going to the store, you may not have planned to shop for anything at that moment or maybe you were planning on getting something else, but because your body is full these hormones, you end up buying it. This is what people generally call an impulse buy. This is also true when it comes to social media. You could be just browsing through your social media, and you may see something that attracts your attention at once, and then you get excited and feel the urge to find out more about that person, or place or thing. This is the reason why, even though you visit your social media platforms with the intention of just checking in, you end up spending hours on end on that platform at times.

I have to say, going to the Tiffany & Co store at Harrods, you get the celebrity attention and a great feeling just browsing through all their fantastic jewelery. Buying the same piece online or in a common store does not give you the same rush.

Transformation and Progress in The Industry.

The Luxury merchandise industry has faced a number of changes in the course of the last two decades. Right now, fluctuating economic patterns, advanced digital scope and developing customer choices and tastes are making another competitive scene in the industry such that conventional methodologies are under danger. All things being equal, development in the luxury merchandise industry will proceed. However, to come up to a consistent and strong rate of offers development, luxury companies need to look up to new difficulties and manage them ineffectively.

There have been situations of incorporation between two companies or more, like Recently Michael Kors acquired Versace at the last quarter 2018 and Jimmy Choo in 2017, moving them up on the ladder of luxury brands. Keeping Versace chief executive Jonathan Akeroyd and creative director Donatella Versace on is of course extremely important to not devaluate the Versace brand. Such is the manner of competition that is experienced in the luxury industry today.

Ideally, the retailers wants to be focused on shoppers and their shopping journey and behaviors first, and then focus on staff and their activity separately. I am sure that the future retailers has a lot to gain by technologies like IoT, business intelligence (and even artificial intelligence and machine learning) and analysis when multiple data streams interact, for how long, and how they are related to purchase patterns and other performance metrics.

The future achievement of the business will also rely upon its achievement in penetrating and proactively connecting with the more youthful age. Luxury brands have in the past been known to restrict and separate themselves from clients. But compared to the state of things today, they now make use of social media and online networking. Luxury brands now see web-based life as “mass advertise”, yet today it has turned into an undeniably imperative advertising tool for them.

Burberry is an amazing example of a luxury brand that utilized the power and impact of internet-based life. The brand commits around 60 percent of its advertising spending plan to computerized stages, connecting with clients on Facebook, Twitter, Tumblr, Pinterest, Instagram, and YouTube. Recently Louis Vuitton also started tagging their Instagram posts with the models private Instagram profiles, making the relationship between the customer, the brand and the model even more intimate.

After a great weekend I feel very confident about the future for both the luxury, premium and the regular fashion brands. I am sure that with the right approach the physical stores has great advantages and will also be vital for transitioning from on-prem via omnichannel to phygital.

If you are interested in hearing more about the future of fashion retail and IoT, feel free to contact me at bjorn.nostdahl@gunnebo.com 🙂

Category: Fashion

Luxury Brands starts their Blockchain Journey