Louis Vuitton Parent Company to Launch a Blockchain Platform to Track Luxury Products

When it comes to establishing a system of fair and transparent business practices, a number of companies are looking towards blockchain. LVMH, a luxury brand conglomerate and owner of Louis Vuitton is launching a new blockchain platform to track and prove the authenticity of luxury goods.

Currently code-named as AURA, LVMH’s blockchain platform will go live by May/June 2019 with the parent owner’s two major brands onboard - Louis Vuitton and Parfums Christian Dior. Eventually, LVMH plans to bring 60 of its other luxury brands and also its competitor brands.

Over the last year, LVMH’s full-time blockchain team has been dedicatedly working on the development of AURA. Also AURA is working on Quorum, the permission version of Ethereal blockchain. Quorum is largely a data privacy network and is developed by JP Morgan. A source familiar with the matter told the publication:

“To begin with AURA will provide proof of authenticity of luxury items and trace their origins from raw materials to point of sale and beyond to used-goods markets. The next phase of the platform will explore protection of creative intellectual property, exclusive offers and events for each brands’ customers, as well as anti-ad fraud.”

Using blockchain technology can certainly help high-end luxury brand to avoid duplicity of its products while protecting its brand reputation. It will also help the brands to better serve their customers in the long run.

Note that LVMH is not the first to propose the idea of having authenticity-tracking blockchain. Before this, big players like Vechain and Arianee have thought of a similar idea.

However, LVMH plans to offer the service in a white-label form to all of its subsidiary brands and also its competitors. Hence, instead of creating an app of some kind, AURA will run behind the brands using it.

The source explained: “So if you are a customer of a luxury brand, you are not going to see AURA; you are going to see the Louis Vuitton app or the app of another luxury brand”.

However, getting all competitor brands on a single platform is not an easy task. To avoid any clashes, “LVMH will donate all intellectual property (IP) to a separate entity and that entity, in turn, will be owned by the participating brands,” said the source.

The source also added: “So Gucci, for example, could decide to join the platform and be a shareholder – in which case their claim to the IP would be as great as Louis Vuitton’s claim to the IP. That is the main difference between this project and the IBM Maersk project, which hopefully makes it much more comparable to Komgo, the trade finance consortium.”