April 21, 2022
A recent article in fast business envisions a world in which products can tell customers anything and everything about themselves using a digital ID, readable via a QR code or NFC tag that contains information about where the product has been and lasts as long as the product.
The technology is growing as customers seem to be more aware of where the products they buy are coming from.
Assigning digital IDs to products in every category, from jackets to t-shirts to furniture, could lead to the birth of new customer services and business models, according to Natasha Franck, founder and CEO of the connected products company EON, quoted in the fast business article. In categories like fashion, Franck sees digital IDs enabling retailers to make it easier to order, style, service, repair and resell, monetizing at every stage of a given product’s lifecycle.
Similar technology is already being rolled out in grocery stores. Recently, the global grocery chain Crossroads became the first grocer to use blockchain to provide additional information about its organic products in-store via a QR code. Scanning a QR code informs customers about the origin of the product and its journey, its level of quality and its organic certification.
Questions remain as to the extent to which customers would actually use or benefit from this degree of granular information. While many American companies have taken steps to raise their profile for sustainable and ethical production — and promoted themselves accordingly — there are examples of companies thriving while doing the exact opposite.
For example, despite its notorious lack of supply chain transparency and sustainability initiatives, Chinese marketplace Shein remains at the top of the fast fashion world according to High Snobity. The direct warehouse market has generated $15.7 billion in sales and is pursuing a valuation of $100 billion.
Privacy could also become an issue if brands attached a digital ID to each product and tracked metrics about them. Customers may be uncomfortable with the idea of personal data being collected about them and appended to products they intend to resell later, and such data could theoretically be used in a detrimental way by new second-hand product owners.
DISCUSSION QUESTIONS: Do you see digital IDs being required for all products and, if so, what type of information do customers expect from them? Will privacy issues and other inconveniences prevent the use of this technology for reuse purposes?
“Privacy could be an issue until laws catch up to prevent abuse. But the benefits far outweigh any risks or concerns.”