Effects of platform's blockchain strategy on brand manufacturer's distribution strategy in the presence of counterfeits

This study establishes a theoretical model between one brand manufacturer and one e-commerce platform. The manufacturer would like to open a new online channel through the platform apart from the traditional channel to attract more consumers. Nevertheless, the online channel has the threat of deceptive counterfeits, and the platform can choose to adopt blockchain technology to eliminate the counterfeits. The main results show that in addition to the anti-counterfeiting effect, blockchain also has an incentive effect. That is, the platform can adopt blockchain to incentivize the manufacturer to open the online channel as long as the blockchain's cost and the traditional channel's service advantage are not too high. In some cases, both the supply chain and consumers can benefit from blockchain. Besides, the impact of two channels' different characteristics on blockchain's value and the case of blockchain adoption with an anti-counterfeiting level are also analyzed.

Automated summary

This study establishes a theoretical model between a brand manufacturer and an e-commerce platform. The manufacturer aims to open a new online channel through the platform to attract more consumers, in addition to the traditional channel. However, the online channel faces the threat of counterfeits, and the platform can choose to adopt blockchain technology to address this issue. The main findings indicate that blockchain not only has an anti-counterfeiting effect but also has an incentive effect, where the platform can use blockchain to incentivize the manufacturer to open the online channel. Furthermore, both the supply chain and consumers can benefit from blockchain, and the impact of different channel characteristics on blockchain's value is analyzed.