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AURA BLOCKCHAIN CONSORTIUM



A Study Of The First Global Luxury Blockchain



LVMH joined forces with Prada and Richemont to design a private blockchain secured by ConsenSys Technology and Microsoft to solve issues such as traceability, sustainability, and authenticity, common to all luxury brands.



Brief:





Conduct independent research on a digital initiative (digital project or product) or digital innovation (a digital technology or service) and share an analysis of the strategic impact of the digital initiative or innovation on the organization, industry, market, economy, and/or society.



One of the main issues that luxury brands face is counterfeiting. In 2020 alone, the U.S. Customs seized $1.3 Billion in counterfeit goods. Since most of the value of luxury goods is in the brand itself, ensuring that the products sold on the market are authentic is essential to preserve the prosperity of luxury brands.


Enter AURA. Born out of an unprecedented collaboration between luxury competitors, Aura Blockchain Consortium represents a single, innovative solution to shared challenges of communicating information on authenticity, responsible sourcing, and sustainability in a secure, digital format. Aura has the ability to track and trace any product with a unique digital identity based on a non-fungible token, with all brands collectively contributing to the blockchain governance and strategy.


Given that issues such as traceability, sustainability, and authenticity are common to all luxury brands, it made sense for these competitors to work together to drive change and develop a shared solution. LVMH joined forces with Prada and Richemont to design a private blockchain secured by ConsenSys technology and Microsoft. Aura is open to all luxury brands and offers flexibility to support companies of varying sizes and adapt to individual needs based on a licensing fee and a fixed fee per product.



When customers make a purchase, they will be given login details to a platform that will provide the history of the product, including its origin, components, environmental and ethical information, proof of ownership, a warranty and care instructions. Aura Blockchain matches a product ID to a client ID, providing the infrastructure – through a chain of secure, non-reproducible, digital blocks – to enable consumers to access the history of a product and proof of its authenticity at every step of the value chain, from raw materials to point of sale, and even more. Consumers can thus follow the entire lifecycle of a product with trusted data throughout, and with no need for third-party verification.



Brands using Aura can develop their own experience according to their specificities and customer expectations. They can also maintain their own data and adhere to the strictest standards of client privacy, with information stored on the blockchain in a way that cannot be changed, tampered with, or hacked.


The Aura Blockchain Consortium makes it possible for consumers to access product history and proof of authenticity of luxury goods. From sourcing to sales, all the way to second-hand markets, each product is given a unique digital code during the manufacturing process that will be recorded on the Aura ledger. This extended transparency allows brands to strengthen their relationships with their clients and enables customers to access new services provided by the brands.


AURA has been specifically developed by luxury brands, for luxury brands, offering a wide range of services specific to this industry. Considering that the technology is open even for independent and premium brands, Aura will create value for the entire luxury sector. Small designer brands with limited financial means have a harder time fighting fake and the illicit trafficking of counterfeits; thus, Aura represents a convenient and affordable solution.




As the consortium grows, so will its capabilities. A tech roadmap is in the works for customizable features requested by partnering brands. Through every step of the chain, track and trace capabilities are being developed along with robust experimentations using digital garments and NFTs. Envisioning a greener world, the consortium also hopes to adopt more sustainable practices such as energy efficiency and ensure that every element of the entire luxury sector is protected and benefits from this new eco-system.


This ecosystem is expected to flourish and as it creates a market force of its own, it’s important to know how to grow sustainably. While internally the blockchain will generate transparency, Aura should explore ways to enable communication between multiple external systems that might also house comparable products and exchange vital information for the benefit of the end consumers. Given the benefits of a decentralized public model, Aura might also consider exploring a hybrid system where it can relinquish control over some aspects of its model to allow for newer innovations to occur from external sources.


Some of the predictions for the next steps of this technology are the acceptance of cryptocurrency, a technology also built off the backend of blockchain. As more and more conglomerates participate in this initiative, Aura stands to be in a position to establish industry standards. Smart technologies, embedded chips, and alternative energy sources all are potential areas that Aura will eventually adopt and evolve into the upgraded version of tomorrow.


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