It has been decades now since eCommerce is here, and the evolution of the industry has been exemplary. Mostly because of technological advancements as nowadays, the concept of online selling has been deeply influenced by technological improvements. And, the latest edition of all technologies in selling is blockchain, which spells new opportunities for the industry with its unmatched potential.
Yes, after impacting Digital Marketing with Blockchain
, it's time for eCommerce Blockchain. From streamlining operations to the elimination of agents and reducing complexities at all levels, eCommerce Blockchain has a lot to offer to help businesses resolve their long-term as well as everyday challenges.
Currently, there are three main uses like Payments, decentralized marketplaces, and supply chains, but the future is enormous, and many more applications are in the works. Then the question arises that how the Blockchain technology is evolving the eCommerce domain.
So, here we are to explain how blockchain is on its way to transforming the eCommerce marketplace. But before that, let’s have a brief knowledge about what is Blockchain. Let’s begin.
What is Blockchain?
In simplest words, a data structure that holds transactional records even while ensuring transparency, security, and decentralization is what we call Blockchain. It is a chain of blocks that contain information or data.
The first successful and popular application of the Blockchain technology came in the year 2009. And, with the use of Blockchain technology, he created the first digital cryptocurrency called Bitcoin.
Moreover, it can also be considered as a chain of records stored in the form of blocks which are further controlled by no single authority. A distributed ledger, blockchain, is completely open to any and everyone on the network. It is extremely difficult to change or alter a piece of information which is once stored on a blockchain.
When it comes to its authenticity, each transaction here on a blockchain is secured with a digital signature. Plus, the data stored on the blockchain is tamper-proof and cannot be changed due to the use of encryption and digital signatures.
Besides, Blockchain technology enables all network participants to reach an agreement, generally known as consensus. All the data stored on a blockchain has a common history that is available for all the network participants as it is recorded digitally. This way, without the need of a third-party, the chances of any fraudulent activity or transaction duplication are eliminated.
What is eCommerce Blockchain?
If we talk about the eCommerce store, it has a large volume of customer transaction data and inventory. For effective results, these data require proper management and storage. So, by combining transactions in the form of block and connecting every block in the form of a chain, Blockchain technology addresses this situation.
As every block is saved on a separate computer, thus making it secure, reliable, and scalable. And, for quality results, you can run an eCommerce on Magento store
and then try to integrate it with Blockchain technology.
eCommerce Blockchain: 7 Ways Both Make a Winning Duo
1. A More Transparent eCommerce Marketplace
This is one of the more serious concerns faced by existing eCommerce platforms. Yes, as a recent backlash, many big retailers are facing in the wake of charges of lack of transparency. For example, a big eCommerce company Amazon was in the news for disabling a merchant’s page like cutting off even without any explanation.
So here, the application of blockchain technology will help in the eCommerce marketplace as it would establish a decentralized environment where any wrongdoings on the part of the merchant or business can be monitored efficiently.
Besides that, a transparent eCommerce marketplace additionally facilitates conducting transactions inefficient as well as in a frictionless manner.
Moreover, retail giants like Walmart and Unilever made a declaration about recent blockchain projects — it indicates that they are now eyeing at winning a foothold in blockchain-based offerings.
2. Shipment Tracking
If we talk about supply chain management, Blockchain is already heavily introduced in it. And, as eCommerce depends largely on good supply chain networks, it can also get benefitted by it. So, by introducing blockchain technology within the supply chain, online buyers will be helped a lot as they will be able to track their order status whenever needed.
Furthermore, as with blockchain, users can follow the goods from the manufacturer to the retailer; it will bring transparency to the marketplace. At the same time, as retailers will be able to keep track of their stock, they will be able to make better sales forecasts, and it will surely ease their lives.
If you are looking for a live example of introducing blockchain technology to shipment tracking, then it is Alibaba’s Tmall eCommerce platform because Tmall users will be able to track their orders in Luxury Pavilion with the help of Alibaba Cloud’s blockchain technology.
So, to trace the product’s origin, its time of declaration for entry, its blockchain code, and more useful information; all they will need to do is to scan the QR code on the package. And, this is feasible because every product on the blockchain has a blockchain “ID card” via which the customer can verify later.
If you are looking for one of the most secure platforms out there, Blockchain is that one name.
The DLT or Distributed Ledger Technology, which blockchain boasts, provides excellent security for online database platforms, and this security feature is what makes it ideal for implementation in eCommerce. Plus, there has been almost negligible reporting of security breaches in blockchain-powered networks.
Besides that, one significant advantage blockchain offers for eCommerce businesses is that blockchain-based currencies don’t exhibit personally identifiable info.
Bitcoin type currencies operate like cash in the sense that they don’t require a consumer to expose sensitive data. Moreover, the customer or client authorizes a transfer from his/her own personal “wallet” to that of the recipient. So, a randomly-generated unique identifier is the only distinguishing piece of data tied to each user’s wallet.
There is an inevitable risk of losing customers’ data, as cyber-attacks and data theft have increased tenfold. Hence, to solve these challenges, adopting blockchain is an absolute key.
4. Help You to Get Positive Product Reviews
It is an undeniable fact that customer reviews drive sales on eCommerce platforms. The more positive reviews customers leave, the more the sale increases. Because this is the era now that everyone goes for reviews first and then only makes a purchase. Besides that, it reviews what determines the ranking position and where the retailer will appear on the eCommerce platform.
Consequently, many companies out there started to pay people to write positive reviews regarding their products. Well, this is almost all know now, so it surely discourages people from buying products online as it is diminishing their trust.
And, then blockchain technology enters as a rescue because Blockchain technology doesn’t allow new data (reviews) to be added before it has been verified by the blockchain network.
And also, it can’t be modified or tampered after a review has been approved. So, this is a fact that implementing blockchain solutions will raise the credibility of the eCommerce platforms in terms of customer reviews, as it will then lead to increased customer trust and loyalty.
5. Inventory Control
Keeping a constant track of inventory is another difficulty that eCommerce is facing. Usually, retailers do not update their stock records on time, and hence they experience shortcomings. Such things could further work as a prerequisite for illegal actions like money laundering, forgery, and corruption. Fortunately, blockchain technology can easily solve that problem as it applies to different management systems.
Well, you might be wondering how blockchain technology can accomplish that? Like we know already that the data in the blockchain is decentralized. And since all other entities in the network need to verify the new entry, this means that a single person cannot make modifications. Besides that, the data in the blockchain is encrypted; therefore, it is very difficult to manipulate in a malevolent manner.
6. Improved Supply Chain Management
One of the most pressing concerns every eCommerce business is marred with is perhaps Supply chain management. Blockchain implementation in this sector will likely solve many problems since the supply chain is a critical element of any eCommerce business.
Yes, to solve supply chain issues like recordkeeping, tracking of products as a less corruptible and better alternative to the centralized database, Blockchain can be extensively leveraged.
Some other use-cases of a supply chain include:
a. Provenance Tracking
Record keeping and provenance tracking become easy in a blockchain-based supply chain because the product information can be accessed with the help of embedded sensors AND RFID tags. Plus, via blockchain, one can easily trace the timeline of a product right from its inception to where it is at present. Moreover, we can also detect anomalies in any segment of the supply chain by leveraging the type of accurate provenance tracking.
b. Cost Reduction
There is a way to reduce the extra cost if you are using blockchain. Yes, the extra costs incurred by the system are automatically reduced when blockchain is applied to amp-up the administrative processes in the supply chain, and the process also guarantees the security of transactions.
Plus, while saving money at the same time, the elimination of intermediaries also eradicates the risks of frauds, product duplicity. Rather than suppliers and customers or relying on EDI, customers can further process payments within the supply chain by utilizing cryptocurrencies.
7. Payments Methods will Get Revamped
As we know already that Blockchain witnessed its first implementation in currencies powered by its technology (like bitcoin, ripple, and ethereum). And, this is the time when cryptocurrencies are being utilized as an alternative to traditional currencies.
All this shift is due to the relative ease of implementation and the fact that they are decentralized. Over traditional currencies, Bitcoin and other cryptocurrencies offer various benefits which are fruitful for both customers and merchants.
Here is the list of some significant advantages if offers:
The buyer and seller only control blockchain operations, which means Blockchain isn’t regulated by any central authority. Hence, no third party can look over or manipulate your transactions.
Moreover, unlike other currencies, Blockchain currencies can’t be inflated or devalued by any bank or government. For example, if the economy of any country is about to collapse, then their currencies would also suffer terribly. But this is not the case with bitcoin as geopolitics do not influence its operation.
b. Identity Protection
The cryptocurrencies which are based on blockchain technology do not reveal the identities of transacting parties. Despite that, these transactions are much more transparent because the centralized ledger stores the details and also gives visibility to transactions.
c. Freedom of Transactions
As we already mentioned above, there is no governing body that monitors or controls how a person utilizes his/her bitcoin. However, regular payment methods are also imposed with several limits based on the geographical location and the amount.
But again, with currencies like bitcoin, this isn’t the case because Blockchain-based currencies give users absolute freedom to perform transactions even without any cap on the spending limit.
d. Ease of Use
You may be thinking that the usage of these currencies might not be easy as they are different from your traditional currency. But that’s not true because Blockchain-based currencies are incredibly comfortable to use.
Even one doesn’t need to visit any regulatory authority to create an account, unlike traditional currencies. Yes, all these steps can be easily accomplished in the comfort of your home. Plus, as an added benefit, they also do not ask for any charges to open an account; rather than that, a virtual currency wallet is free.
e. Faster Transactions
While using traditional money, sending money across continents may take up to several days to accomplish as traditional transfers often take long. On the other hand, Bitcoin only takes up a few minutes. Yes, with such currencies, a transaction can be easily carried out at almost any point in time, that too in an instant.
f. Reduced Fraud
The very important feature of Blockchain-based currencies offers that they are extremely secure to transact. It is tough to hack into the process and conduct fraud because of peer-to-peer technology. Hence, you can say this is one of the safest modes of transaction.
Because of the recent developments, there are very high chances that eCommerce marketplaces would soon allow consumers to pay with Bitcoin instead of PayPal or Stripe. Yes, and due to that, sending and receiving money will become as convenient as scanning a QR code in addition to being secure, decentralized, and relatively easy to implement.
Most likely, the first implementation of blockchain in the eCommerce marketplace is the relative ease of making payments.
So, we have seen the extensive benefits of eCommerce Blockchain and also seen how it becomes imperative for businesses to embrace it for achieving expansive growth. No wonder that if you want to manage your consumer data reliably and are an e-tailer who wants to add transparency in all business transactions, this technology serves the best solution for you. Besides that, Blockchain opens you up to the smarter crypto-contracts and can also reduce your dependence on paper-based legacy systems too.
However, if you are looking to explore this futuristic technology to take your eCommerce business to the next level, having the right technology partner is a must. We at Covetus build advanced eCommerce solutions that leverage the power of Blockchain and also open unlimited opportunities for your business. So, to take your eCommerce business to the next level, connect with us, and unleash the potential of this innovative technology.