1st October 2019
Blockchain Technology & What it Means for the Future
are becoming less trusting of the products and brands that they purchase. This
is something that is being driven by several factors. However ultimately, these
factors can be grouped together, with consumers feeling that brands and products
are often driven more by corporate greed rather than having the best interests
of the consumer at heart. This is something that has intensified over the last
decade in a post-recessionary environment, with consumers who are juggling and
struggling with their finances seeing major stories about the policies and
practices of brands that can be deemed misleading.
products and brands need to look for ways to help maximize consumer trust. The
growing introduction of blockchain technology within the food, drink and
supplement industry is one way of helping achieve this. However, it also needs
to be taken into consideration that challenges exist when it comes to the
introduction of such blockchain technology.
What is Blockchain
In Q3 2019,
FMCG Gurus interviewed 26,000 consumers across twenty-six countries on the
topic of trust, sustainability and blockchain technology. The research shows
that being able to trust brands is important to consumers in the food (60%),
drinks (56%) and nutritional supplement (64%) industries. This is because trust
is associated with several favorable product attributes such as better quality
(49%) and health (45%). It is also worth noting that 45% of consumers believe
it is important that brands and products elicit trust by highlighting their
ethical and environmental initiatives, even if they do not necessarily feel
anything is wrong with product or brands.
whilst trust is important to consumers, only one in two consumers say that they
are generally trusting of food brands (51%), drink brands (49%) and nutritional
supplement brands (50%). Moreover, one in four consumers across the globe say
that they have become less trusting of food brands (26%), drink brands (26%)
and nutritional supplement brands (23%) over the last two years. When
questioned why they are not trusting of products and brands, the most popular
answer given (42%) is that consumers feel that products and brands are more
interested in profit than corporate and social responsibility.
decades, there have been several scandals that have hit the food, drink and
supplement industry that have had a severe impact on overall levels of consumer
trust. Such scandals have ranged from scares around ingredients being used in
food and drink products, to consumers feeling that brands making misleading
claims around health and the environment in order to charge a premium price. In
addition to this, consumers can also feel that brands and manufacturers charge
unnecessarily high prices. This is something that is an irritant to consumers
at a time when they are struggling with their everyday finances.
needs to be remembered that in an age of information, consumers can often post
such negative sentiment on social media channels, meaning irrespective of the
accuracy of such complaints, such negative sentiment can often be communicated
to lots of people.
As a result of this, consumers want brands and products to demonstrate maximum transparency when it comes to practices and policies. This is important at a time when 49% of consumers say that they regularly conduct research on the products and brands that they buy. Moreover, consumers expect brands and products to adopt a holistic approach to trust and transparency. Indeed, 50% of consumers, for example, say that it is not enough for brands and products to monitor their own supply chains to ensure social and corporate responsibility. Instead, they also need to monitor the supply chains of their suppliers. This can be related to stories around brands promoting their ethical and environmental credentials, only for it to be unwittingly revealed to them that the ethical credentials of suppliers are in question.
One of the
challenges that brands and products have when it comes to promoting trust and
transparency is that consumers are more skeptical towards big brands than ever
before. As such, new ways need to be found to help elicit consumer trust.
research shows that currently, only 17% of consumers say that they have heard
of the concept of blockchain technology. Of these consumers, only 31% say that
they have heard of blockchain technology being used in the food and drink
industry. However, when given an explanation as to what blockchain technology
is, a total of 49% say that such technology is appealing. This shows that
whilst blockchain is currently something of a niche within the food, drink and
supplement industry, it is something that has the potential for large growth.
comes to blockchain technology, half of all consumers (51%) say that they would
be likely to use such technology. When asked, consumers admit they are more
likely to use such technology for some of the products they buy (35%) as
opposed to all the products that they buy. On a category-by-category basis,
consumers are most likely to say they would use blockchain technology for
researching the coffee sector. This is a sector where ethical and environmental
considerations is something of a hot topic. In comparison, consumers are least
likely to say they would use the technology to find out more about the
nutritional supplement industry (19%).
also asked consumers what type of information they would be most likely to
research. The research shows that overall, consumers are most likely to check
the carbon footprint of products and brands (60%). CO2 emission is a major
concern for consumers because of the link with issues such as more
unpredictable weather patterns and global warming. It is even resulting in
consumers making fundamental changes to their diets, such as attempting to
reduce meat intake. As a result of this, blockchain technology is a
particularly useful tool for promoting incentives such as local production and
reduced supply chains.
positive sentiment that exists towards blockchain technology, it is important
to recognize that barriers exist to the use of technology. For instance, a
total of 21% of consumers believe that storing such information on a database
is negative. This can be related to consumers feeling that information could
still be altered or manipulated so that it is not totally factual.
To conclude, consumers currently demonstrate a high level of skepticism and distrust towards brands. This trust is also something that is deteriorating and can be linked to concerns around practices and policies of brands and products when it comes to the environment, health and pricing. As such, increasingly skeptical consumers want brands to take a holistic approach to demonstrate trust along the whole of the supply chain. Although relatively unknown, blockchain technology is a keyway of doing this, particularly as a high proportion of consumers say they would use such technology. However, despite high levels of appeal, challenges do exist towards blockchain technology. This means that products and brands would need to communicate information in a transparent and effective manner about how information is stored – and offer proof of such information when required.
To learn more about our blockchain surveys please click here.