How To Leverage the Blockchain and Grow Your Business

Now is the time for strategically forward thinking companies to have a blockchain strategy in place. While many are familiar with “Bitcoin” and have some understanding of cryptocurrency, very few decision makers responsible for crafting and setting corporate strategy are knowledged on the basic fundamentals of “The Blockchain”. This is the first in a series of articles on why businesses should, and how businesses can, formulate a blockchain strategy.

Understanding the Blockchain

The blockchain is the underlying technology of all cryptocurrency. The blockchain is very technical at its core, but simply put it’s a way for digital information to be stored and distributed, but not copied. At its most basic, blockchain is a kind of ledger that will record and time-stamp every transaction and online interaction between one party and another. This is why it’s commonly suggested to view the blockchain as a public ledger, but one that everyone can see and is shared amongst all its users. Since this digital ledger is recorded on everyone’s computer world-wide it becomes decentralized and everyone using the blockchain keep the digital ledger up to date. It’s stored in a chain-like configuration, where the transaction history in ‘blocks’ and can only be built upon, not changed.

So in summing up, the blockchain is a continuously growing list of records or blocks, added securely to a time-stamped ledger, which is the chain. Since the blockchain has blocks of identical information that’s stored across its network, it can’t be controlled by any one person and has no single point of failure. We call this “decentralized” and it not only makes it harder to crack an individual account, but it also makes it much harder to bring down an entire network. The Blockchain’s strength in security is in large part due to its decentralized data storage structure and is exactly why blockchain has played such a big role with cryptocurrencies. For a hacker to access the data, they would have to hack into every place where the data is kept.

Blockchain technology uses math to determine who owns what, when, resulting in secure identity, transaction, and property confirmations. And since blockchains are decentralized networks, layers of middlemen are replaced with encryption, algorithms, legal and financial apps, and smart contracts. (more on this later). For businesses, by cutting out middlemen and and layers of intermediaries, blockchains take you straight to the customer. All provisions for, and information exchanges with, customers can be safeguarded, tracked, and monetized through a whole supply chain. The blockchain can turn your brand into a network, your customers into prosumers (product and brand advocates), and your business into a community. It can also enable cooperation with other companies that facilitate in serving your clients like transportation/shipping companies, etc.

Blockchain technology is now affecting a range of industries, and it can help brands reach their consumers more directly and with more authenticity. The decentralized, peer-to-peer model brings the customer into equal, direct back and forth communications with businesses, and lets customers generate monetized marketing content for their favorite brands through that engagement.

Thus what makes blockchain groundbreaking for the marketer is that every transaction recorded in the blockchain will be linked with the other transactions around it (all the transactions in this thread make up the “block”), and this will provide you with a more definitive view of the customer.

Here are some businesses who are currently investing in blockchain technology:

• Microsoft is building a decentralized ID system on top of blockchain technology similar to Bitcoin, Ethereum, and Litecoin, and they’re supporting it through their Authenticator app. Microsoft is also offering blockchain storage for banks, healthcare, and ledger startups.
• Online colossus Amazon, through a collaboration between Digital Currency Group (DCG) and their own Amazon Web Services, are providing their own BaaS to tech-based companies like financial organizations and insurance agencies.
• Not to be excluded, IBM also has a BaaS platform designed to streamline operations for companies with a lot of e-commerce transactions.
• Blockchain has immediate impact on supply chain management, and companies like Walmart and IBM have already applied the technology to their own inventory replenishment programs. This is particularly advantageous for grocery chains who can significantly reduce the amount of food that’s wasted (for more on how the leaders in AI can solve supply chain management challenges, check out “Using AI for Marketing: How Machines Optimize Decision-Making”). The next part of this series will focus on how businesses can deploy “marketing” within the blockchain.

At Element Zero, we’re building a platform for businesses to develop, customer and launch their own stablecoin. We believe that every business has worked hard for their customers and that there’s little value to a business handing that relationship over to a third party to conduct (and profit from) payments. Instead, we believe in placing the tools into businesses hands that allow them to deepen and strengthen their customer relationship. Personally, as a marketer with a deep interest in customer loyalty and retention, the blockchain presents so many opportunities to develop a better experience for brands and businesses to deliver value to their customers, I’m excited to watch this industry continue to develop and build truly awesome customer experiences.