Opinion: How Can Blockchain Revive a Dying Business?

May 31, 2018 · 4 min read

The use of blockchain technologies can positively affect the capitalization of the future technological startup. However, there are also examples where the blockchain has revived a practically dying business, which is quite far from the blockchain industry and IT projects. The most important thing for them is to properly raise a hype wave. Specialists of the European fintech company, Wordcore, prepared a selection of the most interesting stories of unexpected success when traditional companies used blockchain-hype to increase their capitalization.

Long Island Iced Tea Corp. (NASDAQ: LBCC) — a small American producer of soft drinks at the end of last year changed its name to Long Blockchain Corp. After announcing these changes, the company’s shares soared by 500% the same day, having gone down to 200% afterwards.

“There is nothing surprising in this, a usual successful marketing move that draws attention to an unremarkable company,” comments Alexey Nasonov, head of Wordcore. “People tend to associate the success factors of a company with the name or location of the office — this is a typical logical associative error, well used by PR managers”.

The expert also notes that this is not a single case. A small Chinese juices producer SkyPeople Fruit Juice, which last summer changed its name to the Future FinTech Group (NASDAQ: FTFT), and started investing to justify changing its name. The regulator threatened this company with delisting on the stock exchange, as the changes allegedly deceived investors. Worldcore expert is sure that the story of the “blockchain tea” producer will end exactly the same.

The giant of the photo-industry Eastman Kodak Co (NASDAQ: KODK) announced its own KODAKCoin token on KODAKOne blockchain-platform, designed with the help of WENN Digital. The platform was created to control the use of copyright in photography and digital pictures, as well as the licensing system for their use, including a distributed royalty collection system. After such announcements, the company’s shares soared by 350%, going down with the announcement of a delay in the release of the platform. “I believe Kodak is almost a single serious example of integration of the blockchain into the classic business that is going through hard times,” hopes Alexei Nasonov. Unlike the changes in names, the Kodak-Wenn alliance has every chance of success”.

The largest brand of the photo-industry in the past, the highly demanded topic of using and protecting copyrights in photo and video materials, Ethereum blockchain, and most importantly, the placement of ICO in the format of SAFT (Simple Agreement For Future Tokens) , which makes it extremely easy to purchase tokens by American citizens in the financial market of the United States. All these conditions open a lot of prospects for the project.

A well-known brand of the gaming industry ATARI (ATA: FP) — the creator of the legendary PacMan and SpaceInvaders, decided to link the brand concept of openness to its gamer consumers with the blockchain industry. To do this, the gaming giant of the 80’s entered into an alliance with Infinity Networks and the online casino PariRlay for the release of Atari and Pong tokens, which can be earned and spent both in the gaming and in the real world: to buy software and play casino games. Announcement of plans of cryptocurrency integration brought more than 100% increase in the company’s capitalization in early 2018.

“If we don’t take into account the success story of the Atari 2600 and the subsequent failures of the company,”- tells Alexei Nasonov, — “in today’s realities of raising the attractiveness of everything connected with cryptocurrency and blockchain, the company will be able to get additional investments to implement an interesting investment strategy. Integration of the online and offline gaming world and the possibility for gamers to participate in the crowdsale of gaming and media projects under the Atari brand is a very cool idea — by buying their tokens, gamers can spend them on goods and services of the Atari virtual world!”- notes Worldcore CEO.

However, in different countries, there are examples of simply successful marketing moves used by everyone — from hotels to restaurants, — to somehow associate themselves with the fashionable topic of blockchain and crypto-world. Russian example: a network of restaurants of Japanese and European cuisine “Dve palochki” (“Two sticks”). Last autumn, the chain of restaurants present in Moscow and St. Petersburg “Dve palochki” (“Two sticks”) also “participated in the ICO, although in a somewhat unexpected way.

Some restaurants of the network started offering ICO of branded mulled wine, in which the brand-manager of the network offered to “invest” the tokens, equated to ruble in 1:1 ratio for simplicity. The company does not disclose the results of sales, but for the blockchain community, the choice of a soft drink in the hot season is obvious. At the end of August 2017, Burger King network also announced the creation of a Whoppercoin. Further promises, of course, were not realized, but the company received great attention. In January 2018, the American company Chanticleer Holding, which owns brands such as BGR (Burgers Grilled Right), Little Big Burger and American Burger, announced that it will use the MobivityMind platform to reward customers with currency that can be used in all Chanticleer Holding outlets.

“Such marketing campaigns are rather situational and affect only the general popularization of cryptocurrencies and blockchain on a larger scale. Which is also good,” — concluded Alexei Nasonov.