Blockchain will change retail in five ways
At its core, blockchain technology is a shared digital ledger — a growing chain of transaction records spread across a network of computers rather than stored on one central server. Once a block of data is added, no single party can quietly edit or delete it, which is exactly what makes it useful for tracking who did what, and when, across a long chain of hands.
So what is blockchain actually good for? Far more than the headlines about crypto trading suggest. Cryptocurrency was simply the first widely visible use case, and it’s easy to assume blockchain is just some shady crypto-only tool, but that’s a narrow read. From verifying where a diamond was mined to confirming a shipment stayed cold during transit, blockchain in retail is quietly becoming one of the more practical, unglamorous applications of the technology. Here’s how it’s shaping the retail sector.
1. Accuracy
With this technology, it is now possible to see precise information about the product you buy. For instance, if you purchased a lemon pie, the blockchain data would tell you where and when this pie was baked, and you can even find out the name of the baker who baked it, or the chief baker/supervisor’s name who assured the quality control and approved the product. Moreover, you can even track all the pie’s ingredients, like flour, eggs, lemon, etc. This means you can know for sure what components the confectionery/bakery company has used (e.g., if the bakery purchases their lemons from Fresh Fruits company, you’ll easily find this information).
Retailers in fashion and food are increasingly formalizing this into what’s called a digital product passport — a blockchain record attached to an item that follows it from raw material to shelf. Blockchain takes the merchant-customer relationship to a new level.
2. Authenticity
Customers are always concerned about the authenticity of the luxury brands they buy. Especially when they buy such things as made-to-measure couture from a fashion house’s licensed store, or when they purchase items at a surprisingly low price. With blockchain technology, purchasers are able to trace the data behind the products they buy, allowing them to confirm exactly what they’re purchasing — a genuine brand item, or a cheap knockoff. De Beers, for example, uses blockchain to track diamonds from the mine through cutting and polishing to the retail counter, giving buyers a verifiable record of origin and ruling out conflict stones along the way.
3. Logistics
Most customers are eager to track the parcels of the goods they’ve bought. Blockchain technology makes this considerably easier, giving customers detailed and accurate information about the journey of every product, down to where it’s located at a given moment.
This also applies to the monitoring of health and safety requirements. It can be easily implemented for use-by dates and storage condition control systems. The inspection body can track the origins of a particular product along with its conditions of transport and storage, which helps to detect and eliminate expired or contaminated goods. Seafood producer Kvarøy Arctic, for instance, uses IBM Food Trust to log hatchery, feed, and processing data for its farmed salmon, so any contamination issue can be traced back to the exact batch rather than triggering a blanket recall.
4. Payments and e-commerce
Blockchain has been used from the start for transaction tracking (related to cryptocurrencies) and ownership establishment. Using Bitcoin, for example, we can clearly see that it is possible to create a secure and trusted payment system.
Some people think blockchain will only ever matter for accepting crypto payments in e-commerce and retail. That’s only partially correct. This technology does ease the acceptance of cryptocurrencies, but it also facilitates the returns and refunds process through the creation of digital record mechanisms. Using the same ownership-tracking approach, it also helps trace the onward selling of stolen items, especially large purchases.
Plenty of major platforms already lean on this. Shopify, for one, added native USDC stablecoin checkout through a partnership with Coinbase and Stripe, letting merchants accept crypto payments directly at checkout without bolting on a separate payment gateway.
5. Proof of ownership
Now that we’ve moved on to proof of ownership, let’s talk about it. Blockchain is genuinely useful for crime and counterfeiting prevention, but that’s not all it offers. It’s also well suited to establishing proof of origin. People are able to see clearly who made and who owned a particular item, which increases its value and makes purchasers aware of exactly what they’re buying.
This technology may be applicable to different sectors and branches of human activity. It can be useful, for instance, in the dating of antiquities, understanding an item’s history, and monitoring the components and origins of previously owned products.
