When most people hear the word “blockchain,” they think of cryptocurrency. That’s probably because the greatest applications of blockchain technology in the last few years have mostly involved popular digital currencies like Bitcoin and Ethereum.
While blockchain and cryptocurrency might have a strong association in people’s minds, there is far more value in the technology than many might think. This is especially true in business. Each year, awareness of what blockchain technology can accomplish grows while more and more companies turn to blockchain solutions.
In this post, we share how businesses can leverage blockchain to build their brand’s digital identities, the benefits of incorporating blockchain in their brands, and look at examples of how major brands have already unlocked the potential of blockchain in their operations.
How Blockchain Works
To the uninitiated, blockchain’s inner workings might seem unfathomable. However, a clue to understanding blockchain lies in its own name. In simplest terms, a blockchain is a ledger where every transaction is cryptographically recorded as a single “block.” These blocks contain pertinent information about a transaction, such as a cryptographic hash of the previous block, a timestamp, and transaction data. As goods and services are transferred between owners, the blocks containing their transaction information are linked together in a “chain.”
You might wonder: what’s so special about recording transaction information? After all, isn’t that what ledgers are for? Well, the most important thing about blockchain is it’s a digital, shared ledger that is secure from the pitfalls of traditional record-keeping systems. The blockchain ledger is immutable, transparent, and contains no erroneous duplication or omission. In short, you might say that for businesses, blockchain is the record-keeping, efficiency-boosting, customer-rewarding tool of the future!
Immediate Future of Blockchain Solutions
Here are some important developments to take note of in the field of blockchain solutions:
- Global spending on blockchain solutions is projected to reach $19 billion by 2024.
- Banking and finance are sectors with the highest adoption rate for blockchain solutions, but industries like agriculture, healthcare, and others are swiftly catching up.
- Seventy-six percent of respondents in a Deloitte survey said they believe blockchain technology could serve as an alternative to traditional currency in the coming years.
- Mobile payment solutions, including blockchain, are gaining popularity with consumers in every sector, especially millennials and gen-Z.
Regardless of your personal views on the technology, it’s clearly here to stay and grow.
Building a Digital Product Identity With Blockchain
With the advent of Web 3, digital advertising is now more democratic than ever. Tools like Google Adwords, Facebook Advertising, and other trading desks empower companies to personalize their messaging for every customer.
However, unlike complex and costly advertising models, blockchain represents an opportunity for brands to reach consumers before, during, and after their shopping.
How It Works
A blockchain application provides the ideal platform to connect brands, retailers, consumers, and other stakeholders via a shared product database. The database is comprised of data from trusted sources like industry authorities, retailers, brands, and verified reviews. Using blockchain, it’s possible to create a digital product identity for any product on the market.
It’s a flexible, “self-service” marketing solution that’s a win-win for businesses and consumers. With lower budgets and higher engagement, blockchain is going to be inextricably linked to digital product identity in the future.
How Blockchain Features Benefit Businesses
The value of blockchain technology is being realized in every sector. From healthcare and retail to finance and shipping, companies are embracing the advantages of utilizing blockchain technology. The reason that blockchain works so well for businesses is that it is designed to build trust even between strangers. As a shared, permanent, secure record of transactions, blockchain is more reliable than other record-keeping systems.
Let’s look at some of blockchain’s features and how they can help businesses.
Features: Decentralized Network and Cryptographic Encryption
Blockchain runs on a decentralized network. There is no single governing body that oversees the information on the blockchain. Additionally, all the data is stored using end-to-end encryption.
Benefit: Security
Storing the blockchain’s data across a network of computers means there is no single server for hackers to break into, preventing cyberattacks. The unalterable, encrypted record of transactions means there is no room for fraud or unauthorized transactions.
Feature: Distributed Ledger
A key feature of blockchain is its distributed ledger technology. It works by recording all transactions and data identically in multiple locations. The distributed ledger is a single source of truth for all transactions taking place on the blockchain.
Benefit: Transparency
Because all participants in a blockchain have access to the same information at the same time, it allows for complete transparency. When multiple databases are maintained, it creates room for error. However, on a blockchain, all parties refer to a single database, enabling accuracy.
Feature: Immutable Records
Users can’t undo transactions on a blockchain. Every new block on the chain checks the validity of the information against previous blocks. This allows the entire history of a transaction to be reliably recorded.
Benefit: Traceability
Since the blockchain serves as an end-to-end record of all transactions, it allows any asset to be tracked during any stage of its life cycle.
Feature: Faster Transactions
Blockchain brings together participants in a network and allows them to conduct transactions without the need for a middleman. Documentation and transaction details are stored on the blockchain, creating a streamlined flow of information.
Benefit: Efficiency
By eliminating the need for third parties and reducing the potential for human error, blockchain makes transactions more efficient than ever. Large payments made on the blockchain using cryptocurrency can be processed faster than traditional banking systems.
Blockchain technology is already changing the way companies work. From making payments easier to keeping records straight, there are myriad ways in which businesses can implement blockchain technology to their benefit.
Participants on a Blockchain Business Network
When businesses build their own blockchain applications, they have to create a framework to manage their user base. The average business blockchain has multiple participants, all of whom play different roles in ensuring the blockchain functions efficiently. These participants are:
- Users: Participants with permission to join the blockchain and conduct transactions
- Regulators: Users who oversee transactions within the network and have special permissions
- Developers: Programmers who create the applications and smart contracts that enable transactions on the blockchain network
- Network Operators: Special users with permission to manage and monitor the entire blockchain network
Apart from these active participants, business blockchains also function by integrating data from:
- Traditional Processing Platforms: Existing computer systems to initiate requests in the blockchain
- Traditional Data Sources: Data banks that influence the behavior of smart contracts and define communications between the blockchain and traditional applications
- Certificate Authority: The authority issuing the required certificates to run a private, permissioned blockchain
These participants and data sources ensure a well-functioning blockchain.
5 Case Studies of Brands in Different Industries Using Blockchain
Based on the current rate of adoption, blockchain for businesses could see a huge boom in the coming years. Already, companies have begun harnessing the power of blockchain technology to build their brand identities in many different sectors. Some notable projects by brands using blockchain are:
The Open Music Initiative (Media)
For media companies, blockchain represents a solution to problems like piracy, intellectual property rights, and royalty payments. In Boston, the Open Music Initiative is a non-profit using blockchain to identify original creators and music rights holders.
Since blockchain’s design prevents digital assets from existing in multiple places, it prevents duplication — in this case, music piracy. By maintaining data integrity through blockchain, the Open Music Initiative allows musicians to be fairly compensated for their work.
Propy (Real Estate)
Blockchain has the potential to seriously disrupt how transactions are carried out in the real estate industry. Smart contracts recorded on a blockchain save time and money for all parties. For example, the California-based company Propy operates a global real estate marketplace based on Web 3 technology. By recording transactions on the blockchain, they are immutable and protected from title fraud. Propy also allows homes to be bought and sold using cryptocurrency.
WholeCare (Healthcare)
Healthcare is already an expensive sector, but blockchain could help bring down costs. Blockchain platforms like WholeCare is improving access to information for patients and doctors while streamlining communication between them.
WholeCare provides HIPAA-compliant record keeping on the blockchain, providing a secure and reliable repository for sensitive medical information. It’s a new approach to patient care that brings together personalized care plans, medication protocols, and appointment creation through the blockchain.
Shping (Retail)
The retail sector is set to witness revolutionary changes as blockchain adoption increases. In the age of mobile shopping, Shping has elevated the shopping experience by creating a direct line of communication between clients and brands.
Compiling product information from brands, retailers, and consumers into a shared and distributed Global Product Database, Shping allows users to make smarter choices. The app’s decentralized reward system also grants users Shping Coins which drives higher engagement.
IBM Food Trust is a blockchain-based platform that provides transparency and traceability across the food supply chain.
It enables food businesses to track and share information about the origin, processing, and distribution of food products to improve food safety and reduce waste.
Blockchains and the Future of Digital Brand Identity
As blockchains for businesses become more prevalent, further disruptions can be expected. Blockchain adoption is going to change the way consumers interact with goods and services. This requires a platform that can bring brands, retailers, consumers, and other stakeholders together in its value chain.
Shping is one such platform where all pertinent information from these groups can be consolidated and shared. Brands can use a shopping platform like Shping to better connect with their consumers by creating loyalty programs, sharing product and pricing information, and hosting user reviews — all done with the power of blockchain.
In a competitive marketplace, brands need to find more efficient ways of interacting with their consumers. The Shping platform is designed to enable trust and transparency between the two. The disruptive power of blockchain and its ability to build a brand’s digital identity paints a promising picture for the future of brand-consumer relations.
