Crypto crashes, but the technology behind it can save billions of luxury brands
These losses can hurt both profits and reputation – that’s why some brands are now turning to technology to protect their products, brand value and consumers.
“Blockchain is a technology that moves so fast, and it’s very complex,” said Daniela Ott, general secretary of the Aura Blockchain Consortium. “What Aura is all about is making blockchain easy for luxury brands.”
To date, more than 20 brands use Aura’s software, with over 17 million products registered on the platform, says Ott.
“These brands are competitors in all other respects, but they are collaborating on this technology to bring this about faster, in the safest way,” she says.
“Traceability and trust”
By creating a “digital twin” for physical products such as shoes or handbags, Aura’s software collects a ledger with information such as material type and source, where and when it was made, and how many were produced.
Ott says this will give consumers a higher level of proof and protection by acting as a digital authentication certificate that uses “bank-level encryption” and is “impossible to counterfeit” – preventing counterfeiters. Digital twins, which can be accessed via a website or mobile app, will provide more insight into the product’s origins, and improve “traceability and trust” around sustainability and ethical issues for conscious consumers, she says.
However, blockchain has its limitations – the information is only as reliable as the person who submits it, says Ott, and warns that “if a brand does not have a good relationship with the supplier, blockchain will not help.”
Aura launched its cloud-based software in early 2022. Ott says their plug-in technology will allow brands to integrate the product into their existing business with “zero blockchain knowledge”.
Modern technology
“Counterfeiting has been around for decades and is on the rise,” Chammard said. Vestiaire’s team of 60 authentication agencies checks digital documentation, including photos, before examining each item. AI and blockchain can help speed up the digital authentication process, says Chammard, adding that this will help the human authentication bodies instead of replacing them.
“We will continue to require an expert to conduct a physical survey to verify all the digital data,” she says, adding that if luxury brands use the same technology, it will help retailers with easy access to and use of the information.
Blockchain can also be useful beyond fashion, says Ott: luxury sectors including art, cosmetics, perfume and furniture can benefit. In the future, Ott says that the general ledger may also contain information on product maintenance and upkeep, which helps to better determine a product’s value for resale.
“Our goal of success is to board all luxury brands,” says Ott.
