Blockchain spend in retail industry to reach US$ 5.3 billion by 2022, driven by large scale adoption across the value chain

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Blockchain technology is disrupting a range of activities starting from supply chain management to services after sales in retail industry. According to TechInsight360’s Blockchain Spend Analysis Survey Q1 2019, emerging use cases of blockchain in retail industry include end to end product transparency, fraud prevention, managing loyalty points, enhancing customer purchase experience, maintaining consumer data privacy and building trust among customers.

According to Techinsight360, Blockchain spend in retail industry has increased at 93.6% during 2018 to reach US$ 699.3 million. Over the forecast period (2019-2025), spend on blockchain is expected to record a CAGR of 40.7%, increasing from US$ 1,296.4 million in 2019 to reach US$ 10,048.0 million by 2025.

Fundamentally, there are three key drivers for increased blockchain technology spend across markets. Firstly, there are use cases across the value chain which can increase revenues as well as reduce cost. Secondly, especially in developed markets, increased adoption by mid-tier retailers will drive spend on blockchain over the forecast period. Thirdly, innovative solutions are being launched by both large players and start-ups, which will drive adoption. Below are some of the key events highlighting increased adoption and use cases of blockchain technology in retail industry.

Blockchain spend in emerging markets in Asia Pacific has picked up over the last four quarters. Leading Indian retail brands namely Future Group, Shoppers Stop, Gini and Jony, Croma, Jack and Jones, Vero Moda and Only have increased investment in Internet of Things and blockchain technologies to drive growth.

China’s largest e-commerce and retailer, JD.com is extending the company’s retail as a service through blockchain. It is improving transparency and security of their operations by enabling their customers to build their own blockchain network solutions on both public and private enterprise clouds.

American retail giant, Walmart, is piloting a blockchain powered technology to fight E coli and other foodborne illnesses. Walmart has mandated its suppliers of green leafy vegetables to upload their food data to the blockchain network within a year. This is expected to help suppliers in tracing back their products back to the farms.

Beam, a global platform for retail payments, is changing the way mobile retail payments are made through the integration of blockchain and mobile phones. Beam rewards its customers for buying regular products through their phones. It has reportedly processed payments of value more than 250 million dollars for leading retailers like Costa coffee, Aldo, Tommy Hilfiger and Carrefour.

Turkey’s Gabrotech is revolutionizing the market for loyalty rewards. Gabrotech is a decentralised open loop system which empowers consumers to manage different loyalty programs through the Gabro digital wallet. The gabro or the GBO token which is at the core of this ecosystem can be changed for merchant reward points. The Multi Currency Conversion engine (MCCE) further ensures the liquidity of the GBO token and let users convert it into real time fiat money. It lowers operational costs by relying on Ethereum and builds trust by eliminating third parties interventions.

Eligma, a blockchain group in UK, is combining the power of AI and blockchain to disrupt the retail market. The group aims to create a single shopping account by connecting a vast number of e-commerce sites and second hand goods marketplaces. In addition to this, the blockchain network will allow the tracking of purchases and store warranties, purchase proofs, recall history and related paperwork in a digital framework.

Europe’s largest retailer, Carrefour, is using blockchain ledger technology to track the movement of various products from farms to their shelves. This is similar to Walmart’s strategy to eliminate foodborne health issues. While it will be a challenge to convince farmers to get onboard, Carrefour plans to widen the scope of the technology to its line of 300 fresh products globally by 2022. Apart from Carrefour and Walmart, Smithfield Foods, Nestle, SA, Unilever Plc and Tyson foods are among other notable retailers / food manufacturers who are investing in blockchain technology. Over the forecast period, TechInsight360 believes spend on blockchain technology to increase significantly with adoption by mid-tier retailers.

To know more and get deeper understanding of blockchain technology deployment in retail industry, click here.