The Internet of Shopping: Blockchain Solutions to Consumer-Retail Challenges
It’s possible that blockchain, as a disruptive tool for innovation, will successfully shake-up and improve upon the existing hegemony seen in consumer retail. We have already seen this happen in many other areas, like traditional finance.
Projects such as Ethereum stand testament to the fact that blockchain has far surpassed its original use-case (as a decentralized payment solution).
Furthermore, developments around the nascent technology are proceeding at remarkable speeds for the consumer market – at varying levels of accomplishment.
We would like to take this opportunity to further explore some of the more prominent examples, what their goals are, and how their teams seek to achieve them to give you an enhanced perspective on what we can expect in the future.
BC / AD: Before Cryptocurrency / Anno Decentralization (A Prologue)
Consumerism and retail shopping have long been a cornerstone of modern civilization: with tangible benefits that apply to society, politics and the economy.
One of the greatest epitomes of this growth was reached in tandem with the growth of early commercial internet technology, through to Web 2.0.
Many new market leaders rose from the ashes of the burst dot-com bubble, as well as the Western economic recession of the early 2000s. All under the banner of ‘e-commerce’
Since then, we have arguably seen a stagnation in the traditional retail shopping sector. Brick-and-mortar stores are in constant decline in many areas of the Western world, as well as shopping malls closing down throughout the USA (dubbed by some the ‘Western Retail Apocalypse’).
Amazon currently possess 41% of US e-commerce retail sales, according to Statista. A number which is projected to increase to 50% by the year 2021.
1. Blockchain for the Unbanked and Borderless Payments
According to the data from The World Bank’s Financial Inclusion Database (or ‘Findex’) 1.7 billion adults were recorded to have been ‘unbanked’.
‘Unbanked’ denotes individuals who do not have access to traditional financial services, for the most part living in developing countries. The largest of these is China (225 Million), closely followed by India (190 Million).
Banking institutions have demarcated the differences of opportunity and accessibility between classes – both domestically and between the ‘first’ and ‘third’ worlds. They have also acted as gatekeepers to a broad range of valuable services and functions: such as international payment transactions, and currency conversions.
Being without a traditional centralized bank doesn’t have to mean you are ‘unbanked’ however, as blockchain and digital banking providers are proving. These populations alone provide a massive use case.
Shops, service providers, and many other possibilities have been left wide open, and we’ve already seen some examples of organizations attempting to resolve this issue….
Cryptocurrencies like Bitcoin for example are a cheap and fast means to send money and furthermore, allows for those ‘unbanked’ to access digital consumer markets with ease.
IBM is another organization responsible for a unique solution to the issues of the ‘unbanked’ seeking to send cross-border payments by using peer-to-peer (P2P) blockchain technology.
Travelers and migrants are a great example of the potential beneficiaries for this type of project. This is because making international payments in developing countries can often be error-prone, costly with transactions in different currencies – requiring multiple-intermediaries to process them over days or sometimes even weeks
2. Shopping Loyalty Programs, by way of Blockchain.
Loyalty rewards programs have existed for a long time as a means of attracting a greater level of sales and custom in a repeat manner, as well as for the gathering and interpretation of shopping data to provide insights and historical data analytics.
Their age is telling however, as the lack of development on this front regarding the benefits offered to both users and program providers has remained somewhat static for a long time now, with little in the way of improvement or progress.
It has become a burgeoning issue, that these types of programs are perceived as unfulfilling to many, with a high level of market penetration when considering the percentage of households enrolled – however a low number of overall utilization of the points or cards by said households.
There are a number of interesting platforms which claim to provide a solution to this issue, which include some which we have covered ourselves in great detail before (see our review of Eligma for example), as well as others we would like to discuss more in the near future.
One of the latest of these is Gabrotech, which positions itself as a 6-in-1 solution. Its user-centric and comes with a multi-currency crypto wallet that offers seamless P2P transfers, and loyalty redemption capabilities among others.
The platform has a multi-currency conversion engine (MCCE) that allows for borderless payments in any place that accepts MasterCard. It utilizes a liquidity pool that converts ‘any supported blockchain asset to the appropriate fiat currency at market value in real-time’.
This brings empowerment to the swathes of unbanked peoples, representing a breakthrough moment for a gigantic population of the world.
Source: Presentation by Pani Baruri, ‘Blockchain Powered Financial Inclusion’
Gabro’s core strength lies within its token Gabro (GBO). It’s a utility token solely designed to work within its ecosystem. Users are rewarded with GBO through spending, conversion or friend referrals.
Through its Loyalty Central feature, it removes the requirement for multiple accounts to manage multiple loyalty programs and allows for the simple swapping and consolidation of loyalty points. This will allow for idle and / or lower credited programs to be topped up and utilized to their fullest.
Blockchain technologies are already disrupting the financial industries; unbanked and cashless societies are tipped to benefit the most from the technology. Interestingly, the loyalty market, worth approximately $500 billion USD, is also to have its full potential realized.
3. Account Data, Personalized Customer Experiences, and Product Recommendations
Research within the retail sector has long existed as a practice. The dawn of big data and other new technologies such as automated data processing, however, have led us into a new era of insights (best known as customer analytics).
Shopin is a token-based platform which seeks to use blockchain technology in order to create user data profiles / accounts which are transferable and inter-operable between different participating merchants across the web.
In addition to providing absolute security and empowering users through control over their data and its security, merchants are incentivized by having access to powerful on-boarding tools and deferred liability regarding data protection.
The platform also incorporates machine learning / AI systems and data relationship protocols to provide product recommendations to its users on the customer / consumer side.
If you are interested in learning more about this solution in particular, check out our ICO review from April this year.
Featured image courtesy of Shutterstock.