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Will You Be Ready for Blockchain?
The technology is maturing fast, and every brand and retailer will be impacted in some way. The technology is maturing fast, and every brand and retailer will be impacted in some way, so it’s time for trading partners to prepare accordingly.
4 Min Read
The technology is maturing fast, and every brand and retailer will be impacted in some way, so it’s time for trading partners to prepare accordingly.Photograph: Shutterstock
Consumer trust is the new competitive battleground. It’s an essential part of the shift from traditional transactions to a more modern type of ongoing brand-consumer relationship—one that always delivers hyper-relevance in the moment. And it is one of the many topics C-level executives from across consumer products and retail organizations will be exploring when they convene at the 2019 Consumer Goods Forum Global Summit in Vancouver, British Columbia.
But building consumer trust requires a new level of transparency from the brand, including product provenance, safety, ethical manufacturing and more.
Photograph courtesy of Accenture
It’s a phenomenon we can all recognize in our own shopping. We want to be certain we’re buying genuine branded products, not counterfeits, especially when we’re online. We increasingly expect our purchases to be sustainable and ethically produced, certainly when that’s a stated part of the brand purpose. And of course, we want to know the products we buy are safe to use and safe to eat, maintained in the right way and free from any tampering before they hit the store shelf.
Radical Transparency Needed
But for consumer goods companies, this level of individual product transparency has always been surprisingly hard to deliver. Just think about today’s complex cross-border supply chains. If documentation is paper-based and spread around the world, errors, omissions and duplications are inevitable. And even when data is digitized, if each party in the supply chain maintains its own siloed database then it’s effectively trapped and unusable by anyone else.
Attempts by companies to connect the dots across the supply chain for individual products have always proved highly inefficient and expensive, taking weeks or even months for some food items. The result: no brand or retailer has a quick or easy way to track exactly where a particular item has been, who handled it, how it was maintained and where it is now.
Blockchain promises to change this radically. For all the hype surrounding the technology, the consumer goods supply chain is a clear and compelling use case.
Unchaining the Supply Chain
By enabling each relevant organization to record and share information about a product in a completely secure way, blockchain lets the whole supply chain work together to create a “single version of the truth” available in almost real time to anyone with permission to view it.
That’s a game changer for product transparency. What was once protracted and painful becomes speedy and simple. At the push of a button, the brand, the retailer or the consumer can get a full audit of each item’s entire history and present whereabouts.
Next-Level Safety
Consider the impact on product safety, especially food. Consumers can see for themselves how a particular food purchase was grown or produced, whether the right conditions were maintained during transit, and when it will expire. Brands and retailers can use the same information to route products much more efficiently, even redirecting items nearing expiration to local food pantries. And when contamination does occur, companies can pinpoint affected items and remove them from sale with almost surgical precision.
The End Of Counterfeiting?
And what about fake goods? Counterfeiting is a major problem worldwide, estimated to be worth over a trillion dollars each year. But imagine if manufacturers could tag each product with a unique identifier (such as a radio-frequency identification, or RFID, chip). Then imagine that chip is scanned onto a blockchain at each step in the value chain.
The result is a digital record offering an unprecedented level of guarantee that the goods consumers are buying are precisely what it says on the label. And the global counterfeiting black market? It potentially becomes obsolete overnight.
Proving The Brand Purpose
There are new possibilities in brand ethics and product sustainability too. A real cultural shift is underway, and consumers are starting to believe they can make a genuine difference through their purchasing. They’re more and more likely to choose brands that they identify as reflecting their own values and beliefs. So being able to prove the ethical or sustainability credentials of a particular product is going to become ever more essential.
Examples like these give just a taste of blockchain’s possibilities. The technology is maturing fast and has already been proven to work at scale. What’s more, the consumer goods value chain is an ideal use case, so it will happen. And whether they plan to develop their own solution or not, every brand and retailer will be impacted in some way. A revolution in consumer trust and relevance is coming. The time to start planning is now.
Laura Gurski is senior managing director, global lead, for Accenture’s Consumer Goods & Services practice.
