The Impact Of Emerging Technologies Like Blockchain On E-Commerce

In recent years, the popularity of online shopping and eCommerce has revolutionized the way we buy and sell products. Every other company in the eCommerce space is seeing overwhelming growth that has transformed the way we transact online.

With this rise in popularity, emerging technologies like blockchain are also gaining momentum in the eCommerce industry. Blockchain enables easy processing, verification, and securing online transactions while providing transparency and efficiency.

In this article, we will explore the impact of emerging technologies like blockchain on eCommerce and how it is changing the way we conduct online transactions. But first, let’s understand what blockchain is and how we can use it for eCommerce:

What is Blockchain and How Can We Use it for eCommerce?

Blockchain is one of the huge tech innovations of recent times and is majorly utilized for the permanent, immutable, and transparent keeping of data and transactions. Consider it as a distributed database or a digital ledger that is decentralized in nature.

Blockchain works on three central pillars:

  • It should be cryptographically secure
  • It should have a digital log
  • It should be a database that’s shared across public and private networks.

Since blockchain is a distributed database, it’s maintained by a network of nodes or computers that validate and record transactions in real-time. Here, the data is stored in blocks that are linked together in chronological order, which forms a tamper-proof chain of information.

Each block in the blockchain contains a unique cryptographic hash that verifies the content, making it theoretically impossible to alter or delete data. Blockchain can be used for creating a decentralized database to store product and sensitive customer information like credit card details.

ECommerce website development companies can use blockchain to provide a secure and efficient way to transact online. Blockchain-enabled payment systems can also reduce the risk of payment failure and prevent fraud.

Further, by using blockchain in eCommerce, companies can improve their user experience. Thanks to blockchain, customers can easily track their purchase history, orders, and transactions, which streamlines the whole process.

How Blockchain Impacts the eCommerce Industry?

Now that we know what blockchain is and how it can be used for eCommerce, let’s understand its impact on the industry:

1. Decentralized Marketplaces

One of the most exciting benefits of blockchain is to use it for creating decentralized eCommerce marketplaces. Such marketplaces will allow buyers and sellers to control the systems and transact without any central authorities like payment processors or banks.

Such capabilities in the eCommerce platform are possible thanks to smart contracts. They are an integral part of the blockchain and are self-executing agreements that automatically get executed when the preset conditions are met.

As a result of this, customers and eCommerce businesses can connect directly without any restrictions or regulations.

2. Improves Supply Chain Management

Blockchain technology can help improve supply chain management in e-commerce in the following ways:

  • Blockchain will provide increased transparency for every transaction in the supply chain. It can identify and resolve issues in the supply chain, leading to the faster and more efficient movement of goods to end consumers.
  • It enables the tracking of goods from the origin to the final destination, allowing greater accountability and traceability.
  • Smart contracts can automate and streamline supply chain processes, reducing the time and costs associated with manual processing.

3. Revamp Payment Systems and Prevent Fraud

Blockchain is primarily used as a host for cryptocurrencies which are now becoming mainstream and are replacing traditional currencies. Since the base technology behind cryptocurrencies is decentralized, buyers and sellers have control over transactions and operations.

Therefore, no one can manipulate transactions or devalue or inflate currencies. Although the transactions are transparent and stored in a centralized ledger, they don’t reveal the identities of anyone. Moreover, blockchain can help prevent payment fraud and protect customers’ data. 

Even though eCommerce systems are designed to do so, fraudsters can create fraudulent transactions to steal money and information. Blockchain can play a key role in defending such eCommerce fraud by creating a tamper-proof record of transactions. This will ensure that transactions in the blockchain ledger are legal and accountable.

4. Faster eCommerce Checkout

Blockchain ledgers used for storing customers’ payment details help speed up the checkout process. The technology’s tamper-proof ability helps retailers eliminate the need for customers to provide their data like address or payment info during checkout. This will help them save time and checkout faster without any hassle.

With blockchain integration, buyers and sellers can complete transactions directly, without the need for intermediaries. This’ll effectively eliminate the multistep checkout and reduce the time taken for the transaction to complete, while also minimizing the cart abandonment rate.

Additionally, eCommerce payments through digital currencies are processed at a much higher rate, reducing the time and costs associated with traditional payments.

5. Streamlined Inventory Management

The decentralized database system could come in really handy for inventory management as it can track items throughout the supply chain from production to purchase. Businesses can use blockchain to create an immutable record of every product in their inventory which provides greater transparency and traceability.

Moreover, the decentralized nature of blockchain will help track inventory on multiple systems to prevent data silos. One of the biggest advantages of using blockchain for inventory management is minimizing errors and inaccuracies.

Since data is distributed and stored in an immutable way, there’s no single point of failure for data to get corrupted or lost. Thanks to such benefits, many businesses seek out this new innovative tech to streamline their inventory management.

Final Words

Emerging technologies like blockchain are surely transforming the way eCommerce proceeds. From supply chain to payment processing and inventory management, blockchain can bring forth a revolution in the industry.

Moreover, eCommerce companies can improve their operations, reduce costs, and provide a better customer experience using blockchain. They can leverage the decentralized platform, smart contracts, and other blockchain features, to streamline their processes, reduce risk, and increase trust in the marketplace.

And as blockchain technology evolves, we can expect more innovation in eCommerce and beyond. But in summary, blockchain is a game-changing technology that is set to transform the eCommerce industry in a big way.


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