Prada, Cartier and Louis Vuitton Create Global Luxury Blockchain to Combat Counterfeits

A trio of high-end luxury designers joined forces to combat counterfeit goods through the use of a single global blockchain solution to verify goods.

LVMH, Prada Group and Cartier, part of Richemont, have collaborated to develop a single approach to try and solve the complexities of sharing credibility, ethical procurement, and sustainability in a safe digital format.

The Aura Blockchain Consortium’s technology allows access to product history and evidence of authenticity for consumers. Consumers may track a product’s lifecycle from conception to delivery, as a means to certify the legitimacy of the product.

The counterfeit goods market takes a significant chunk from these luxury brands bottom line, with The Global Brand Counterfeiting Report 2018 estimating that the losses suffered due to online counterfeiting globally amounted to US$323 billion (A$414 billion) in the year 2017.

The luxury industry has fought hard to combat counterfeit goods in recent years, it has even been reported that LVMH has at least 60 attorneys and spends US$17 million (A$21 million) on anti-counterfeiting litigation per year.

“The Aura Consortium represents unprecedented cooperation in the luxury industry. Blockchain is a key technology to enhance customer service, relationship with partners and traceability,” Cartier International president and CEO Cyrille Vigneron said.

“The luxury industry creates timeless pieces, and must ensure that these rigorous standards will endure and remain in trustworthy hands.”

Bulgari, Cartier, Hublot, Louis Vuitton and Prada are already active on the platform and the consortium claimed to be in advanced conversations with brands both within founder groups and independent brands, in relation to joining the consortium.

ConsenSys technologies and Microsoft protect the technical infrastructure, which is a multi-nodal private blockchain. It will protect the information in non-reproducible details and create a one-of-a-kind certificate for its user. 

“The Aura Blockchain Consortium is a great opportunity for our sector to strengthen our connection with customers by offering them simple solutions to get to know our products better,” LVMH managing director Toni Belloni said.

“By joining forces with other luxury brands on this project, we are leading the way on transparency and traceability. I hope other prestigious players will join our alliance.”

The companies are also hoping to verify sustainability within product ranges through the blockchain, which is increasingly becoming an important selling point for luxury brands.

Lorenzo Bertelli, Prada Group head of marketing and head of corporate social responsibility said the blockchain will add major value to consumers “through a sustainable authentication system which will unlock future possibilities”.

A 2015 report from Neilson found one in three Millennials would pay more for sustainable products, with 72 per cent of Generation Z in the same mindset.

According to Bain & Co, Millennial customers accounted for 35 per cent of consumption in the luxury goods market in 2019 and by 2025 could make up 45 per cent of the market.

Generation Z only represents four per cent of the market right now, but by 2035 Bain & Co estimate that share might reach 40 per cent.

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