How Amazon and Starbucks are Impacting the Cryptocurrency Market
According to statista, Amazon and Starbucks reported net sales of $178 billion and $ 2.88 billion respectively in 2017, evidently, these two companies are major players with global presence. Recently, both Amazon and Starbucks have showed intention to use blockchain technology and/or virtual currency in their systems.
Amazon hinted at this move through a survey targeting its customers. In the survey, more than half of persons interviewed expressed willingness to use an Amazon-based cryptocurrency in their transactions. One the other hand, Starbucks gave a hint during an interview on FOX business.
During the interview, Howard Schultz, Starbucks’ executive chairman, pointed out that the company would build a blockchain-based application and potentially use a digital currency in the system.
Merits of crypto adoption The biggest merit of the blockchain technology to both companies is its value on the supply chain management. According to Eran Eyal, CEO of Shopin, the companies may have different systems, but their supply chains will benefit from using blockchain technology.
“It’s imperative to differentiate between blockchain solutions and cryptocurrency solutions for Starbucks and Amazon. Both companies can substantially benefit from incorporating block chain solutions especially around supply chain management and for Starbucks in particular, internal community management,” Eyal notes.
Further, due to Starbucks’ coffee chain business, blockchain will open up territories in which they do not usually operate due to data ownership issues.
“There is also the matter of data ownership which prohibits Starbucks in many ways in a variety of territories. The issue for data ownership, in Korea for example, is a substantial barrier to how data is stored. It’s my belief that by using Blockchain Solutions, many of these issues can be overcome if there is a willingness by Starbucks to put the data in the hands of the users instead of storing it themselves,” Eyal adds.
If the two companies use digital currencies, their customers will also benefit. According to Eugene Liebermann, CEO of CAR token company, Amazon and Starbucks’ need to consider giving customers discounts on products and/or services.
“I’d say the only useful case for these companies to issue own tokens would be to provide 10-20% discounts on their service or goods,” Liebermann notes.
Impact on corporates Players in the cryptocurrency industry hold different views on what the impact of blockchain adoption and digital currency will have on the market. According to Linda Butcher, the CMO Rewards Token, blockchain adoption will only help of it leads to increased global acceptance.
She says, “Taking crypto mainstream is Rewards.com key message. The more retailers we have that will either take crypto or produce their own token means more global acceptance. It is good for the entire industry.”
However, Liebermann argues that it will only have an impact if the companies use cryptocurrencies that are already in the market.
He says, “The power of the off-chain brand doesn’t make much of a difference in the crypto community. Ask yourself a question, how many partnership contacts Bitcoin announced since 2010.”
For Amazon and Starbucks, integration of blockchain technology and digital currency will give them a competitive edge in their spaces. The cryptocurrency market can thus tap into these developments to increase growth options.
Disclaimer: David Drake is on the advisory board for most of the firms mentioned or quoted in this article.