It's not just a buzzword. Blockchain technology may have an enormous impact on the retail industry and 2018 is shaping up to be a critical year. Top retailers have been exploring blockchain and a few are now moving forward with real-world uses for the technology (more on that below).
Blockchain is essentially an immutable, shared digital ledger for recording the history of transactions. In this permanent record of transactions each "block" is linked to the one before it, and secured with cryptography, making it resistant to tampering.
"When a transaction is posted on the network between two parties, other nodes on the network compete to solve a mathematical proof that locks that transaction into everybody else’s ledger as well," explains Karim Lakhani, Harvard Business School professor, to the Harvard Business Review. "So if you wanted to go back and hack the blockchain ledger, you would have to undo every single other prior transaction."
This unbreakable trust has many implications for retailers.
Blockchain can impact food safety, food fraud, and supply chain accounting. It can also generate trust and transparency for consumers. As more and more shoppers care about the origins of their products, from luxury goods to food for consumption, blockchain can power the verification of each product. In the supply chain, communications between parties can be direct and instantaneous. Counterfeit goods can be eliminated. Food safety issues can be tracked back to the source.