The utilization of Blockchain in beauty industry isn’t rocket science. However, those immersed in the global cosmetics market may find it challenging to develop Blockchain solutions in beauty and wellness industry without any prior experience in the technology. This is where a Blockchain development company comes to save the day. Before consulting one for your business, it is crucial to understand the prominent challenges and how the usage of Blockchain technology in beauty industry will empower global cosmetics brands in the future.
The following are some major challenges plaguing the beauty industry. From supply chain opacity to counterfeiting products, the industry is ripe for disruption.
The manufacturers mimic the original brands that don’t surpass the quality tests and increase the risk to public health as they contain harmful ingredients. Authorities in the UK in 2018 recovered the counterfeit beauty products containing mercury and hydroquinone (skin-whitening agent) in a high amount. Another case in the UK revealed the fake products containing human urine, arsenic and rat droppings. Additionally, police in Los Angeles also warned the consumers about the counterfeit products with bacteria and animal waste.
The supply chain process of the beauty industry is complex, as it involves several stages, such as planning, production, inventory management, warehousing, logistics, etc. The products have to travel long distances to reach the end consumers. Such a complex process makes it challenging for consumers to determine where and how the products are manufactured.
The Epsilon study conducted shows 80% of customers are more interested in buying from a brand that offers them personalized experiences. The statistic represents the importance of personalization in the market. Personalized services require a rich source of user data, including the consumer’s personal information, purchase history, beauty preferences, and more. This data can easily be misused if accessed by hackers or other unauthorized parties. They can use the data to steal identities, or commit fraud.
Be it a B2B or B2C market, loyalty programs such as credit card points and discount coupons act as an effective tool to keep the consumers aboard. However, programs with time delays and high costs can affect the consumer’s loyalty program experience. Besides this, the lack of traceability in the program makes it difficult to track the reward claims, expiry dates, claim transactions, and their processing for each customer.
Web3 is the third major evolution of the internet that is empowering the beauty industry with technologies like Blockchain. Companies can benefit from Blockchain’s innovation and opportunities to gain maximum efficiency in supply chain, production, logistics or other processes.
Blockchain’s immutability, security and transparency characteristics appeal to several businesses and encourage them to enter into the Web3 world of innovation. This distributed ledger technology enables businesses to work on pain points of their beauty venture in order to offer a seamless experience to consumers. Riding the wave of Blockchain development for beauty industry would strengthen the business’ presence in the highly competitive world of beauty.
The following are the ways Blockchain overcomes the challenges of the beauty industry.
Transparency is one of the major challenges and Blockchain development for beauty industry is an ideal solution for this. The decentralized structure of this distributed ledger technology enables real-time tracking of products at every stage of the supply chain. Each and every transaction and movement of the products recorded on Blockchain ensures transparency and accountability. This transparency provides consumers a deep insight into a product’s journey.
In 2021, European luxury brands LVMH, Prada, and Richemont partnered with The Aura Blockchain Consortium in order to provide consumers with a maximum transparency and traceability throughout the product life cycle.
The immutable ledger of Blockchain records each and every step of the beauty products journey, starting from ingredients sourcing to distribution. This record is accessible to consumers that allows them to determine the authenticity of products. It eliminates the chance of counterfeit products to enter into the market and help restore consumer confidence.
Cult Beauty, a global online cosmetics brand headquartered in London, utilizes Blockchain working with Provenance, a software developer that designs robust applications to provide increased supply chain transparency. This transparency reduces the risk of counterfeiting.
Blockchain is a self-sovereign industry that provides an ease to users to control their personal data. The consent mechanisms and decentralized identifiers allow the consumers to be selective while sharing the data with brands without compromising the privacy. Such a personalization ease offered by Blockchain in beauty industry increased the trust between them and beauty brands. Companies can achieve this motive availing the services of tech firms specializing in building Blockchain solutions for beauty and wellness industry.
Blockchain technology in beauty industry offers a reward and loyalty solution that can help in dealing with all reward related transactions in a hassle-free way. The increased transparency enables the easy tracking of rewards and related transactions. It builds trust towards the brand, increases brand revenue and helps maintain customer loyalty.
Em Cosmetics, founded by Youtube beauty guru Michelle Phan, partnered with Lolli, a cryptocurrency reward company, to offer up to 4.5 percent portions of Bitcoin to customers who shop with Em Cosmetics and download Lolli’s web extension.
Blockchain in beauty industry is a game-changer. The way Blockchain technology overcomes the challenges of the beauty industry, no doubt, more beauty brands will adopt the technology and maximize their operational efficiency. As a Blockchain development company, Antier understands the growing demand of Blockchain in beauty industry and hence, our proficient team is ready to deliver tailored solutions to the clients. Schedule your consultation calls with us today for your Blockchain development project.
