LVMH launches a Blockchain Service as Authenticity
LVMH - owner of Moët, Hennessy, Louis Vuitton, Dior, Celine, Loewe, and Givenchy, among others, decided that it's time to fight counterfeit market in fashion industry.
The value of it counterfeit goods reached $1.2 trillion in 2017, nearly $100 billion of which was directly linked the fake luxury goods
LVMH partnered with ConsenSys and Microsoft t launch AURA - a platform that it says:
“...aims to serve the entire luxury industry with powerful product tracking and tracing services, based on Ethereum blockchain technology and utilizing Microsoft’s [cloud computing service] Azure.”
Bockchain-based service will make it possible for consumers to access the product history and proof of authenticity of luxury goods — from raw materials to the point of sale, all the way to second-hand markets, and who knows - maybe even further in future. That sounds like a dream and the whole industry definitely needs it. The question is - will it work as expected and will we be able to trust it? Since, with such a services, we always have a weak point - which is data entry.
Additionally, we have to remember that a lot of people simply want to buy fake luxury goods, so we will never fully eliminate counterfeit market. Interesting article about consumers intentionally in search of fakes can be find under the link in the FashinLaw.
However - what LVMH aims here for is to minimise the likelihood that consumers can be tricked into buying fakes. It happens a lot, especially on so popular online marketplaces where everyone can pretend that they have original product. This prvoes, that in addition to the increased sophistication of many counterfeit products, the methods for accessing these goods have similarly improved. But this is a different story, let's come back to AURA.
As for how the AURA system words: newly-made products will be “recorded on the shared ledger, irreproducible and containing unique information.” Then, “at the time of purchase, a consumer can use the brand’s application to receive the AURA certificate containing all product information.
” This information will carry over to seasons – or years – later when a product, such as a bag, is off-loaded with a resale site and purchased thereafter.
To date, LVMH says that:
“several brands from the Group, such as Louis Vuitton and Christian Dior, are currently involved, and advanced discussions are underway to onboard additional brands from the LVMH Group, and other luxury groups globally.”
As I am a huge fan of blockchain technology I support such initiatives with whole my heart. However, we still have to solve the issue with data entry point, as well as make sure that the platform will be reliable and up to date. Project is definitely challenging and I cant wait to see the results. Fingers crossed!