For all the luxury brands in the world, the number one challenge they face is the duplicate and counterfeit items available in the market. Wherever you go, you will find markets where you can buy a fake Gucci or fake Louis Vuitton at a very cheap price. While this might be feasible for customers to buy the first copies, those who are misled into buying counterfeits on behalf of the brand suffer a huge price.
This also affects the sales and goodwill of the brand in the market. To combat this problem, brands like LVMH, Cartier, Y Prada come together to offer a blockchain solution for their customers looking for an additional seal of authenticity for the products they are purchasing.
The companies said in a joint statement that they plan to make a blockchain-enabled solution called, Aura Blockchain Consortium, available to all luxury brands to give buyers the assurance that what they are buying is authentic. This will also make the products transparently traceable.
The Aura Blockchain Consortium It enables consumers to access the product history and authenticity test of luxury goods, from sourcing to sales to second-hand markets.
The concept behind this blockchain solution is to address common problems in the luxury industry, improving the overall customer experience.
According to research firm Frontier Economics, there are billions of dollars in revenue at stake for luxury brands that are lost to counterfeits each year. The global trade in counterfeits will reach $ 991 billion by 2022, almost double the 2013 level.
LVMH CEO Toni Belloni called blockchain “a great opportunity for our industry to strengthen our connection with customers by offering them simple solutions to better understand our products.”
The statement issued by the companies also indicated that brands such as Bulgari, Cartier, Hublot, Louis Vuitton and Prada are already active on the platform and that discussions for other brands to join are underway.