I’m sure you have heard the term “blockchain” thrown around over the last few years with the rise in popularity of Bitcoin. Perhaps you understand the idea, but you are not totally sure how it can be helpful in modern industries that you care about, such as fashion. Or, you may not understand exactly what it means as it is something that is hard to understand if you do not have much exposure to it. Conceivably, the term may be completely new to you. No matter your background on the topic, Dresscode is here to answer all of your questions about blockchain and how it can impact the fashion industry.
To start off, let’s clear something up, Bitcoin and blockchain are not the same thing. Bitcoin is a cryptocurrency, or a digital currency, and it is often mistaken as the same concept since Bitcoin uses the blockchain technology to record its transactions. Visit Bitcoin if you are interested to learn more on the subject.
Now that is cleared up, we can dive into the specifics of blockchain. Simply put, blockchain is a technology that records all transactions into a database. Once these transactions are recorded, they can never be deleted or tampered with in any way; one can only add new data to the database but can never remove or change any inputs. The database is then shared either privately, say within a business, or publicly. The beauty of blockchain is that it does not require any intermediaries; transactions are recorded and shared with everyone in the network, easily.
For instance, let’s say a shoe company incorporates blockchain into their operations. Every single step in the manufacturing process will be recorded into the blockchain; the specific raw materials that are used, when each product is completed, where the product is in the delivery process and more is recorded in the blockchain. Each item produced can be traced directly back to its source.
To learn more about the benefits that blockchain could bring to any industry, fashion in particular, we talked to Janine Just, the founder of Janine Just, a PR and marketing firm that focuses on out-of-the box and non-traditional PR as well as experiential and creative marketing; Janine is also a thought leader in the space of blockchain.
Janine explained to us how every industry can benefit from blockchain, the food industry, the medical field, and the fashion industry, to name a few. To focus on one, Janine believes blockchain can make a huge impact on the fashion industry by improving current supply chains, reducing waste, monitoring unethical labor practices, improving customer loyalty programs, and drastically reducing the issue of counterfeit goods.
- Supply Chain – When it comes to the supply chain, every transaction that is done during production and distribution can be monitored and tracked through blockchain. In doing so, actions that make the supply chain less efficient can be changed or eliminated. Additionally, keeping track of inventory is instantly easier as you will know exactly where the inventory is and how much is on-hand. Finally, tracking orders and product safety can be improved as well; if a package is damaged in any way along the delivery process, a company can know exactly where and when it happened. All of this will significantly cut down on time, reduce waste, and lower costs.
- Unethical Work – Unethical working conditions, such as child labor, workers’ rights violations, or poor working conditions, can be eliminated as the blockchain will document the entire process of where and how products are being manufactured. This will force any company to change their practices if they have not already or bring to light any issues that a company was not aware of before.
- Reward Points – In retail, reward or loyalty points is a great way to attract customers and encourage customer loyalty. However, tracking the reward/loyalty points is time-consuming and expensive. With blockchain, information can be tracked more easily and updated in real-time. Additionally, any other form of promotion, such as coupons, can be tracked more easily, allowing businesses to better track trends and consumer behavior.
- Counterfeit Goods – The sale of counterfeit goods is one of the largest issues in the luxury industry. Selling counterfeit luxury goods damages the reputation and takes away profits from a well-established brand. With blockchain, the production of every product can be traced back to the source. If a product cannot be traced back, then they will know it is a counterfeit item. This will allow retailers to verify whether a product is real or not and whether it is a new or used item.
By implementing blockchain into the fashion industry, it can help businesses save money and reduce waste, it can help those in poor working conditions, and it can verify the authenticity of products. “The fashion industry, like many industries, can be wasteful with their products; by implementing blockchain they will be more conscious about where products are coming from and how they are made” – Janine Just.
At Dresscode, our mission is to encourage curiosity by merging fashion and technology, and we are always looking to learn more about how technology can affect the fashion industry. Visit Dresscode to learn more and thank you to Janine Just for her insights.
Written by Emma Kuszynski – Dresscode Email and Blog Content Intern 6/13/2019