Blockchain allows you to track the provenance of products, consumer product and retail organizations can build confidence in their brands by giving consumers sight of the provenance of a product they’re about to buy.
Consumers have a considerable appetite for brands with sustainable credentials. In fact, it’s a multi-billion-dollar appetite. A study by Nielsen put the US market for sustainable fast-moving consumer goods at $100 billion in 2018.[1] The global market for sustainable goods is estimated to be worth a trillion dollars.[2]
Communicating your credentials will be critical to winning in this burgeoning market. A Unilever study of 20,000 consumers found that one in five would actively choose brands if they made their sustainability credentials clearer on their packaging and marketing.[3] So how can you make your credentials clearer and increase trust? Is there a better and more reliable way than just listing all your sustainable practices on product packages? Well, yes, there is. And it involves blockchain.
Blockchain can tackle a number of supply chain issues – and traceability is one of them. Take a traditional supply chain in the supermarket sphere. It’s not easy to trace a product from the retail store back to the farm where it was sourced. But blockchain can deliver this end-to-end traceability at the required level of granularity. For instance, in China, Walmart’s blockchain pilot enabled the company to trace a package of mangoes from the retail store to the farm in a few seconds.[4] Traditionally, this process would have taken a few days, if not weeks.
Turning traceability into a reputation for sustainability
So how can traceability help organizations demonstrate their sustainability credentials to consumers? Because blockchain allows you to track the provenance of products, consumer product and retail organizations can build confidence in their brands by giving consumers sight of the provenance of a product they’re about to buy.
The seafood industry provides an example. A London-based NGO has developed a blockchain-based system to track skipjack and yellowfin tuna. The fishing crew are provided with hand-held devices. They attach RFID tags to the fish they catch, scan the details, and upload the information the cloud. This data is then added to a blockchain ledger, creating an immutable record of each fish that’s caught. At every successive stage – from middlemen to factory processing to retailers – more details are added, delivering complete “catch-to-consumer” transparency. A consumer can then simply use their smart phone to scan the code on a package of fish and see exactly where the fish has been sourced from.
Figure: Blockchain enables end-to-end traceability
This level of transparency also offers significant value on the supply side in a seafood industry that suffers from forced labor issues. Providing a unique identifier to each fisherman means that each is visible and traceable, free from any potential abuse from middlemen. Routing all payments or wages through smart contracts could even ensure that the fishermen get paid what was agreed. In this way, blockchain brings traceability to multiple stakeholders and supports the growing market for ethical and environmentally conscious products.
Use cases across industries
There are a range of use cases drawing on blockchain’s ability to track provenance. Mining is another industry that can suffer from unsustainable practices. Take the issue of consumers wanting to know that diamonds have not been used to fund conflicts. In 2018, De Beers ran a successful proof of concept, which resulted in a working prototype for tracking diamonds from mines to retailers. It also announced an enterprise-scale blockchain initiative. With more companies – such as Alrosa and Lucara Diamond – adopting blockchain-based platforms, the number of companies relying on the technology for mine-to-market diamond tracking is on the rise.
Blockchain can help consumers track provenance, from a luxury handbag to the beans that form their daily coffee, satisfying the demand for brands with sustainable credentials. To find out more about blockchain’s use across the supply chain in Consumer Products, Retail and Manufacturing, access our full research report, “Does Blockchain hold the key to a new age in Supply Chain transparency and trust?”
[1] FoodBusinessNews, “Sustainable product market could hit $150 billion in U.S. by 2021,” October 2019.
[2] Brand Purpose: Fad or Future?, Europanel, 2016.
[3] Unilever, “Report shows a third of consumers prefer sustainable brands,” May 2017.
[4] Forbes, “3 Innovative Ways Blockchain Will Build Trust In The Food Industry,” April 2018.
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