Ecommerce’s next wave, part 4 of 4: Secoo
By Edward W. Mandel
“Follow the money.”
That’s sage, old advice for trend pickers, and particularly important to those of us today who are involved in distributed ledger technology. The carriage trade has caught up to this radical innovation, and at least one high-end e-tailer has fully embraced blockchain.
IOU.iois quite deliberately a blockchain-native ecommerce platform. So we take heart that our technological strategy is sound when a famous, high-end site that was established on the old internet adopts the processes we’ve been championing in our white paper.
Top of the market
I’m talking about Secoo, “Asia’s largest online integrated upscale products and services platform as measured by GMV in 2016 with higher average sales per order than other major e-commerce online platforms in Asia,” according to its investor relations materials. “Since our inception in 2011, we have attracted a large and loyal customer base with high purchasing power and an increasing propensity to purchase luxury products and services on online platforms with diversified and personalized demand.”
Essentially the company is run by rich people selling to other rich people, and rich people don’t do anything they don’t want to do.
So why do they want to do blockchain?
The answer is simple: to get even richer.
Playing with blocks
Secoo isn’t expecting to boost sales with blockchain, but it does seem to have dedicated a great deal of thought to how to go about reducing costs — and their ideas are not always what you’d expect.
The Beijing-based company’s initial use case is anti-counterfeiting. In this case, counterfeiting refers to misrepresented merchandise, not misrepresented funds. Blockchain technology provides a failsafe to ensure consistency of product name, color, size and other authentication data.
“Relying on the blockchain technology, decentralization, non-modification and traceability, products will have a unique identification with multiple anti-counterfeiting inspection information,” Secoo says in a press release.
Even so, counterfeiting works both ways, and I’d encourage Secoo to use these same capabilities to make sure that the cash coming in through its revenue stream is valid.
Go back to 2008’s “Bitcoin: A Peer-to-Peer Electronic Cash System,”a.k.a. the Satoshi white paper, the crypto space’s founding manifesto. Our pseudonymous patron daemon calls the exchange of digital coins on a distributed network “a solution to the double-spending problem using a peer-to-peer distributed timestamp server to generate computational proof of the chronological order of transactions.”
That’s right out of the introduction — coins (“token” appears nowhere in that work) are intended as a prophylactic against counterfeiting of funds along the electronic frontier.
We’ll see if Secoo takes my advice. It’s ultimately the call of the perfectly named Champion Ren, the company’s “CGO,” whatever that is. (Chief growth officer? Glitz? Genius? Goof-off?)
“Secoo is the first company to launch luxury blockchain in the industry,” he said in a statement. “As a precursor, Secoo has many advantages, such as physical offline experience centers, warehouses and strong partnerships. In the future, Secoo will also help partners to open the commodity information upload and traceability privileges.”
He is the Champion, my friend. Mr. Ren is the Secoo executive who serves as the company’s blockchain evangelist.
Just hype?
Ren might have just been playing the market when Secoo made the announcement in January 2018 that it was adopting blockchain technology. Certainly, the comments played straight into the top of the bitcoin bubble. As you’d anticipate, its stock price shot up as soon as they put out a press release with “blockchain” in it and, just as expectedly, it settled back down over the course of cryptocurrencies’ bear market.
And certainly, these two things correlate and it’s not going too far out on the limb to assert a causal link. BTC tanked and SECO declined.
But the stock didn’t lose three-quarters of its value like the digital asset did. It just regressed to its mean. And it’s important to note that Secoo’s announcement didn’t say a word about “crypto” or “ICO” or anything that appealed to amateur-hour speculators. It just stated that this was a new technology that would help with inventory control. SECO’s less-than-stellar performance since its September 2017 Nasdaq debut has more to do with lousy timing — launching into a trade war — than with its IT architecture choices.
And that’s our approach here atIOU.io. Yes, we suggest you get whitelisted for IOUX coinsfor their utility value, but we’re much more interested in what these utility tokens enable you to do than with how much we think you might be able to sell them for someday. We’re all about creating an environment in which the marketplace — not the banks, not quasi-governmental monetary authorities, not rating agencies — determines your creditworthiness. It’ll also be a place where you continue to own all your own data, sharing only what you feel comfortable providing so that the community can serve your needs more precisely.
Someday, maybe that’ll be just the normal way we all do business but, for now, I’m really excited to be here as this new paradigm comes into focus.
Edward W. Mandel is a strategic advisor for IOU.io , he is an Ernst and Young Entrepreneur of the Year Finalist, Blockchain Enthusiast and visionary behind many successful organizations. An avid entrepreneur, Edward has a knack for designing distinctive business models complemented with superior technology to deliver unparalleled service and profitability. Edward also has been advising and consulting for various successful Blockchain technology and ICO projects and recently launched his own BQT.io P2P Hedge Exchange helping traders connect with each other to leverage their crypto assets.
IOU is a blockchain-based peer-to-peer platform designed to unify ecommerce transaction and customer retention processes, incorporating trade-able IOUs. The platform can be found online at IOU.io and its community on Telegram at https://t.me/IOUCommunity.
