Ah, Italy. Anywhere we go, no matter our origins, most of us are charmed by the picturesque lines drawn by the hills in Tuscany, by the boot-shaped coastline, or maybe by the vibrant lifestyle of metropolitan Milan and Rome.
Another telltale sign that will certainly make your senses tingle is typical Italian winery: the restaurant aficionados will never deny a good glass of Montepulciano, and also me, as a full-bred Venetian, have a knack for our original Valdobbiadene and Valpolicella. Sounds pretty typical, doesn’t it?
It is worth noting that all firms who operate in the industry of quality wines rely heavily on a particular type of brand awareness: the customer demands a particular taste, from a specific source and with a given set of color, intensity, fragrance and texture that only a single canteen can produce.
More generally, the Made in Italy brand is consistently a guarantee of quality, sourcing and values across industries. While it is critical that firms are able to transmit the value that they added to the process, it is also true that this message is carried only by the etiquette and the broad knowledge of restaurant sommeliers. Due to this asymmetry, information often is lost in the process, enabling counterfeits and adulteration.
In a recent survey carried out by Ernst and Young, 74% of respondents conceded that their choice in the purchase of wine is influenced by the product’s transparency and traceability; 60% read the label both while buying and consuming the wine, to verify its sustainability.
A staggering 20% of the world’s wine is counterfeited, and this affects consumers and companies alike, providing a negative externality to the whole industry: it is estimated that the Italian wine industry alone loses two billion euros per year due to counterfeiting. Finally, 89% of consumers would like to know more about the Italian wine and the criteria used to determine the designation of origin, and pay a premium for the service.
Blockchain has the power to do just so: with wine blockchain, you can give customers a full account of the wine’s DNA through real, uneditable data collected during the wine-making process. The system creates a register for the certification and the secure transfer of data; a sort of database that contains information for every stage of the process, from cultivation to bottling: a detailed, shared, transparent and direct source of information on the entire production process, visible to all players involved, in order to verify the accuracy of the information stored, and give consumers the full story behind their bottle.
This happens so as to support the values of the Italian wine industry, the made in Italy brand as a whole, and communicate the product’s territoriality, authenticity and quality.
This technology does not only benefit consumers: producers are able to geolocalize consumption via distribution data. Therefore, they really can get to know and profile their consumers by inviting them to share their experiences. This is an undoubted advantage for producers: improving perceived value of the wine has the power to drive sales and profitability.
Even though the pathos of a good restaurant’s experience, and the precious advice from a sommelier, cannot be wholly replaced by technology, a simple scan of a QR code can send customers straight to the web interface that presents all information precisely, maximizing trust and reliability.
Blockchain has the potential to revolutionize yet another industry and strengthen an everlasting brand against the test of time – and technology.
Cheers from Leo DiCaprio and the BCforall team
Lorenzo M. Zorzi Chiarioni
Master’s in Management Candidate