Blockchain retail: starting from traceability, stagnation

Retail is the most active area of ​​the market economy. From the planned food stamps, to the department stores in the era of insufficient capacity, to the retail platforms of multi-brand strong channels, to the new retail, the center of the retail industry is gradually shifting to “people”.

The new retail is a revolution of efficiency. Its essence is that new technologies drive the reorganization of the relationship between people, goods and fields, improve the stickiness of consumers, speed up the flow of goods, reduce inventory, and increase the effectiveness or effectiveness of the “field”.

The blockchain is regarded as a “production relationship tool”, which can return sovereignty to consumers and place high hopes on “changing retail business from business model” and reconstructing the relationship between “people and goods”.

Retailers have long been concerned about the blockchain, and Wal-Mart, Amazon, Carrefour, Jingdong, Suning, etc. have already applied retail blockchain applications. The Zinc Link is informed that Wal-Mart will begin to scale the application of the blockchain traceability system in the Chinese market.

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According to IBM's Consumer Products and Blockchain Implementation Report, published in 2018, 70% of respondents in the consumer goods industry expressed their desire to build a blockchain production network in the next three years.

New retail is still early, blockchain retail is beginning to take shape

On May 31 this year, the Box Horse Xianshengmen Store, located in Kunshan Wuyue Square, Suzhou City, was closed for the first time since the opening of Box Ma Xiansheng. Hou Yi, CEO of Box Fresh Health, said in his speech "The Battle of Filling the Hole in 2019" that new retail participants must return to the essence of retail, figure out what the new retail is, and fill in new retail.

More than two years ago, Ma Yun, Chairman of Alibaba's Board of Directors, proposed the concept of “new retail” at the Alibaba Yunqi Conference. On the same day, Lei Jun also proposed “new retail” at the China (Sichuan) E-Commerce Development Summit, followed by Jingdong and Tencent. Also started the layout.

This "incompatibility" indicates that the emergence of new retail reality is much earlier than the concept. In general, the changes that new technologies bring to the retail industry are visible to the naked eye, and when it is completed, it will bring “quality changes” to the business model. The node proposed by the new retail may be the beginning of qualitative change.

Then, the market's exploration of new retail is multi-faceted, with a thousand “new retails” in the eyes of a thousand people. Alibaba's box horse fresh, Yonghui's super species, unmanned shelves such as the convenience of the bell, convenience bees, etc., unmanned convenience stores such as Amazon's Amazon GO, Binguo box and so on. So far, no model has been verified as a successful new retail.

The new retail has stumbled in the past three years and is still groping. His development is inseparable from new technology solutions such as artificial intelligence, blockchain, and cloud computing. The so-called "blockchain retail" in the industry is currently only at the stage of technology exploration.

Blockchain + retail: starting from traceability, not only traceability

In the blockchain application of retail industry, the traceability of goods is the most widely used item. It can be said that almost all retailers' blockchain applications cannot circumvent the traceability of goods.

1) Retailers line up to enter the "product traceability"

Nowadays, counterfeit and shoddy goods are dazzling and dazzling. The threshold for counterfeiting of small commodities is low, and the cost is controllable. In the end, the vast majority of consumers are selected. They choose to go and buy home products that are problematic. The development of new retail will definitely solve such problems first.

A major application of commodity traceability is anti-counterfeiting. The platform obtains information on production, transportation, storage and other aspects of the supply chain. Consumers obtain traceability information by means of scanning codes. Consumers recognize the authenticity of the data and the stickiness to the platform.

JD.com launched the blockchain traceability platform as early as 2017. According to Wen Hao, person in charge of blockchain application products in Jingdong District, as of February this year, more than 700 brands in Jingdong have access to Jingdong Global Blockchain Quality Traceability Program, and more than 50,000 products have been scanned by consumers. It has accumulated more than 1.3 billion uplink data, and more than 2.8 million after-sales users access the query, covering more than ten categories of fresh, agricultural, cross-border traceability.

During the “6.18” period last year, Suning Tesco launched the blockchain product traceability system on the online mall and offline stores. After purchasing the products, users can quickly query the product information by scanning the source code on the product.

Wal-Mart blockchain traceability project manager Xie Zhuolin told Zinc Link that Wal-Mart has used the blockchain for food traceability pilot projects in China and the United States since 2016.

2) Trusted data sharing in supply chain traceability

On May 30th, the public number "Children don't say" published an article entitled "With 285 days of evidence collection, I confessed to Netease Koala", saying that he purchased Shu Uemura's "Fake" cleansing oil at Netease Koala. Subsequently, NetEase Koala officially responded to the denial of sales, saying that its channel products are genuine.

This is not the first time that NetEase Koala has been involved in the “fake Luoshengmen”. It has been accused of “selling fake Estee Lauder and Canadian Goose products”.

In a series of fake Luoshengmen, Netease koalas are unable to prove their innocence. At its root, this is caused by improper management of cross-border supply chains. Netease koala lacks control over all aspects of the supply chain, and information is not transparent.

On the one hand, consumers are not aware of the authenticity of the source and channel of the goods; on the other hand, when consumers are accused of selling fake, Netease koala can not produce convincing traceability data, nor can it track where the problem occurs.

IBM data shows that companies are spending more than $300 billion a year because of the lack of visibility in the supply chain. However, not all retailers have strong supply chain management capabilities, after all, there are many links in the commodity circulation.

The blockchain provides a new supply chain management idea, and all links in the circulation participate in a coalition chain to maintain a data-sharing book.

Yao Ping said that the participants in all aspects of commodity circulation have joined Suning to launch the alliance chain. Different institutions will participate in different commodities, such as imported fruits. The participants will be overseas farms, production and packaging enterprises, customs, quality inspection agencies, and distributors. , logistics, etc.; and domestically produced goods, mainly producers, distributors, quality inspection agencies and logistics.

The benefits of blockchain traceability are multi-faceted. Wen Wei believes that for production companies, supply chain data sharing based on blockchain can provide full supply chain visualization and anti-counterfeiting management. For consumers, the traceability platform provides product circulation information, authenticity and inquiries, information is more transparent, and consumption is more assured. For the regulatory agencies, the source of quality supervision and management is improved by means of a traceability platform.

However, she added that the blockchain anti-counterfeiting traceability application is still in the early stage. The information collection of all production and operation details of the whole process is still unrealistic. The software, hardware and operation mechanism solutions of all links in various industries need to be continuously improved, and deployment applications also need transition. Time, "what part of the data can only be collected, which part to go first."

In addition to the alliance chain, IBM pointed out in its research report that retail is still a highly human-dependent job, and a large amount of data needs to be collected manually. In the blockchain, smart contracts can automatically adjust disputes about contracts and performance, and reduce human intervention in settlements.

Suning proposed smart logistics, using the blockchain distributed accounting system, big data and vehicle networking to achieve refined management of the entire logistics process. For more information on blockchain logistics, the details of Zinc Link's previous manuscript "Blockchain + Logistics: Building an Intelligent Logistics Trusted Eco-Network".

3) Shared traffic ecology

Compared to the retail supply chain, the blockchain-based traffic ecology is another story. This is a new story that no one can tell.

On the one hand, consumers can redeem goods and services by contributing personal data, time to receive corresponding rewards. On the other hand, these consumers aggregate to form a pool of traffic, and businesses in the ecosystem share these flows and give back.

The new retailer from the media, Ye Kai believes that the new retail based on blockchain may subvert the spread model and enter the era of true consumer sovereignty. Consumers price their own things and then sell them, such as contributing data and completing tasks to obtain rewards. To redeem goods.

The Hach Manor of Jingdong and the Starfield Home of Suning are this model, and the two applications are still in the very early stage. In general, the functions of this type of product are relatively simple, and whether it can carry the member's ecological maintenance is still a question to be solved.

In July 2018, Suning launched the "Star Home" application based on blockchain technology. Yao Ping, technical director of the Suning Technology Block Chain R&D Center, told Zinc Link, which is a member of Suning's ecological application. The positioning of Star Home is “to create a shared platform for value sharing across the food, clothing and housing”, which can be applied to Suning Smart Retail.

The Zinc Link opens the app and discovers that “Planet Residents” have the unique blockchain identity, which can be retrieved by picking up the star fruit, shopping, walking, etc. The results and rewards are recorded in the block.

In addition to the member ecology, Yao Ping told Zinc Link that Suning developed a data joint analysis platform based on multi-party secure computing + blockchain technology. The platform is used for two or more enterprises to build a more complete user image without revealing their original data. Cooperative companies can tap into more business value through this sophisticated user image, such as precision marketing.

Regarding traffic ecology, a common consideration in the industry is to build a shared traffic pool. Haier's ecological platform based on traceability is based on this concept.

Haibin Food Association's leader in integrity traceability project, Kong Bin, told Zinc Link that different brands joined together to create an ecosystem platform and bring consumer traffic to the platform and secure the chain nodes. Haier Smart Refrigerator will provide users with customized services such as healthy recipes to generate user portraits. In the future, on the ecological platform, users can choose whether to authorize personal data and obtain corresponding services or rewards.

He added that these are built on the blockchain, and even if one node exits, it does not affect the operation of other nodes.

BUMO also proposed a model of Token's integration with the community economy. Its co-founder Guo Qiang told Zinc Link that BUMO partners are the world's largest sports shoe manufacturer and distributor, but now they are in a dilemma – Taobao and Jingdong As a warehouse, the gross margin is very low. The advantage of e-commerce is in the price/performance ratio, the platform has a low discount, and the manufacturer has no bargaining power.

Therefore, BUMO proposes Token incentive mechanism based on the existing social economy. “Community KOL helps runners organize activities, obtain tokens, and can exchange limited edition shoes. You can get one tenth of a month if you run 100 kilometers. Double shoes. This model can bring direct sales to the community without going through the e-commerce platform.

In addition, the application of blockchain in the retail business is also the existence of certificates, electronic certificates, blockchain invoices and so on. These applications are not unique to the retail industry and are therefore not specifically described.

Technology is not full, don't talk about change

The traceability of the blockchain makes it early for retail companies to focus on. Most applications are commodity traceability systems, and a few companies have begun to expand into supply chain management.

According to IBM data, executives in the consumer goods industry believe that there are many obstacles in the blockchain, including inadequate employee skills, immature technology, regulatory restrictions, insufficient business cases, unclear return on investment, and lack of executive support.

With regard to the traceability of goods, it is not only based on the blockchain. Some retailers have a relatively complete supply chain system, and the traceability can be completed based on this system.

Xie Zhuolin said that before applying the blockchain technology, Wal-Mart has already explored and utilized the data of massive SKUs. Among them, the product life cycle online management system "honeycomb" is an example, it can help trace the entire process of Wal-Mart's own goods from new product development to marketing.

He believes that the biggest advantage of the blockchain is to improve the transparency of information. Each link has data records that cannot be tampered with, reducing the possibility of violations.

However, the current product traceability solution still cannot guarantee the reliability of the winding process, and it also needs to ensure the authenticity of the uplink information by means of the hardware facilities of the Internet of Things.

Taking Jingdong running chicken as an example, Wenyu introduced the zinc link to the whole life cycle trace data of running chicken, including breeding process, slaughtering and processing, inspection and quarantine, warehousing, cold chain logistics and so on. Different data collection methods have been adopted in different links.

Take the farming process as an example. Running chickens require 1 million steps to be able to go out. They will wear a foot ring for each running chicken. As a unique ID card, record the number of steps per day and automatically wind up. In addition, through the data collection APP to record the breeding process, such as into the column, feeding, cleaning, disinfection, etc., the farmer only needs to open the APP to take photos or record video when the work is done in these links, the corresponding data will be automatically linked, and the APP automatically Collect information such as location, weather, etc. at the time without manual intervention.

Whether it's labor or the Internet of Things, ensuring real data is costly, which is a challenge for companies with less automated capabilities.

Wen Hao believes that in addition to the technical conditions of hardware and software, the standard operation is also the reason why long tail producers cannot achieve data winding. “For example, if the beef is traced to the source, the consumer should know which piece of beef the meat is from. The manufacturer has to store the beef of different cattle separately during the slaughter, which is associated with the original cattle ear tag (IoT data collection device). It can't be standardized."

On the one hand, the retail industry needs to change from a technical quantity to a business model.

On the other hand, public-chain projects are more imaginative, but lack the foundation for landing. The reason is that most entrepreneurs do not grasp the essence of retail, and it is difficult to design a business model suitable for the retail industry.

In “blockchain+retail”, the blockchain is still a traceability technology solution, and it has not seen the possibility of bringing business model changes. It can be said that starting from traceability, it still stops at the source, and the real retail of blockchain has not really been established.

As the technology matures, the boundaries of the area where the blockchain can be landed are gradually widening. Only the new business paradigm is proposed, and the true value of the blockchain in the retail industry can be explored.

Text: Chen Haining

Editor: Wang Qiao

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