E-commerce selling has been around for decades now and the evolution of the industry has been exceptional. Over the years the concept of online selling has been highly impacted by technological improvements. The latest amongst these technologies is Blockchain which is ready to revolutionize the industry with its unmatched potential. From the removal of middlemen to streamlining of operations and reducing complexities at all levels, Blockchain has a lot to offer to help e-commerce businesses resolve their everyday as well as long-term challenges.
In addition of course comes the fact that this technology is the foundation of cryptocurrency payments which makes it even more important for the e-commerce domain. It would not be wrong to say that blockchain is poised to change the way transactions are made. With this, both traditional brick-and-mortar setups and e-commerce businesses should be ready for radical changes. We will be focusing on the impact that Blockchain is going to have on e-commerce businesses shortly.
First Things First: Let’s understand the biggest e-commerce challenges
Before exploring the impact that Blockchain can cause on the E-commerce industry, understanding the challenges and pain points of the industry is a must. E-commerce is a complex domain where survival, sustenance and growth are even more difficult. Here are some key challenges that sellers in this domain have to face on a day-to-day basis as well as in the long run.
- The e-commerce market has always been very competitive, with participants of all sizes offering similar products and services. Moreover, more and more sellers are joining the bandwagon at a rapid pace. This includes new businesses as well as those transitioning from the brick-and-mortar model to this one. So businesses have to embrace smarter business models and technologies to stay in the race, right from setting up exceptional E-commerce stores to streamlining the processes that are to be carried on as a part of the business.
- Besides the challenge of huge competition, another pain point of the sellers is that the traditional business model has middlemen who take away a large share of the earnings during the selling process. For instance, sellers have to pay transaction processing fees to facilitate payments for the completion of the transactions. These fees cut down the profits of the sellers to a considerable extent and result in lower revenues.
- Protection of consumer data is another key concern for these businesses as they need to build the customer’s trust assuring them that their personal and financial details are completely safe. Furthermore, the implementation of data security regulations such as the General Data Protection Regulation (GDPR) has made data security a critical concern for online enterprises. For this reason, sellers usually have to invest heavily in data encryption and other measures to prevent hacking.
- E-commerce selling is a complex process as it involves an array of operations such as supply chain, logistics, payments, and more. Managing these operations and the intermediaries involved is another key challenge for the industry. From ensuring that the inventory is replenished at the right time, to streamlining the shipping and delivery functions, looking after customer relationships, and more, there are a lot of things that merchants need to manage.
As these challenges have been very great in the amount the sellers from the very beginning have been looking for one technology that is capable of handling them all. Fortunately, they have found their solution in Blockchain Technology. Being decentralized brings a host of benefits to the e-commerce industry. Let’s explore how:
- Payment Methods will be Improved- Blockchain-powered Cryptocurrencies that are being used as an alternative to traditional currencies are the first implementation of Blockchain Technology. Customers can choose to pay with Bitcoin, Ethereum, or Ripple in the same way as they would choose to pay with any other payment processor. Some significant features are listed below,
Blockchain is not regulated by any Central Authority which simply implies that only the buyer and seller control Blockchain operations. Thus, no third party can alter, delete or manipulate your transactions. Blockchain technology offers high security, radical visibility, and faster processing speed with traceability through the decentralized system.
Cryptocurrencies based on Blockchain Technology don’t reveal the identities of the transacting parties. Cryptocurrencies are like cash in that they don’t require the customer to expose sensitive data such as Credit Card numbers.
Freedom of Transactions
There is no Governing body to control how a person uses his/her Cryptocurrencies. Regular payment methods are often imposed with several limits based on the amount and even geographical location. However, this isn’t the case with currencies like bitcoin — Blockchain-based currencies gives users absolute freedom to perform transactions without any spending limit.
Ease of Use
Blockchain-based currencies are unbelievably comfortable to use. One doesn’t need to visit any regulatory authority to create an account like traditional currencies. All this can be easily done in the comfort of your home. Additionally, the virtual currency wallet is free, so you don’t have to levy any charges to open an account.
Traditional transfers often take long, especially sending money across continents may take up to several days to accomplish whereas blockchain transactions take place on a single network, reducing or eliminating the need for middlemen. The speed of the transaction is limited only by the speed of the network and by the speed at which new blocks can be generated.
Blockchain-based currencies are extremely secure to transact with. Because of peer-to-peer technology, it is tough to hack into the process and conduct fraud. Thus making it one of the safest modes of transaction.
- Supply Chain Management will get Revamped- Supply chain management is perhaps one of the most pressing concerns every E-commerce business is impaired with. As the Supply Chain is a critical element of any E-commerce business- Blockchain implementation in the sector will likely solve many problems. Blockchain can be extensively leveraged to solve supply chain issues like recordkeeping, tracking of projects as a less corruptible and better alternative to the centralized database. Other use cases of a supply chain include,
In a Blockchain-based supply chain, record keeping and provenance tracking have become easy, as the product information can be accessed with the help of RFID tags and embedded sensors. The timeline of a product right from its beginning to where it is at present can be traced through Blockchain. Besides this, the type of accurate provenance tracking can also be leveraged to detect anomalies in any segment of the supply chain.
When Blockchain is applied to increase the administrative processes in the Blockchain, the additional value incurred by the system is automatically reduced while still guaranteeing the security of transactions. The elimination of intermediaries also removes the risks of fraud, product duplicity while saving money at the same time. Customers and suppliers further process payments within the supply chain by utilising Cryptocurrencies rather than customers and suppliers.
Blockchain can be extensively utilized in the backend of the supply chain as well. For instance, the management of inventory becomes a whole lot easier by introducing Blockchain in the process. Blockchain implementations in inventory management enable retailers to avoid unessential expenditure on hiring new workers time and again.
- More Transparent E-commerce- With the recent backlash that big retailers have been facing in the wake of charges of lack of transparency — this is one of the more serious concerns faced by existing E-commerce platforms. For instance, Amazon was in the news for cutting off and even disabling a merchant’s page without any explanation. Thus, applying Blockchain technology in the E-commerce marketplace would establish a decentralized environment where any wrongdoings on the part of the business or merchant can be efficiently monitored. A transparent E-commerce marketplace also facilitates conducting transactions in a frictionless and efficient manner.
- Secure- Blockchain today, can be easily deemed as one of the most secure platforms out there. The Distributed Ledger Technology or DLT which Blockchain boasts offers excellent security for online database platforms that makes it ideal for implementation in E-commerce. Also, there has been almost negligible reporting of security breaches in blockchain-powered networks. Another significant upside that blockchain offers for E-commerce businesses is that blockchain-based currencies don’t exhibit personally identifiable information. Cryptocurrencies operate like cash in the sense that they don’t require a user to expose sensitive data. The customer himself permits a transfer from his/her own personal “wallet” to that of the recipient. The only discerning piece of data tied to each user’s wallet is a randomly-generated unique identifier. Since cyber-attacks and data crime have rapidly increased, there is an unavoidable risk of losing customers’ data. Therefore, adopting blockchain is the perfect solution to solve these challenges.
- Genuine Reviews- Good or bad reviews can determine the order in which a business appears in an E-commerce marketplace or a search query result. Fake reviews tarnish the reputation of a good company while at the same time promoting a fraudulent one. The reputation of an online enterprise relies on the legitimacy of its reviews. Hence many online operators have increasing concerns regarding the product service reviews found on the internet. Thus, making Blockchain technology an important source to verify the reviews on their products or services. Bringing Blockchain into the game can help restrict fake reviews, as blockchain stores data in blocks which is then added to a chain of similar information blocks. Each block requires to be verified across a network of computers before it can be added to the chain — once verified — it cannot be altered or deleted. The technology can be employed to create a digital map of someone, one which cannot be modified.
Seeing the considerable benefits of E-commerce Blockchain, it becomes imperative for businesses to embrace it for achieving expansive growth. The E-commerce marketplace is waiting to be revolutionized by the applications of Blockchain. Although it may take us a little time to witness these implementations change is definitely in the pipeline.
Frequently Asked Questions
Providing tailored solutions based on a wide range of blockchain platforms allows us to meet the unique needs of your project. We specialize in Ethereum, a leading smart contract platform, leveraging Solidity for DApp and smart contract development. Our expertise extends to Ethereum-compatible networks such as Binance Smart Chain, facilitating seamless migration. Hyperledger Fabric, a permissioned blockchain framework, and Go and Node.js are used for enterprise-grade solutions.
Smart contracts are self-executing contracts with code that automates predefined actions when certain conditions are met. With our expertise in decentralized applications (DApps), we can create applications that operate on blockchain networks, offering enhanced security and transparency. Providing a controlled and secure environment for your business operations, we deploy private blockchain networks. In addition, we offer token development, blockchain consulting, and custom consensus mechanisms to meet your specific needs. Our technical proficiency and comprehensive blockchain solutions are poised to meet your unique objectives, whether you want to streamline supply chain operations, enhance data security, or explore the possibilities of blockchain-based applications.
Yes, We specialize in providing tailored blockchain development services tailored to the unique and intricate requirements of your project. Expert blockchain developers create custom solutions that encompass smart contract development, consensus algorithms, and decentralized applications (DApps). Our meticulous alignment of blockchain technology with your specific needs ensures the creation of a bespoke solution that maximizes functionality, security, and scalability. Our team has the expertise to deliver precisely tailored blockchain solutions to meet your technical and business needs, whether you require a private blockchain network, a complex DApp, or the implementation of a custom consensus mechanism.
Blockchain services offer transformative solutions with applicability across various industries. Sectors such as finance benefit from enhanced security and streamlined transactions, while supply chain management gains from traceability and accountability. Healthcare leverages data security, and real estate benefits from transparent transactions. Additionally, logistics, government, energy, and entertainment industries can optimize processes, reduce costs, and improve trust and efficiency through blockchain services, making the technology versatile and impactful across a broad spectrum of fields.
The blockchain services industry encompasses solutions and expertise aimed at leveraging the power of blockchain technology. A blockchain is a distributed ledger that offers transparency, security, and decentralization. With blockchain services, businesses can leverage this technology, resulting in several key benefits:
- Data Security: Blockchain’s cryptographic techniques and decentralized structure enhance data security.
- Transparency and Trust: A public ledger promotes transparency by recording transactions and data. A transparent company builds trust among users, partners, and customers, which is particularly useful in trust-sensitive industries.
- Efficiency and Cost Savings: The blockchain eliminates intermediaries, reducing costs and speeding up processes.
- Decentralized Applications (DApps): Blockchain services can enhance privacy and control over data in decentralized applications. User engagement can be driven by these DApps.
- Efficient Supply Chain Management: Traceability and accountability are enhanced with blockchain in supply chain management. Fraud and errors can be reduced by tracking products.
- Scalability: Blockchain services are designed to scale with your business, ensuring that your system can handle growing transaction loads as your project expands.
I'm founder and CEO of Revinfotech Inc. I traits in leadership and brilliant practitioner in the Financial Services and FinTech. I helped ban in connecting to the FinTech ecosystem through payment acceptance in blockchain as a service and even help i... read more