“Aura”, the consortium initiated by LVMH and bringing together Prada, Cartier and OTB Group, continues to put its pawns in the “Web3”. This blockchain product authentication solution announced at the end of last month that it was integrating the solution developed by the diamond company Sarine Technologies. The goal ? Guarantee authenticity and respect for ethical principles in the design of their diamonds, through their traceability throughout the supply chain.
Because LVMH and its main competitors decided, in April 2021, to join forces in order to make the most of Blockchain technologies. Since then, Aura Consortium Blockchain has created a digital identity for almost ten million luxury products, mainly Non Fungible Token (NFT). But how to explain the reasons for this shift towards Internet 3.0 of the world leader in luxury? Why is Bernard Arnault’s group, best known for its champagnes and high-end leather goods, so interested in Blockchain and NFT?
Offer customers new guarantees of quality and new experiences
LVMH and its partners first wish to benefit from the commercial guarantees provided by Blockchain technologies. In a sector plagued by counterfeits, the Blockchain allows brands to enhance their credibility by certifying the authenticity of their products. For example, Prada has decided to list all its products on the Aura platform by equipping them with NFC and radio-identification (RFID) technologies.
Tinder wants to end Google’s payment monopoly
The blockchain also serves the market for the resale of luxury items – whose brands have now fully integrated virtuous logic – by allowing customers to access a database listing all the information relating to the maintenance of the objects they they acquire. This is notably the choice made by Cartier when it comes to its watches and jewelry.
In addition, brands investing in Aura intend to attract new audiences sensitive to “3.0” technologies, young and connected. It is a tool capable of “generate new revenues through attractiveness effect”, recently explained the CEO of the Italian group OTB, owner of the Diesel, Maison Margiela and Marni brands. Aura, for example, has developed a solution allowing brands to offer their customers gifts in the form of NFTs, which are perfect reproductions, in digital format, of the physical products”said Daniela Ott, the general secretary of the consortium, last month.
Last but not least, the luxury giants seem to be betting, not without risk, on investing massively in a sector undergoing rapid industrialization. The objective being ultimately to enjoy a competitive advantage when in the future, the Blockchain will have reached maturity in the business world.
The Metaverse of luxury, between promises and uncertainties
In its “Web3” strategy, LVMH is also exploring the possibilities offered by the Metaverse. And this, “very carefully”, recently declared the financial director of the French group, Jean-Jacques Guiony.
Through investment in the Metaverse, it is above all a question for brands of improving their storytelling by immersing customers in a virtual experience capable of building loyalty. According to several sources, LVMH would work in particular on virtual tours of its leather goods workshops, as well as on digital fashion shows during which it will be possible to acquire NFTs in preview. The French group also plans to quickly recruit, within it, an “NFT and Metaverse manager”, entrusted last month its director of information services to Forbes magazine, Franck Le Moal.
For the time being, however, the luxury giants are investing in the Metaverse with moderation, anxious both to patiently explore a world with vague outlines, and to guard against financial disasters linked to the bursting of a possible speculative bubble. Without denying the opportunities offered by the Metaverse, the boss of LVMH, Bernard Arnault, did not fail to underline the risks, recalling the bursting of the Internet bubble at the beginning of the year 2000. And to underline that to date, LVMH is above all very present… “in the real world”.