The Main Challenges of Buying Products Online
The world of digital commerce is rapidly exceeding expectations as online shopping across the world keeps growing exponentially. According to Statista, there will be 1.92 Billion global digital buyers by the end of 2019, and eCommerce sales are expected to account for 13.7% of retail sales worldwide. While these staggering numbers speak to the immense potential to the eCommerce industry, they also point to something that is becoming increasingly relevant; consumer trust and brand protection.
A recent customer acquisition study by HubSpot has suggested that as many as 81% of consumers trust the advice of friends and family over businesses, and brands are fast losing their trust amongst customers. Four out of every five people stop doing business with a company because of poor customer experience, but that’s only one aspect of running a business. Online businesses have to contend with a host of other problems that, if not mitigated, can prove to be their death-warrants.
Customers need protection again counterfeiting
Whether shopping for everyday household items or looking for expensive, luxury items, one of the most important considerations for any consumer is whether the product (or seller) is legit. With the explosion of eCommerce, you can be sure that the market is rife with counterfeit products as well. And because products online are intangible for the customer until delivered, there is often no way to be sure whether an item is original or counterfeit. Customers need a way to make sure their interests are safeguarded online, and their money is not going into fake and often low-quality replica products.
Brands need to protect themselves as well
On the other of the spectrum are businesses that have more to worry about counterfeiting. Not only does it siphon off their profits towards disreputable, third-party businesses, it also creates an adverse brand image by developing the negative customer experience. Counterfeiters shoulder neither the responsibility of maintaining quality nor maintaining customer satisfaction – and the burden falls squarely onto the legitimate business itself.
Businesses need a way to safeguard against counterfeiting and build a system of trust where their customers get exactly what they pay for, and quality control is maintained to ensure customer satisfaction.
Logistics and tracking can go a long way
For some customers, it can sometimes be essential to keep track of when their products will arrive. As many as 83% shoppers in the US expect regular communication about their purchases. 53% won’t even buy a product if they don’t know when it will arrive. This presents a unique challenge for businesses – provide tracking information and maintain smooth logistics to ensure that purchases are delivered to customers on time.
Furthermore, vulnerabilities within a company’s logistics network (I.e., suppliers, distributors, third-party vendors, etc.) can lead to a significant loss of revenue in terms of lost shipments, misdeliveries, inefficient routing, faulty supply materials, damaged or stolen items, and so on. These businesses need a way to store all logistics information centrally, to avoid loopholes in logistics and maintain accountability within their networks.
Blockchain as a solution to major eCommerce challenges
The latest innovations in technology can be (and indeed are already being) used to tackle some of the challenges faced by online businesses today. An example of such technology is blockchain. Blockchains provide a decentralized ledger, which means that transactional information is stored in a way that makes it impossible for one single party to control or alter it. This makes the ledger immutable and can form the building block of a system that accurately maintains product authenticity, ownership, and any other relevant detail.
One such implementation of this concept is provided by LuxTag, a company that offers anti-counterfeiting, proof of ownership, and track and trace for products and assets to manufacturers. Our product tagging using blockchain technology enables businesses to mitigate some problems associated with online shopping.
Tagging products on the blockchain means that an authentic record and proof of true ownership can be maintained. For businesses, this means that any products they make can be tagged and therefore traced, thus eliminating counterfeit products. In addition, customers are able to check whether an item is authentic or not, and who is the original owner of an item. This can discourage theft of items tagged on the blockchain.
Furthermore, items tagged through QR codes or NFC tags can be tracked during logistics, enabling businesses to streamline their operations and customers to track the location of their purchases for delivery. LuxTag also provides business insights to manufacturers regarding their product ownership, usage, and resale.
While the blockchain technology comes with its own set of challenges, it has the potential to change business operations and shape the future of eCommerce.