For all the luxury brands in the world, the number one challenge that they face is duplicate and fake items available in the market. Anywhere you go you will find markets where you can buy a fake Gucci or a fake Louis Vuitton at a very cheap price. While this might be feasible for the customers to buy the first copies, but those who get dupes in buying fake in the name of brand suffer a huge price.
This also affects the brand’s sales and goodwill in the market. To combat this problem, brands like LVMH, Cartier, and Prada are coming together to offer a blockchain solution for their customers who seek an extra seal of authenticity for the goods they’re buying.
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 provide shoppers with assurance what they’re buying is authentic. This will also make the products traceable in a transparent way.
The Aura Blockchain Consortium makes it possible for consumers to access product history and proof of authenticity of luxury goods – from sourcing to sales, all the way to second-hand markets.
The concept behind this blockchain solution is to address common issues across the luxury industry, enhancing the overall customer experience.
According to research firm Frontier Economics, there are billions of dollars worth of revenue at stake for luxury brands that are lost to counterfeits every year. The global trade in counterfeits will hit US$991 billion by 2022, almost double the level of 2013.
LVMH Managing Director Toni Belloni called the blockchain ‘a great opportunity for our sector to strengthen our connection with customers by offering them simple solutions to get to know our products better.’
The statement issued by the companies also stated that brands like Bulgari, Cartier, Hublot, Louis Vuitton, and Prada are already active on the platform and that discussions for other brands to join are in process.