The Blockchain Trend and How It Will Aid Customer Relationship Marketing
In late 2017 people began to familiarize themselves with the term blockchain, mainly because of the rise in popularity in Bitcoin, a virtual cryptocurrency that relies on blockchain technology. Although most of them where just interested in the rise in price of bitcoin and saw it as an investment opportunity, others (the less greedy people, with a bit higher IQ) were also interested in the underlying concept of it. The real genius of course, is Satoshi Nakamoto. Not only because he is the creator of the bitcoin protocol, but even more because he remained anonymous, sitting pretty with his 1 million bitcoins (although it was probably a group of people who worked under this pseudonym, and I have reason to believe it was the NSA).
But to not get off topic here, lets go back to the core subject.
Firstly, the reason why I think blockchain technology hasn’t really come to fruition yet, while it definitely should have, given the applications and aid it would give us in so many different fields, especially when looking through the lens of Customer Relationship Management. Cryptocurrencies are the reason. Or more specifically the greed that comes with it.
I have been in the crypto space probably longer than most, (I remember thinking how I missed the boat when Bitcoin rose to $1000 for the first time back in 2013) and I can safely say the reason blockchain technology isn’t where it should be is because of the negative connotation that cryptocurrency have brought to it.
People looking to make a quick buck, without even understanding the basics of the coin they invested in, let alone the more complex depth it has. Also the mania that rose in 2017, when the crypto market was flooded with new projects (quasi developers, if even, bringing out totally worthless coin, or as we call in the crypto community, shitcoins) and other, more obvious scams, like bitconnect, where people lost their huge amounts of money, some even their entire lifesavings. Poor people, you would think. Perhaps they were just stupid and too greedy to realize what they were getting into.
The fact that all focus shifted from development to making money, has led to such a delay in real world applications. However, I still think blockchain will be a key contributor to CRM and that it is the technology of the future.
First, lets explain what blockchain actually is.
Like the name indicates, a blockchain is a chain of blocks that store information across the network of personal computers. It is a distributed ledger that is completely open to anyone. The chain of blocks have an interesting property. Once some data has been recorded inside a blockchain, it becomes very difficult to change it. So how does that work?
To understand how it works, we first have to take a closer look at a single block.
Each block contains some data, the hash of the block and the hash of the previous block. The data that is stored inside a block depends on the type of blockchain. For example, the Bitcoin blockchain stores the details about a transaction in here, such as the sender, the receiver and the amount of coins.
A block also has a hash. You can compare the hash of a block to the fingerprint of a human. It is a long string of code and it identifies a block and all of its contents. This string of code is always unique, just like a fingerprint. Once a block is created, its hash is being calculated. Changing something inside the block will cause the hash to change. So in other words, hashes are very useful when you want to detect changes to blocks. If the fingerprint of a block changes, it no longer is the same block.
The third element inside each block is the hash of the previous block. This effectively creates a chain of blocks and it is this technique that makes a blockchain so secure.
The fact it is decentralized, immutable, scalable, secure and by choice can be transparent and permissionless, makes it such a good fit with CRM. Furthermore, blockchain being peer-to-peer based makes it an even more valuable addition in the whole process. It will deliver genuine engagement for brands prepared to invest in long-term customer experience and loyalty. A blockchain will be a safe place to store certified information providing a high-end cloud and scalable industry standard for certified data.
I already mentioned that this new technology can bring so many applications in a wide variety of fields. Paired with CRM, it could be a game changer in fields that are regulated markets, such as healthcare, insurance, utilities/energy, government, supply chain, telco, publishing, and real estate.
These industries tend to have regulated processes performed by operators while interacting with customers. It means that the companies must follow specific steps and certify specific properties as described by country laws or trade unions. Yearly inspections are the norm and the companies must provide evidence that their employees followed exactly the steps as described in some files or that the state of their systems evolved in a particular chronological order. Failure to do so could result in fees, removal of products from the market, and loss of partners. Saving the process data on the blockchain is key since it has military-level anti-tampering security.
Another possible CRM application would be B2C deployments. Blockchain creates distributed, encrypted ledgers that can operate without centralized management and serve as highly trusted repositories for transactions, digital rights, and sensitive data, such as identities and property records.
Transactions can self-execute via smart contracts that eliminate friction and transfer data and value without the participation of traditional intermediaries. CRM systems will be affected by new expectations around data privacy.
Consumers have been required to share personal information and expose themselves to risk through hacks. A blockchain can store and encrypt personal data and confirm details upon inquiry without actually sharing them.
What can we expect from it in the future?
The technology of blockchain will find its way to impact certain aspects in the digital world. If it does, or better maybe said when it does, CRM will certainly be one of the first digital process to use it. As said earlier, there are long ways to go for sure.
Blockchain developments are still in its infant stage. A fully adopted blockchain CRM module for example, may be years away. But I am certain we will se specialized CRM blockchain solutions in the near future.
