The pace of the luxury industry is rapidly increasing because of a massive rise in demand from consumers, which has constantly been shifting. While the consumer market appears to be more complex than it ever was, however, it’s nothing with the sheer complicated nature of the need for luxury goods. The reason is twofold. First, regarding individual tastes, the segmentation of the luxury market isn’t always easy to satisfy. In addition to keeping abreast of the most recent trends concerning pop culture or technology, the premium market is eager to be open to learning and listening.
Recently, luxury brands have embraced virtual experiences, including technology into their design and even collaborating with tech-related brands for more excellent appealing crossover. The last week, I had a meeting together with USDA along with The American Cotton Farmers to discuss how we can maintain the advantages that come with one of the most premium kinds of cotton available on the market in the present; Supima cotton. I was astonished to discover that the American luxury brand of cotton had made the virtual reality concept a key element in their strategy for marketing. It’s a fact that technology and fashion have joined forces and will continue to advance in tandem.
Take AURA as an example. It is a consortium blockchain that was developed by Group LVMH. Group to trace and track luxurious goods-from the beginning of their production to at the point of purchase so that they can assure customers of the history of their product and proof of authenticity. The question is whether or not the forthright luxury brands will go ahead with cryptocurrency. This is a good thing. Over the last decade, the cryptocurrency market has grown to become an extremely disruptive technology around the globe that has secured widespread acceptance around the world. Indeed, today, Time Warner and WeWork are accepting bitcoin as a reliable payment option. However, the question is: will luxury brands be the next to adopt cryptocurrency’s future?
Let’s face it: in the luxury industry, being isolated people (due to COVID-19) is extremely interesting for the luxury sector. The pandemic has seen increasing numbers of individuals looking to fintech solutions — and cryptocurrency to hedge their bets in the face of falling stocks. In addition that the year 2020 saw a bitcoin surge with an enthusiasm that is nothing short of historic. In reality, the rally sparked the need for a massive rise in the value of cryptocurrency. However, the most significant moment came when the data revealed that those in the luxury market were integral to the surge in cryptocurrency. In the end, it’s essential to realize that Generation Y and Gen Z are the most enthusiastic about the potential of cryptocurrency.
We discussed the issue with the department’s fashion luxury chair and the NY’s Fashion Institute of Technology data expert professors. We all agreed that for companies to thrive and survive in the current business environment, they will have to comprehend the modern way of doing business. This includes establishing an appropriate cryptocurrency strategy that meets your specific requirements.
Some are already received this message. Some luxurious brands have announced pro-crypto initiatives within the past few years. In 2018, Hublot unveiled a brand new watch within their Big Bang line that was solely focused on bitcoin. The look, dubbed”the Meca-10P2P was developed to celebrate the 10th anniversary of bitcoin. It can only be purchased using bitcoin, which was transferred with the code engraved on the edges of the watchthis cost about $25,000.
In 2021 Swiss brand Hublot announced its plans for 2021 to start accepting cryptocurrency as a form of payment and join the ranks of other watchmakers like Frank Muller and Norquin-which both announced similar plans in 2021 and the year 2020, respectively.
Cryptocurrency has not been restricted to watchmakers in terms of the luxury sector. For instance, TJB Super Yachts announced that they would begin accepting cryptocurrency to lease and purchase their yachts. According to this No Third Party, the leading coins include bitcoin and litecoin.
In a different context regarding art, the Sotheby’s Auction house has sold a painting by the famous artist Banksy called “Love Is in the air” at the end of May in 2021. The price was $12.9 million. This was the first time artwork was auctioned by a major auction house that deals in cryptocurrency. Because other major auction houses such as Christie’s also have NFT auctions (which are built in the same way used in cryptocurrency), it will likely be the case for the next. The performer Chris Brown created an NFT together with athletic sportswear company NIKE that brought in millions of dollars in NFT sales. The impact of cryptocurrencies on the luxury market isn’t restricted to only physical goods but is interspersed throughout experiences. The luxury travel agency, Travala.com is one example. It allows customers to pay for hotel accommodations and other travel experiences with a broad range of cryptocurrencies, including the company’s own AVA token.
With blockchain technology, fashion companies can digitally their inventory track and trace the entire life cycle. Blockchain technology allows brands to keep an unchangeable document of each step of the supply chain and capture particular data items, like sustainability certifications and claims, and make available the data. For instance, take Scallop as an example of a decentralized financial institution that lets users establish GBP/IBAN accounts in minutes and use cryptocurrency for daily purchases.
Suppose you have an account for business or personal use. In that case, Scallop users can spend both cryptocurrency and fiat currencies in one go by using funds with banks and a crypto wallet, and the virtual debit card. To use cryptocurrency to make luxury shopping, Scallop users do not need to withdraw money or transfer them to merchants manually. Still, they can simply choose the currency they would like to spend and then make payments as they would using a conventional debit card.
There is also Cirus which allows people to earn cryptocurrency more comfort. Cirus hopes that many more people worldwide will start earning cryptocurrency using simple methods such as monetizing their website soon. Cirus functions as an internet monetization device through its router that opens the way to widespread adoption and boosts the demand for newcomers to crypto to buy tangible assets such as expensive clothes. By creating an avenue to generate more income and spending, the world of luxury could be encouraged. However, it is not the only way blockchain technology is making its way into the luxury market since non-fungible currencies (NFTs) are also making waves.
For fashion companies, blockchain technology could drastically reduce operating costs in the retail industry by providing more efficient tools for managing data, enhancing supply chain management, and decreasing the chance that counterfeit market products are available. Advancements in data management can lead to savings in costs and increase trust in outsourcing, from shipping to overseas suppliers. In short, blockchain is an easy method of integrating data reconciliation across different service lines and operations.
Luxury brands are beginning to connect the physical and digital worlds with posh art exhibitions with NFTs and other collectibles. Dubai recently held the NFT BAZL that put on the display of $4 million worth of diamonds, curated through Icecap and Icecap, alongside artwork created by several winners and The memorabilia from Floyd Mayweather.
Participants and auction bidders could buy the items using cryptocurrency. This was the first NFT BAZL was introduced in the spring of this year by online investment company Elitism and a Canadian digital asset company GDA Capital. The event attracted crypto billionaires and local art enthusiasts interested in the latest technology.
While considering cryptocurrency as a form of payment, particularly given how certain volatile types of cryptocurrency can be, it is a bit complicated. Some services have sprung up to assist the luxury brands in managing their back-end. One of the significant obstacles to those looking to purchase expensive brands is the price of many products sold. However, installment payments and credit card options are far from practical as Staking, a brand new purchase option provided via MinePlex, a CrossFi marketplace and platform.
Staking in commodities only requires the buyer to pay a portion of the item’s price in the form of crypto. The amount is staked to earn interest. When the interest has been reached and paid, the retailer pays it, and the buyer can then receive the product. This is a brand new method to purchase expensive items in it doesn’t impact the users’ credit scores. This feature can save up to 40% of the costs of credit cards and loans. Given how sought-after luxury goods are with young people with low earnings, it is likely to be a hit.
The luxury sector, just like many other areas, will require time before blockchain technology and cryptocurrency, in general, are integrated into it. The process of accepting crypto and incorporating blockchain technology into the market is already underway, and, according to all indications, it is not likely to stop anytime soon.