Blockchain Bling: How Blockchain is Changing the Luxury Industry

Despite news that LMVH revenues grew 17% and Hermès was up 23% year over year in the first quarter 2023, leading the *Wall Street Journal* to report, “The world is volatile but luxury brands look serene,” some 43% of luxury insiders surveyed said that business conditions have already worsened for their companies.

Many of the most coveted brands in the world have successfully negotiated the move towards digital transformation. Louis Vuitton unveiled a new online chatbot service at VivaTech in 2021, claiming that, thanks to artificial intelligence, over 60% of customer requests can be processed 24/7. Gucci offers customers access to online sales advisors, and Chanel has been developing a virtual fitting-room service in association with Farfetch.

The Prada and LVMH-backed Aura Blockchain Consortium is rolling out a shared solution for brands to distribute NFTs. But leveraging blockchain for issues like fighting counterfeits and tracing materials is still in its early stages.

The Global Brand Counterfeiting Report has recently estimated losses of nearly $100bn, demonstrating the growing extent of counterfeiting in luxury goods. Before the parasite eventually consumes its host, can blockchain luxury goods help the brands to fight back and protect their identity?