French fashion powerhouse LVMH is working with Microsoft to incorporate blockchain into their luxury brands, which include Louis Vuitton, Hublot, Celine, Givenchy, and Christian Dior.
This isn’t LVMH’s first foray into new technology, though – it recently experimented with foldable screens as a form of wearables in their Cruise 2020 line.
Their new AURA platform is the product of Microsoft’s Azure cloud computing system and ConsenSys, the design studio behind ethereum; the project has apparently been underway for about a year.
LVMH has seen the future of fashion, and it is artificial intelligence. https://t.co/djpAUrYsAI— The Business of Fashion (@BoF) May 19, 2019
Blockchain is a decentralised ledger system that creates accountable, transparent records (blocks) that can be verified for authenticity. Its most popular use so far has been in cryptocurrency, although more companies are figuring out ways to use blockchain in various product life cycles (including Starbucks, Cathay Pacific, IBM, and more).
This week ConsenSys formally announced AURA a blockchain network to enable consumers to trace the history and authenticity of luxury goods developed in partnership with LVMH and Microsoft. #blockchain https://t.co/lIRprNaGhN— Carlo Purassanta (@purassan) May 18, 2019
Some of blockchain’s corporate applications fall into a “just because we can, doesn’t mean we should” category. The basic idea behind blockchain isn’t new: at the end of the day, it’s just a smart, fancy crypto ledger system. But it makes sense for LVMH, which produces expensive luxury fashion goods that many consider to be status symbols across the world.
Interestingly, LVMH will be opening up their new toy to competitors, who can become a shareholder of AURA. This isn’t the first time that expensive goods have looked to technology for answers, either – Arianee is another blockchain startup that styles itself as a “digital identity” standard for high-worth items.
High fashion (especially in Europe) has always struggled with counterfeiting problems. However, introducing blockchain seems like an over-complicated way for LVMH’s existing customer base to prove that their new Givenchy dress is real; people who still buy affordable fakes will probably still… well, buy affordable fakes. The consequence of having a good fake purse is still the same: getting caught with it by relevant authorities. Otherwise, who cares?
LVMH will roll out blockchain to Louis Vuitton and Parfums Christian Dior either this month or next before applying it to its sizeable roster of other luxury brands.