Unless you have been hibernating for the last few years, the chances are that you have probably heard of a little something called the blockchain.
The blockchain is a new and exciting bit of technology that has bulldozed into our lives during the last few years and is steadily revolutionising the way we do things.
From endless uses in our personal lives to a myriad of benefits in the business world, Blockchain is here to stay.
But many people are wondering what the point of it is – what is all the hype about, is it just a trend or a flash in the pan, how can Blockchain technology help B2C companies become more profitable?
The answer is in a lot of ways. We don’t know the full extent of its potential yet, but one thing is for sure, it’s going to be big.
With various governments, big international companies, and businesses all showing interest in regulating and implementing blockchain technology into their way of doing things, things are looking pretty exciting.
But first, let us start at the beginning to make sure you have a clear understanding of precisely what the technology is, and then we will go on to give you the lowdown on real-life implementations as well as ideas on what it can be used for, and how it can save businesses money.
What an exciting time to be alive!
Table of Contents:
What Is Blockchain Technology?
Ok so for those that do not know, or are not sure, we thought it best to provide a little explanation of exactly what the blockchain is and what blockchain technology entails.
In the most basic of terms, the blockchain is a growing list of records that is continuously updated. These records are known as blocks, and they are all intrinsically linked and secured through the means of cryptography. Each block contains what is known as a cryptographic hash which includes data of the previous block, a timestamp, and the transactional data.
Through its design, the blockchain is entirely resistant to any data modification and cannot be tampered with or edited in any way.
In other words, it is an open source, the distributed ledger that can record transactions that are carried out between two parties efficiently and in an entirely verifiable manner.
The blockchain is typically managed by a P2P network which collectively adheres to a particular protocol that manages inter-node communication and validates new blocks. Once recorded, the data in each block is unable to be changed retrospectively without altering any of the subsequent blocks which would require the agreement and collusion of the network majority.
Blockchain was invented in 2008 by Satoshi Nakamoto for using in conjunction with the cryptocurrency Bitcoin. It was initially designed just to be a public transaction ledger for the currency, and it became the first digital currency to solve the issue of double spending without the need for a centralised server or a third party authority.
Since its invention, Bitcoin and the Blockchain have completely revolutionised the Fintech Sector and have inspired countless other digital currencies that have followed in its footsteps.
The blockchain is secure and is perfectly suited to recording events, medical records, identity records, transaction processing, traceability, voting, or documenting provenance. It is also particularly useful in supply chain management and for assisting with logistics and transportation operations.
But it also has a lot of potential when it comes to B2C companies and increasing their profitability. This is how it does it.
Read more technical details in our Guide to Blockchain Technology.
Blockchain for Business
While the blockchain was originally designed just to facilitate Bitcoin transactions, it has become clear that it has many other uses. The potential of this exciting and disruptive bit of technology is starting to revolutionise the business world.
Already, Blockchain technology is being implemented by some of the worlds largest and most successful companies. These are some of the industries that are harnessing its power not just to save money but to enhance their client experience:
Over half a million lives are lost every year due to issues with the integrity of drugs as they pass through the supply chain from manufacturing to consumption.
Healthcare companies and life sciences firms can create unique serial codes for each unit of medication, as well as equipment and through the scanning of these numbers, products can be verified entirely and their progress through the supply chain registered on the Blockchain.
If applied in the right way, this process can cut costs, elevate security, and increase trust. Because Blockchain cannot be tampered with, it means that the supply chain can remain uncompromised and everyone can rest assured that the end product is what it is supposed to be.
Read more about Blockchain In Healthcare Sector.
From the perspective of the supply chain, the blockchain can be used to enable trust between trading partners and consumers.
Garments can be recorded on the blockchain and from the moment of manufacture, to the moment it is in the consumer’s hand, they can track where it has been and its full life cycle. In particular, sustainability and compliance can be monitored, and in the case of designer goods, a client can be assured that the item is not a replica or counterfeit item.
When it comes to making cross-border payments such as paying a manufacturer, paying for transport, or similar business related costs, often they can amount to quite substantial sums.
By using the Blockchain, payments can be effected quicker and more cost-effectively.
IBM recently announced a new blockchain banking solution that would allow financial institutions to process payments across borders.
IBM has also partnered up with food suppliers such as Dole, Nestle, and Walmart to implement better food safety processes through the use of blockchain.
In the world of the global food supply, the supply chain involves a considerable number of different parties such as suppliers, processors, distributors, retailers, regulators, and consumers and all of these are relying on trust that the others have done their job correctly.
Through the use of the blockchain, all information about the origin and the journey of the food can be recorded in its transactions. All members of the ecosystem can use the blockchain network to trace contaminated goods to ensure that they are removed from shelves promptly.
When it comes to precious gemstones, in particular diamonds, being able to tell for sure where they came from and that they are ethical is not only a big concern but a legal one.
By using blockchain, companies will be able to track the cycle of the diamond from when it is mined, to when it is cut, so when it is sold. This way, people can rest assured that they are not purchasing illegal blood diamonds or conflict diamonds.
Blockchain Uses In the B2C World
It is clear that Blockchain technology suits internal operations within companies, and it also has extensive uses in a B2B environment, but what about the B2C sector?
Finding a way to implement it in a way which will improve customers experience, simplify processes and procedures, and save the company money is the winning combination.
Other uses of Blockchain technology in the B2C word include in the area of claims management – medical claims, auto insurance claims, life insurance claims – all of these can be simplified through the use of the Blockchain.
The claims processing process can be notoriously lengthy and complicated and require verification from a range of intermediaries before a payment can be paid out to the claimant.
It can also be an expensive procedure, relying on so many third parties and needing to engage them.
By using a smart contract, a claim form can be sent to all participants in the chain at the same time, and the smart contract would be able to automatically and securely complete all of the steps from automating coverage verification to ok-ing the payment.
The same idea can also be applied to mortgage and loan processing. As it is also a very complex with multiple processes and stakeholders involved, inherent inefficiencies and frequent human errors and delays can cause a lot of frustration.
The whole process could be made a lot more simple as well as cheaper if the concepts of smart contracts were introduced. For example, smart contracts would automatically be able to verify land ownership and communicate with stakeholders such as legal and tax departments.
Realistically, blockchain could do away with the need to communicate or hire a lawyer in many instances. This will reduce costs, time, and better support the customer and their experiences.
Another B2C concept that can be improved by the use of Blockchain is parking solutions.
If you combine smart contracts with sensors that can read car number plates and detect movement, then it becomes possible to automatically deduct parking fees from citizens using either digital parking wallets or a credit or debit card that is linked to the identity of the driver.
This would make some significant improvements to the existing system. It would mean 100% compliance with parking fees and fines, more accuracy with payments, no need to manual patrolling, automatic computation of occupancy ratios, and more. The implications are huge.
The truth is that we have not yet fully realised the potential that blockchain technology has.
Every day, new companies and trailblazing individuals are discovering new and exciting ways that we can utilise this exciting technology to improve the way that we do things. The more we explore, the more ways we will find to integrate blockchain technology into our lives to help us streamline them and save us time, effort, and money.
One of the main ways that blockchain can save businesses money is through payment processing.
The ability to be able to send, receive and track payments without any additional fees or charges, and even on a cross-border basis is enormous and will make a massive difference to businesses balance sheets.
Then when it comes to supply chain management – being able to track every stage of a product’s journey in one place and in real time will not only save companies a fortune, but it will increase customer satisfaction and trust in the client and in the product itself.
Then regarding processes such as applying for loans or credit cards, selling houses or cars, using the Blockchain will significantly lower costs while increasing the accuracy and efficiency of the whole process.
Another way companies can save money is through utilising smart contracts in the purchasing cycle – when a client places an order, say through a chatbot or website, then the various steps of the processing and dispatch can be carried out automatically via smart contract. Meaning there is no need to have a 24/7 customer service team on standby.
These are just some of the real-life implications and implementations of blockchain technology within the B2C sector, but with more coming out every day, this is a sector that is making continuous breakthroughs.
One thing is for sure, and that is that blockchain technology, while technically in its infancy, has so much to offer the world of business, as well as members of the public.
In a few years, I expect blockchain to be used in all sectors such as government, finance, medical, legal, retail, HR, and even entertainment. The sky is the limit and regarding it improving our life, I don’ think we have even begun to scratch the surface of what Blockchain technology has to offer us.
Read more about How Blockchain Enterprise Can Change the World.