Even though it’s a part of a worldwide market that’s worth $2 trillion, the fashion sector remains one of the most archaic. The fashion business has been notoriously sluggish to accept new methods and technologies up until recently, despite the rapid pace of technological advancement. We will investigate how digital fashion that is enabled by blockchain will lead to the development of new business models for businesses.
A blockchain is a distributed ledger that is not centralized and may record transactions in a transparent and safe manner. As a result of its decentralized nature, blockchain does not require the involvement of a third party in order to validate or validate transactions. Because of this, blockchain-based systems are able to outperform traditional systems both in terms of efficiency and cost effectiveness.
Traditionally, fashion has been about expressing one’s uniqueness and establishing new trends, but when it comes to technology, the industry has lagged far behind. In the future, digital fashion that is enabled by blockchain will alter since it will provide brands with a new method to communicate with their customers and offer novel products as well as experiences. The distributed ledger technology known as blockchain makes it possible to produce one-of-a-kind things that cannot be copied or forged in any way. This enables brands to develop items that are available in limited quantities, which in turn increases the value of their products.
For instance, a luxury firm may produce a line of handbags manufactured with diamonds that have been validated using blockchain technology. These bags would be registered on the blockchain, and their individual histories would be traced from the moment they were made until they were sold. It would give the company a mechanism to track and verify the genuineness of their products, as well as guarantee that the buyer receives an actual item when they make their purchase.
There are a few main ways in which digital fashion that is enabled by blockchain may build new business models for firms. To start, blockchain technology will make it possible for brands to establish direct connections with consumers. In the past, companies needed to rely on third parties to connect with their target consumers. Through the use of smart contracts, companies may establish direct connections with their target audiences by utilizing blockchain technology. It does away with the need for middlemen, allowing manufacturers to offer their wares at a more competitive price, and it saves time. Blockchain technology will make it possible to manage supply chains more quickly and effectively. Using systems based on blockchain, companies will be able to monitor the progress of their items from manufacture to delivery. They are able to spot inefficiencies in their supply and make the appropriate adjustments in accordance with those findings. In addition, brands will be able to reduce their carbon impact with the assistance of blockchain technology, which will monitor the origin of each product. The fashion business will soon become more open and trustworthy thanks to blockchain technology. Brands are able to confirm that the materials used in the production of their goods were obtained in a morally responsible manner if they record transaction details on the blockchain. Additionally, this helps to avoid fraudulent activities and counterfeiting. In addition, blockchain technology will make it possible for companies to monitor the real-time sales of their items. This kind of transparency will assist brands in making more informed judgments regarding how to divide up their available resources.
To begin, customers will have access to a wider variety of things at prices that are more favorable. Because of the direct link that will exist between companies and customers, brands will be able to sell their wares at prices that are cheaper than those offered by traditional retailers. Second, people will have access to products that are sourced in an ethical manner and are of a high quality. Customers will have more faith in the items they purchase as a result of blockchain’s ability to make the fashion sector more open and trustworthy. At long last, they will have the opportunity to purchase one-of-a-kind items that are specifically crafted to suit their preferences. Systems based on the blockchain will make it possible for firms to tailor items specifically to the tastes of individual customers.
The blockchain-enabled digital fashion sector will provide new business models for enterprises and a more efficient, transparent, and secure industry. When customers and brands have access to more high-quality products at lower rates, this will benefit everyone.
Reference:
Bertch, Richard. “How Blockchain-Enabled Digital Fashion Will Develop New Business Models for Brands.” Fibre2fashion.com, Fibre2Fashion, 28 June 2022, https://www.fibre2fashion.com/industry-article/9423/how-blockchain-enabled-digital-fashion-will-develop-new-business-models-for-brands
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