There are three types of people in this world: those who love blockchain, those who hate it, and those who still have no idea what it is (but they might jump on the bandwagon anyway just to look cool).
In brief, blockchain is the technology behind bitcoin, the little cryptocurrency that could. The digital coin climbed more than 1,300 percent in value over the course of 2017 from about $1,000 at the start of the year to over $14,000 as New Year’s Eve wound down.
A block is a unit of data — traditionally, transaction data — that gets added to a chain of other blocks. Every computer participating in the chain has a copy of it, so everyone knows the moment a new transaction becomes canon. There is no undoing it, no spending those invisible assets a second time.
Each link in the continuously growing list of records points back to the blocks before it and contains specific transaction data and a timestamp. All of this is secured using cryptography.
Because every single movement is recorded in the distributed ledger, blockchain has actually led law enforcement straight to criminals — all they had to do was follow the binary paper trail.
So why is this important to retail? In part, because the people who love blockchain want to be able to spend their cryptocurrency in the real world — but also because those blocks don’t have to be made up of transaction data. Here’s how forward-thinking retailers are already applying this technology to the industry today.
Hooters investor Chanticleer Holdings just announced plans to launch a blockchain-driven loyalty program. Customers who dine at one of Chanticleer’s nine Hooters restaurants will receive crypto-cashback in Mobivity Merit tokens produced in conjunction with Mobivity Holdings. Coins can be mined, saved, redeemed for future meals at any of Chanticleer’s brands, or traded with other customers.
Those Chanticleer points could have been called anything. OwlCoin. BurgerBucks. WingCash. But by using and name-dropping blockchain, the franchisee shrewdly managed to boost its shares by 41 percent on Wednesday (Jan. 3).
Supply Chain Management
Blocks can also contain data about products and where they’ve been. This makes blockchain ideal for supply chain management and transparency. From production to transport to warehouse to wholesale to distributor and finally through the merchant to the consumer, a retailer can track a product’s journey every step of the way — and so can discerning consumers.
Grocers are one example of merchants who can benefit from blockchain. Food safety concerns are among the most significant risks in the business, not only because they make around 48 million Americans sick each year, but because of the financial and reputational toll they can take on a brand.
Progressive Grocer notes that food retailers could improve delivered freshness through proactive management rather than just assuming something is fresh based on its shipping date. It turns out that a product’s history and handling have a greater impact on its freshness than the harvest date.
By tracking the product’s journey with blockchain, a grocer could know upfront that the pallet of strawberries it received was not immediately cooled, so is likely to spoil faster — either on the shelves or shortly after consumers buy it. This increases waste and costs. Today, the U.S. throws away around 40 percent of the food it produces. How far could blockchain help reduce that percentage?
Apparel is another space where blockchain could have great benefits. Fake designer goods are a big business, but when every legitimate product is catalogued in the blockchain at every point in its journey, passing off a counterfeit becomes much more difficult, if not impossible.
Furthermore, blockchain can help brands provide better information to discerning consumers who place a high premium on brand trust. Millennials and Gen Z want to know where their clothing originated, what it’s made of, how sustainable the production process was, and other socially responsible pieces of data as much as, if not more than, they want to know product safety and care information.
Literally Just Branding
They used to be the guys who made the spiked iced tea and lemonade, but sure, why not jump on the blockchain bandwagon? Long Island Iced Tea recently changed its name to Long Blockchain and watched stock prices surge 300 percent as a result — floating its market value from $23.8 million to $92 million.
Apparently the company does have plans to grow the blockchain side of its business and focus on that while also maintaining its more widely-known beverage business. So if you’re thirsty, it’s still a Long Island Iced Tea that you want. Or, heck, ask the bartender for a Long Blockchain and see what happens.