A Gartner report said that the commercial value-added services of the blockchain in 2025 will exceed $176 billion, and will then exceed $310 billion in 2030. There is no doubt that more and more companies are adopting blockchain technology to improve the security, timeliness and scalability of online businesses. This is the case in the e-commerce industry.
eMarketer estimates that sales of retail e-commerce reached $2,304 trillion in 2019, an increase of 24.8% over the previous year. In addition, mobile commerce accounted for 58.9% of global e-commerce sales. This indicates that the emerging e-commerce industry has matured and the time has come to subvert through blockchain technology.
- National University of Singapore Visiting Professor Bai Shifang: FinTech Promotes Tech Finance
- Comply with the trend of the times and push the development of blockchain industry norms
- Babbitt Exclusive | Read the legal issues of blockchain projects. Is token incentive and chain reform feasible?
- From quantum computing to blockchain: frontiers, trends, and challenges
- Take bitcoin to pay? How much do you want to open?
- Quote analysis: Changyin has emerged, short power is beyond imagination
Now, with the mainstreaming of blockchain technology, Amazon and many similar e-commerce companies will experience a major “catastrophe” or transformation. There are two main drivers of this shift:
1. Decentralization trend of anti-monopoly
As we all know, the e-commerce industry is almost completely monopolized by a small number of players. Existing companies have few challengers, and the cost of changing the monopoly is too high. Often, any industry that is almost monopolized will generate a new technology that will disrupt the monopoly. In 2007, Nokia was the king of mobile phones, then Apple, and people were the least optimistic about Apple becoming a disruptor. Similarly, when IBM was at the forefront of the computer world, Microsoft became a disruptor.
It is time for the blockchain to disrupt the entire e-commerce space. Blockchain technology is essentially decentralized control and ensures trust is achieved without the need for centralized power. In addition, it also means that end consumers have greater transparency and greater power.
2. Regulatory reform
One of the biggest changes in regulation is the introduction of the European Data Law, which came into effect on May 25 this year. The data protection law will have a huge impact on blockchain technology and e-commerce companies. Whether it is the General Data Protection Regulation (GDPR) or other regulatory frameworks, monopolies in the e-commerce sector are beginning to be attacked by different types, and new regulatory reforms will have a major impact on existing participating companies.
How the blockchain changes the current e-commerce industry
1, the payment method will be adjusted
The emergence of projects such as Bitcoin, Ethernet and Ripple has witnessed the framework of the blockchain and the integration of technology and currency. Today, cryptocurrencies are beginning to be used as a substitute for traditional currencies. This change is relatively easy to implement and they are decentralized. Bitcoin and various other cryptocurrencies have multiple advantages over traditional currencies, which is good for both merchants and consumers.
Some important advantages are as follows:
Decentralization: Blockchain is not regulated by any central authority, which usually means that buyers and sellers control the operation of the blockchain, and no third party can manipulate or review its transactions. Like other currencies, no bank or government can devalue or inflate cryptocurrencies. For example, if the economy of any country today collapses, their monetary value may suffer huge losses, while bitcoin does not, because geopolitical or geographical environment does not affect its operation.
Privacy protection: Cryptographic currency based on blockchain technology does not reveal the identity of the parties making the transaction. But because distributed books store transaction details and provide visibility, these transactions are transparent.
Freedom of trading: There is no specific regulatory agency to control how anyone uses their bitcoin. In most cases, regular payment methods impose various restrictions based on quantity, even geographic location. However, Bitcoin is a blockchain-based currency that has no restrictions on spending limits and provides users with absolute trading freedom.
Transaction efficiency: Traditional transfers usually take a long time, especially in different countries. It may take several hours to complete. On the other hand, bitcoin transfer takes only a few minutes! The most important thing is that they won't close at any time, and transactions can happen at any time. (Editor's Note: There is room for discussion here. The efficiency of blockchain transfer transactions is still not ideal compared with Visa and Alipay. This is closely related to the blockchain expansion problem. The solution to the expansion problem will bring more transaction efficiency. Upgrade.)
Reduce fraud: Due to the use of peer-to-peer technology, it is difficult to crack the process and commit fraud. Therefore, it is one of the safest ways to trade currently available. With recent developments, the e-commerce market is likely to allow customers to use Bitcoin for payment soon. In addition to decentralization, ease of use and security, remittances and collections will be as convenient as scanning QR codes. It is likely that the convenience of payment and collection is the first blockchain implementation in the e-commerce market.
2. Improve supply chain management
Supply chain management is probably one of the most pressing issues for all e-commerce companies. Given that the supply chain is an essential element of any e-commerce activity, implementing a blockchain in that sector will likely address many key issues. Blockchain can be used extensively to solve supply chain problems such as record keeping and tracking products to reduce damage and better replace centralized databases.
Other uses in the supply chain are –
Full transparency: In blockchain-based supply chain management, product information is accessed through built-in sensors and RFID tags, simplifying source and record keeping tracking. The product timeline from the creation of the product to the current location can be easily tracked through a series of blocks. In addition, accurate source tracking types can be used to detect anomalies in different parts of the supply chain.
Reduce costs: When applying a blockchain to enhance the supply chain management process, the additional costs incurred by the system are automatically reduced while ensuring transaction security. In addition, while saving money, intermediaries are exempted to eliminate the risk of fraud and product duplication. Suppliers and customers can use cryptocurrency payments directly in the supply chain without the need for customers or suppliers to process payments using EDI or the like.
Inventory management: Blockchains can also be used extensively at the back end of the supply chain. For example, inventory management becomes easier by introducing a series of blocks into the process. The implementation of blockchain effective inventory management has enabled retailers to avoid the unnecessary costs of rehiring new employees.
3. A more transparent e-commerce market
Many large retailers have recently been accused of lack of transparency, which is one of the serious problems facing existing e-commerce platforms. For example, Amazon disables the business page without any explanation. Therefore, applying blockchain technology to the e-commerce market will create a decentralized environment in which any misconduct by the business or merchant can be effectively monitored.
The transparent e-commerce market can also easily and efficiently conduct a variety of transactions without any friction.
In addition, with retail giants such as Unilever and Walmart announcing the recent blockchain project, it is clear that industry giants are eager to gain a foothold in blockchain products.
Today, blockchain is easily seen as one of the safest platforms on the market. DLT or distributed ledger technology (blockchain is one of them) provides advanced security for online database platforms, making it an ideal choice for e-commerce implementations. In addition, the number of security vulnerabilities in blockchain-based networks is almost negligible.
For e-commerce companies, another critical blockchain product is based on blockchain currency that does not provide personally identifiable information.
Cryptographic currencies such as bitcoin work like cash because they don't require consumers to disclose sensitive data. In fact, the customer himself authorizes the transfer of his personal "wallet" to the recipient. The only individual data associated with each wallet of the user is a randomly generated unique identifier.
| As data theft and cyber attacks increase tenfold, the risk of losing customer data is inevitable. Therefore, the use of blockchain is also the absolute key to solving these problems.
5, after-sale reviews and customized offers
Comment authenticity: The quality of product after-sales reviews can determine the order in which companies appear in the e-commerce market or search results. Fabricating comments undermines the reputation of a good company while promoting fraudulent business. The reputation of any online business depends on the legitimacy of its critics. As a result, most online operators are increasingly focusing on product reviews on the web. Therefore, blockchain technology can be used to validate key sources of opinion on a product or service.
Blockchain deployment can help contain invalid comments because the blockchain stores the data in a block and then adds it to a chain of similar information blocks. Each block must be verified on the computer network before it can be added to the chain. Once verified, it cannot be changed. The technology can also be used to create a person's digital map that cannot be changed.
Customized offers: Blockchain technology in business processes can be a great benefit for marketing, because when customers reach a specific expense column, you can use the blockchain to assign redeemable bonus points to customers. It allows customers to benefit from both general discounts and custom offers, while allowing proper tracking of dataset technology, which will make blockchain technology more efficient.
6. Save time and money for consumers and retailers
The share of total payments in various e-commerce transactions is a key method for traders to achieve their own profits. Unfortunately, the more participants on the payment network, the higher the cost to the customer. The lack of direct contact between buyers and sellers complicates customer awareness and forces them to pay more for more entities.
Customers obviously want to reduce the total cost of online transactions. A study found that 90% of customers said that free shipping (at Amazon's premium) is the main incentive for them to do more online shopping. However, retailers who are not all who benefit from the boom in e-commerce can also benefit from adopting blockchain. Currently, on average, 6 out of every 10 retailers are affected by online commerce: more and more people return goods after purchasing goods. 22% of brick-and-mortar stores choose not to sell online, due to huge shipping and return costs, while many physical stores increase prices to cover these additional costs.
The blockchain is independent of the middleman network and has automated features that will ultimately reduce the overall cost of retailers and consumers by reducing the amount of fees paid to other third parties. While this may not fully address the issue of high return costs, fewer intermediaries and associated costs may be sufficient to make more retailers competitive in this online marketplace.
to sum up
It is now clear that blockchain plays a vital role in the e-commerce industry, which is why more and more companies are using blockchain to make their e-commerce more secure, easy to use and fast. . There are currently many e-commerce companies in Dubai that are using the blockchain capabilities to provide online store development services.
This article is from the official Blog of Dataseries
The translation is provided by First.VIP_Maggie. Please keep the information at the end of any reprint.