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Rising Resale Market Spurs Tie-Ups in Product Authentication Tech

Apparel retailers stand to lose millions in sales due to counterfeit products posted on third-party marketplaces or on resale sites, underscoring the urgency of ensuring product authenticity to foster brand trust and prevent lost sales.

In an effort to deliver digital proof of authenticity and end-to-end traceability throughout an entire product journey, Internet of Things (IoT) software company Evrythng has partnered with Arianee, a blockchain platform designed to authenticate branded products by issuing digital certificates.

Evrythng assigns a digital identity to physical objects using QR codes, NFC, RFID and other solutions, and will combine that with Arianee’s blockchain technology, enabling apparel and luxury retailers to gain visibility into a product from the factory to the consumer and even to secondhand and resale markets. The blockchain technology will enable brands to transfer identification to new product owners with verification of authenticity.

Premium brand owners can now analyze metrics such as the rate at which a customer resells their purchases, and also anonymously connect with customers buying goods from resale platforms.

Given that resale is a potential $50 billion market, according to 2019 ThredUp’s resale report, the growth of secondhand retail is going to require stricter authentication processes. While companies that have recently debuted authentication programs, such as Mercari or Rebag, haven’t turned to blockchain technology to improve the process, that could change as in-house authentication efforts come under scrutiny.

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“As the premium apparel and luxury resale markets continue to grow and counterfeit culture persists, the ability to verify quickly and easily that a product is authentic is becoming a necessity for any premium brand,” said Niall Murphy, CEO and co-founder of Evrythng. “To date, the lack of item-level traceability of products through the supply chain has posed a serious challenge. Our partnership with Arianee changes this paradigm, giving brands and their customers a quick and easy way to verify that a product is authentic with a globally scalable traceability solution.”

Evrythng built Product Cloud, which monitors each product by gathering data from sourcing and manufacturing through to retail, and even recycling or reuse. Users can track and trace, from anywhere between batches and pallets to items, case and raw materials. Within the platform, users can manage product recalls with consumer alerts via connected packs and locate products in market using crowdsourced consumer data. Some of its customers include Ralph Lauren, Puma and Carrefour.

Evyrthng has previously explored blockchain solutions, setting up a Blockchain Integration Hub, which enables brands to choose blockchain solutions based on their requirements. Within the hub, Arianee certificates can create a permanent record of products tracked and establish a communications channel with the customer who owns the products. This value extends to the resale market and managing the transfer of products between owners.

Although blockchain technology hasn’t been the traditional direction of retailers concerned with product traceability across the supply chain, some of retail’s biggest names are considering it for anti-counterfeiting measures.

Amazon recently was awarded a patent for a blockchain-based system that can track items as they move through the supply chain using a “distributed electronic ledger,” which compiles data from distributors, manufacturers, couriers and end users on an open framework designed to reveal product origins across information silos.

H&M also reportedly sought out blockchain technology to help improve traceability for its upscale Cos brand. Although H&M would not comment on the matter, the fashion retailer has been linked to enterprise-focused blockchain ecosystem VeChain. With VeChain’s MyStory traceability platform, shoppers can see the full history of a product by scanning a product’s QR code, which will indicate where specific processes, including yarn spinning, knitting and inspections, take place.