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Blockchain, Smart-contract, Bitcoin: these buzz-words are all around fin-tech places but very few of us actually apprehend what exactly lies behind the glitter. Unlike the Internet of Things (IoT), Artificial Intelligence (AI), Blockchain is not one of these shiny innovations with fancy acronyms whose repercussions are obviously tangible.

Ford removed horses to develop speed, revolutionizing both transportation and our way of life. Blockchain, by fading intermediaries, could definitely change business processes thus launching the 4th industrial age. If you are wondering how and under which conditions, Retail use-cases can help measure the deep power of Blockchain.

A technological architecture

As we all know, the arrival of the Internet allowed a new way to exchange information. Blockchain can be described as its step-sister, impacting value exchange. It could be compared to a technological architecture, laying the foundations of a revolutionary system of value exchange. Without going into detail about its complex operations, there are 3 main features to retain about the Blockchain:

Transparency: It works as a distributed ledger: each anonymous participant owns an original copy of the latest version of the chain, as well as the history of changes.

Decentralization: A consensus process is generated within the blockchain: participants with enough computing power are rewarded to verify, validate and record the transactions. There is no middle man implied.

Security & irreversibility: The ledger is based on asymmetric cryptography. It authenticates transactions, secures exchanges. The transactions once recorded can’t be deleted or modified.

Impacting business processes

Paradoxically, the Blockchain was originally designed to support Bitcoin application and proposed a pear-to-pear network. Things changed in 2012 with Ethereum appearance, mixing pear-to-pear to business expectations with Smart Contracts. It allows actions/consequences to be automatized like « if A happens then B applies. ». What if business processes could be operated without a middleman, saving time and fees, whilst still being  secure and transparent? What if traceability transforms from burden to asset?

Of course, Blockchain isn’t a magic wand, but it is a very interesting tool for our more and more stratified and complex processes. Nowadays, where consumers expect high quality services, rapidity and proximity, where we are surrounded with huge amount of data to use carefully, the blockchain represents an innovative foundation allowing for smooth interactions.

Inbound and Outbound logistics

Blockchain represents a seamless tool strengthening commitment and loyalty in the logistics process.

If you wonder how to better engage with your suppliers and logistics partners, then you may be interested in the Carrefour initiative.

Carrefour, by developing a blockchain traceability solution, managed to enhance its Act for Food Chart. Carrefour’s first attempt with Auvergne chicken is a success: a QR code on the label allows everyone, from suppliers to customers, to read information about product origin or production methods, feeding and care plans, producer’s name etc.

Furthermore, by relaying their partner-producer promotional support and smoothing out traceability, they noticed a gain in trust and commitment.

Marketing & Sales : customer experience

Blockchain could enhance the customer experience.

Giving the 2018 Super Office Survey, 86% of customers are willing to pay a higher price for a better customer experience. Indeed, some brands build all of their price positioning on those grounds. There are of course payment innovations entail by Blockchain and developed by hyperledger, Swift and many others : this could mean the end of delays  and extra, exaggerated fees occurring from overseas payments.

Outside the payment case of interest, Blockpoint develops an interesting initiative: it helps simplifying payment systems and allow for mobile wallets, loyalty programs, gift cards and other point-of-sale functionalities. Cashiers will no longer have to try and remember to ask each customer “ do you have a loyalty card?” over and over again.

Marketing & Sales : counterfeit

A second and interesting blockchain application is against counterfeit:

In Europe only, counterfeit represents 60 billion euros of loss for 13 sectors, according to a European Union Intellectual Property Office survey. The main concern for the logistics chain is indeed transparency, in order to prove authenticity through effective and secure tacking.

Blockchain, which certifies any and all transactions and records them permanently, would be an answer to this lack of transparency. Vechain, partnering with Danone, LVMH and many others, brings together the IoT and blockchain protocols to deliver a high level of traceability of many kinds of products (luxury, dietary etc.).

Services

Particularly in the food industry, product recall is costly and not conducive to good publicity. Concerning the different food scandals, the opacity of the logistics chain exacerbates recall complexity as well as sanitary consequences.

Vechain and Warranter, both propose blockchain solutions allowing consumers to easily access information regarding the products they purchased and get service in the case of product malfunction.

Blockchain would of course not miraculously eradicate malfunction or the unpredictability of mother nature but it can help to contain consequences and improve customer experience.

Blockchain is still at a very early stage of maturity. Expectations and development are considerable but concrete examples of operating projects quite marginal and often seeking economic viability.

However, according to Critical Future’s recent market report, the global Blockchain market size is expected to grow at a compound annual growth rate of 62,61%, reaching $120 billion economic impact by 2024. Of the 1800 business professionals surveyed 79% believe Blockchain technology is broadly scalable and will eventually achieve mainstream adoption. The technology became a preoccupation of the authorities as well: in USA, France, European Union, Japan and China we see more incentive regulation emerging.

At this stage, when Blockchain project values can still be difficult to measure, BlockchainDataStudio, developed by BaybridgeDigital, intend to advise firms about blockchain implementation according to their project and application.

Written by: Albert Dupouy