The Impact of Blockchain Technology on E-Commerce and Supply

Chain: Case Studies of Walmart, Sephora, and Blockbuster

Siyu Deng

College of Letters and Science, University of Wisconsin - Madison, Madison, WI 53706, U.S.A.

Keywords: Blockchain Technology, E-commerce, Supply Chain Management, Digital Transformation.

Abstract: This study examines the application of blockchain technology in e-commerce and supply chain management

and its impact and analyzes how blockchain can enhance supply chain transparency, optimize operational

efficiency, and increase consumer trust in the context of Walmart's and Sephora's successful cases. Walmart

utilizes blockchain technology to achieve efficient supply chain management and product traceability, thus

enhancing market competitiveness. Through digital transformation and blockchain technology, Sephora has

improved user experience and market responsiveness. In sharp contrast, Blockbuster, which failed to adapt to

the digital change in time, eventually lost in the fierce market competition. The study results show that

blockchain technology has significant advantages in supply chain management and supports the overall digital

transformation of enterprises. Through in-depth case studies, this study provides an empirical basis for

applying blockchain technology. It offers suggestions and strategies for other enterprises on effectively

utilizing blockchain technology in digital transformation to help them enhance their market competitiveness

and achieve sustainable development.

1 INTRODUCTION

In recent years, the development of blockchain

technology has sparked widespread interest,

particularly in e-commerce and supply chain

management. Blockchain technology offers new

solutions to increase data transparency, enhance trust

and improve operational efficiency through its

decentralized and tamper-proof nature (Kshetri, 2021;

Rijal & Saranani, 2023). These characteristics make

blockchain an important technology for many

businesses to explore and apply. In the retail industry,

blockchain technology is changing enterprises'

operation models and promoting cooperation and

trust-building among enterprises (Pan et al., 2020;

Javaid et al., 2021). For example, globally renowned

companies such as Walmart and LVMH have begun

to utilize blockchain technology to improve their

supply chain management and ensure product

authenticity and traceability, thereby increasing

consumer trust and satisfaction. These case studies

provide a better understanding of the effectiveness of

the practical application of blockchain technology in

e-commerce and supply chain management.

https://orcid.org/0009-0003-0970-5066

By analyzing two successful cases, Walmart and

Sephora, in detail, this study will explore how

blockchain technology can help companies stay

ahead of fierce market competition while improving

the transparency and efficiency of their supply chains.

This study will also conduct a case study of

Blockbuster to demonstrate the challenges and

consequences faced by companies that fail to make

timely digital transformations. Through these cases,

this study provides lessons for other enterprises to

understand better and apply blockchain technology to

achieve a more efficient and transparent operating

model.

The next sections will introduce these cases in

detail and analyze the specific applications and

effects of blockchain technology in these enterprises.

At the same time, this study will also recommend

corresponding recommendations to help other

enterprises effectively utilize blockchain technology

in digital transformation to enhance their market

competitiveness.

Deng, S.

The Impact of Blockchain Technology on E-Commerce and Supply Chain: Case Studies of Walmart, Sephora, and Blockbuster.

DOI: 10.5220/0013329000004558

Paper published under CC license (CC BY-NC-ND 4.0)

In Proceedings of the 1st International Conference on Modern Logistics and Supply Chain Management (MLSCM 2024), pages 269-275

ISBN: 978-989-758-738-2

269

2 CASE STUDY 1: WALMART

2.1 Case Description

Walmart, founded in 1962 in the US, is a global

retailer with over 11,000 stores in 28 countries,

making it one of the world's largest chain stores and

private employers (Zhang, 2024). The company also

manages a significant e-commerce business, offering

various goods and services online. Wal-Mart's

business model revolves around its mission to help

people save money and live better. It is achieved by

delivering low prices at scale, leveraging efficiencies

and purchasing power, and consistently reducing

costs.

On the financial front, Walmart is a strong player

in the retail industry. In fiscal year 2023, Walmart's

revenue was up 7.3% globally, with broad-based

strength across segments. Walmart U.S. grew comp

sales by 8.3%, with e-commerce growth of 17%

(Walmart, 2023). This reflects efficient operational

management and strategic capital investments.

Despite its operations and expansion's highly capital-

intensive nature, Walmart maintains a solid credit

rating, illustrating its strong financial health and risk

management strategies.

Wal-Mart has a hierarchical and flexible

management structure that supports its large and

diverse global operations. The senior management

team, led by the CEO, oversees various segments

such as Walmart U.S., Walmart International, and

Sam's Club. Each segment has its management team

responsible for day-to-day operations to meet the

diverse needs of their respective markets. Wal-Mart

emphasizes strong local management teams with in-

depth knowledge of their specific markets, allowing

the company to respond to local consumer

preferences and regulatory environments while

benefiting from a focused strategy. Human resource

management focuses on diversity, equity and

inclusion and invests significant resources in training

and development programs. With over 2.3 million

employees worldwide, Walmart is one of the world's

largest private employers. Its workforce strategy

integrates advanced technology and employee

engagement practices designed to increase

productivity and job satisfaction. In terms of industry

position, Walmart is the world's largest retailer and

one of the most influential forces in the retail

industry. In the digital space, Walmart has made

significant investments to integrate the online and

offline experience, thereby solidifying its industry

position in the face of increasing competition from

pure e-commerce players. By 2018, it is estimated

that grocery delivery services will be provided to 40%

of Americans at home (Hsu, 2023).

Through initiatives such as enhancing its mobile

platform, expanding its online product assortment,

and logistics and delivery service innovations,

Walmart continues solidifying its position as a

physical and digital retail leader.

2.2 Case Analyze

Wal-Mart's strength lies in its global scale and market

leadership. It is the world's largest revenue retailer,

operating various store formats, including

supercenters, discount stores, and neighborhood

markets on multiple continents. This immense scale

allows Wal-Mart to utilize its size to achieve better

buying conditions, distribute goods efficiently, and

access a broad base of consumers. Wal-Mart excels in

supply chain management, employing a sophisticated

logistics system that includes warehousing,

distribution centers, and an extensive transportation

network that allows it to efficiently manage

inventory, reduce operating costs, and ensure timely

delivery of products. Walmart has been at the

forefront of integrating technology into its operations.

Walmart invests in AI, big data, and IoT to optimize

supply chain management, personalize marketing,

and enhance online shopping (Zhang, 2024).

Walmart's use of blockchain technology to improve

supply chain transparency and traceability is a notable

example of its innovation efforts. With the help of its

worldwide supply chain network, funny internal

operating style, and massive procurement efforts,

Walmart has developed an operating strategy that is

both efficient and cost-effective (Zhang, 2024). Its

improved distribution capabilities, streamlined

inventory management, and cutting-edge logistics

technologies allow it to provide faster and more

dependable delivery services (Zhang, 2024). In

addition, IoT devices in Walmart's warehouses and

distribution centers help monitor inventory levels in

real-time, ensuring timely replenishment and

reducing waste due to excess inventory. Through

these measures, Walmart has not only cut expenses

but also improved the efficiency of its supply chain

management. Walmart has effectively integrated its

online and offline presence to improve customer

shopping convenience. With features such as "Pickup

Today" and the Walmart app, the company provides

a seamless shopping experience that strengthens its

position in the marketplace against its online-only

competitors. Walmart has consistently demonstrated

strong financial health, critical to sustaining the

technology and infrastructure investments needed for

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digital transformation. The company's financial

strength has enabled it to weather the recession better

than many competitors. Despite Walmart's online

business growth, most of its revenue relies heavily on

brick-and-mortar stores. This dependence could

become a burden in a world where digital engagement

is more dominant than in-store traffic. In addition,

Walmart faces criticism and negative publicity

related to employee relations, product quality, and

environmental practices, which can affect customer

loyalty and brand perception, especially among

socially conscious consumers. Managing global

operations on Walmart's scale involves complex

organizational structures, sometimes leading to

slower decision-making processes and inefficiencies

in adapting to local market needs. The retail industry's

digital transformation has introduced more

competitors, including tech giants such as Amazon,

which compete directly with Walmart in multiple

market segments, and the pressure to continually

innovate and improve technological capabilities is

higher than ever. As technology evolves, current

investments may become obsolete, and new retail

technologies such as augmented reality or highly

advanced e-commerce platforms may disrupt existing

business models. In addition, with the increasing use

of digital platforms, Walmart faces the constant threat

of cyberattacks, data breaches, and security

challenges that pose a financial risk and damage the

retailer's reputation among consumers.

2.3 Suggestion

Walmart should focus on the following strategic

actions to expand its digital transformation journey.

Enhancing data analytics capabilities is key.

Leveraging big data and advanced analytics can help

Walmart understand consumer behavior, optimize its

supply chain, and personalize the customer

experience. Investing in predictive analytics tools will

allow Walmart to anticipate market trends and

consumer demand more effectively. Integrating

blockchain technology to improve supply chain

transparency ensures product authenticity and safety

and reduces costs by streamlining operations and

eliminating inefficiencies. Expanding omnichannel

capabilities is also critical. Walmart should enhance

mobile apps, integrate augmented reality (AR) to

provide a more interactive shopping experience and

utilize the Internet of Things to enable smarter store

solutions. Investing in employee training and

development is integral. As digital tools and

platforms become increasingly important to the retail

business, Walmart needs comprehensive employee

training programs to ensure that employees can

efficiently navigate these technologies to improve

service quality while boosting employee satisfaction

and retention. Partnering with tech startups can drive

innovation. These partnerships can bring innovative

solutions to Walmart, helping it stay ahead of

technology trends and adapt faster to changes in the

retail landscape. Walmart can also expand its digital

services and e-commerce solutions into emerging

markets. As Internet penetration in these regions

grows rapidly, Walmart will have the opportunity to

gain access to new customer segments and take

advantage of digital retail innovation.

3 CASE STUDY 2: SEPHORA

3.1 Case Description

Sephora is a global beauty retail pioneer founded in

France in 1970 by Dominique Mandonnaud, who

changed the traditional service model of the beauty

industry. Sephora has been a subsidiary of LVMH

(Moët Hennessy Louis Vuitton) since its acquisition

by LVMH in 1997. Financials Sephora maintains a

strong financial position within the LVMH portfolio

(Chen, 2023). Today, Sephora operates

approximately 2,600 stores in 34 countries worldwide

and expands its markets through a strong online

shopping platform. Sephora's management strategy

emphasizes innovation, customer experience and

digital integration. The leadership team, led by the

President/CEO, adapts global strategies to local

market conditions and consumer preferences.

Sephora champions diversity and inclusion, not only

in its hiring practices but also in its products and

marketing activities. The company employs

thousands globally, and many focus on technology

roles supporting its e-commerce operations and

digital transformation programs.

In the highly competitive beauty retail industry,

Sephora dominates with its wide variety of beauty

products and private label Sephora line. Sephora's go-

to-market strategy blends physical retail with a strong

digital presence. Its stores feature an iconic black-

and-white color scheme, encouraging customers to

explore and experience the products freely. This

experiential retail model is complemented by a strong

digital strategy, particularly in using augmented

reality and virtual try-on technology, which helps

boost online sales. In addition, Sephora has

implemented several beauty technology innovations,

such as the "Color IQ" system, which uses computer

vision to find a match for a customer's skin tone.

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Sephora's Beauty Board is a social media platform for

collaborative browsing, connecting with the

community and creating. The community site allows

make-up and skincare enthusiasts to take photos,

share their make-up and beauty tips, and get inspired

by other people's make-up tutorials (Mansouri, 2022)

3.2 Case Analyze

Sephora has multiple strengths in the beauty industry.

Its innovative digital engagement strategy has given

it a strong digital presence, particularly through

mobile apps and a highly interactive website. These

tools enhance the shopping experience and position

Sephora at the forefront of digital innovation.

Its robust e-commerce platform contributes most

of the company's revenue and is integrated with a

loyalty program that provides personalized

recommendations based on user behavior and

purchase history. In addition, promotional codes and

discounts offered on the official website entice

customers to take advantage of unique deals,

giveaways, and products. The official promo codes

and discounts offered by Sephora on their website

entice customers to take advantage of unique deals,

freebies, and products (Sephora, 2022)

Sephora uses sophisticated data analytics to

understand customer preferences and market trends to

provide targeted marketing, optimize inventory, and

develop products that meet customers' changing

needs. Its Beauty Insider loyalty program is one of the

most successful in the retail industry, with millions of

active members. The program promotes customer

loyalty and provides the company with valuable data

to further improve customer engagement and

satisfaction. Sephora can provide highly personalized

product recommendations through apps, email

marketing, and even in-store consultations by

analyzing detailed customer data. Sephora operates in

many countries worldwide and has a diverse global

market presence. This international footprint has

expanded its customer base and increased brand

awareness, making it a leading brand in the beauty

and cosmetics industry. However, Sephora also faces

several threats. Sephora faces multiple threats during

its digital transformation and market expansion. First,

the beauty and personal care industry is highly

competitive, with numerous established players and

new entrants, such as Ulta Beauty and direct-to-

consumer brands, constantly threatening Sephora's

market share. Rapid technological change requires

companies to invest to stay relevant continually.

Sephora risks falling behind if it fails to keep up with

technological advances in retail and consumer

engagement.

Meanwhile, Sephora offers services on different

digital platforms, including its website, mobile apps

and social media channels. An inconsistent user

experience between these platforms could lead to

confusion and decreased satisfaction. For example,

the mobile app may have different functionality than

the website, and users may need help switching

platforms. Sephora offers services on different digital

platforms, including its website, mobile apps, and

social media channels. An inconsistent user

experience between these platforms could lead to

confusion and decreased satisfaction. For example,

the functionality of the mobile app may be different

from the website, and users may experience problems

when switching platforms

3.3 Suggestion

Sephora should further expand its use of augmented

reality (AR) technology to create immersive and

interactive shopping experiences. This includes

virtual try-ons and personalized makeup tutorials,

features that increase customer engagement and

satisfaction. In addition, chatbots and virtual

assistants enhance the customer experience by

providing real-time assistance. These AI-powered

tools can handle customer inquiries, provide product

recommendations, and even assist with checkout.

Second, Sephora can offer customized beauty

products and services using AI and machine learning

technologies. Algorithms that analyze a customer's

skin type, preferences, and behavior can tailor

recommendations and solutions to improve customer

loyalty and increase sales. Sephora should utilize

digital platforms to build and strengthen its

community. This can be done through interactive

social media campaigns, loyalty programs and beauty

seminars. Engaging customers in this way can help

better understand their needs and preferences, leading

to improved service offerings. Companies that

showcase their community activities on social media

improve their brand image and reputation. Sephora's

public relations and marketing teams should

vigorously promote its global community activities

on Internet platforms to attract more customers and

fulfill their social duties (Chen, 2023).

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4 CASE STUDY 3:

BLOCKBUSTER

4.1 Case Description

Founded in 1985, Blockbuster was the leading video

and DVD rental company in the U.S., known for its

large network of chains and extensive movie

inventory. With its convenient rental service and "no

late fee" policy, Blockbuster reached the peak of its

business in the 1990s, with 2004 revenues reaching

$6 billion. However, as consumer behavior and the

technological environment changed, Blockbuster's

revenues began to decline, with a net loss of $146

million in 2005 and liabilities exceeding $1 billion

when it filed for bankruptcy protection in 2010.

Blockbuster suffered from frequent management

changes and a need for more consistency in strategic

decision-making. After its acquisition by Viacom in

1994, the company needed to respond to the digital

transformation by focusing more on financial

operations than strategic innovation. While

Blockbuster has attempted transformation strategies

such as launching a DVD-by-mail service, these

efforts have often been piecemeal and needed long-

term planning. With the rise of streaming services,

Blockbuster's industry position was rapidly eroding.

Emerging competitors like Netflix quickly dominated

the market through digital platforms and flexible

service models. While Blockbuster has been defunct

since January 2014, Netflix is today valued at around

$70 billion, making it the world ’ s 10th-largest

(Rowe & Sam, 2017)

Blockbuster's slow response to digital

transformation has gradually caused it to lose its edge

in the fiercely competitive market. Blockbuster tried

to introduce its own DVD-by-mail service in 2004,

but there needed to be more time. Blockbuster tried to

introduce its own DVD-by-mail service in 2004, but

there needed to be more time. Netflix started offering

that service in 1997 and kept looking ahead from

there (Rowe & Sam, 2017). As the digital

transformation accelerated, Blockbuster's heavy

reliance on brick-and-mortar stores became a burden.

The company was saddled with high operating costs

due to its large network of retail outlets, which

became increasingly unsustainable as customer

traffic declined.

4.2 Case Analyze

Blockbuster has high brand recognition as the once-

largest movie and game rental chain globally. This

awareness can attract many initial users to its digital

platform, providing a valuable market advantage.

Rich content resources are another major advantage

of Blockbuster. Its once-accumulated movie and

game resources can be repackaged and distributed

digitally, providing a solid content foundation for the

digital platform. In addition, Blockbuster has

accumulated a large amount of historical customer

data, and through data analysis, it can accurately

locate potential users and provide personalized

services and recommendations. However, primarily a

brick-and-mortar operation, Blockbuster's existing

infrastructure and management experience can also

support its digital transformation, especially in

content management and customer service.

However, Blockbuster needs to accumulate more

technology. In its past operations, it needed more

investment and accumulation of digital technology

and improved technology development, operation

and maintenance. The high cost of transition is also a

major challenge. Transitioning from a traditional

physical leasing business to a digital platform

requires a large capital investment and time,

especially in constructing the technology platform

and introducing talent. As a former offline rental

giant, Blockbuster's brand image may not appeal to

younger consumers accustomed to modern streaming

services. In addition, Blockbuster is inexperienced in

digital marketing, user experience design, and online

service operation, and it needs to fill these

shortcomings quickly.

The continued rapid growth of the global

streaming media market provides a huge market

opportunity for Blockchain to enter the space through

digital transformation. Blockchain can provide

personalized recommendations, enhanced content

security, and more efficient user management by

leveraging big data, artificial intelligence, and

blockchain technologies. Partnering with existing

streaming platforms, content production companies,

or technology companies can quickly enhance their

technical capabilities and content richness. In

addition, with the rapidly growing demand for

streaming services in emerging markets, Blockchain

can quickly enter these markets through its digital

platform and take the lead.

However, Blockbuster's entry into the streaming

market will face stiff competition from strong

streaming competitors such as Netflix, Amazon

Prime, Disney+ and others who have already captured

a major market share. The technology for streaming

and digital content consumption is updating very fast,

and Blockbuster will need to continue to invest to

keep up with the changes in the market, or it may

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become obsolete. Consumer entertainment

preferences constantly change, and Blockbuster risks

losing customers if it quickly adapts and responds to

these changes. Uncertainty in the global economy

may also affect consumer spending on entertainment,

which could hurt Blockbuster's digital business.

4.3 Suggestion

First, building a strong technical team is key. To this

end, Blockbuster should bring in top technical talent

and set up an internal development team to focus on

platform development, data analysis and AI

applications. At the same time, it can cooperate with

technology companies and outsource part of the

development tasks to improve the platform's technical

capabilities rapidly. In terms of content, Blockbuster

should carry out content reshaping and innovation.

Specifically, it should digitize its existing movie and

game inventory and cooperate with content

production companies to acquire new exclusive

content. In addition, it should use big data to analyze

user behavior and provide personalized content

recommendations, thereby increasing user stickiness.

Enhanced digital marketing is also an essential

part of the equation. Through social media platforms

such as Instagram, Twitter, and YouTube,

Blockbuster can rebrand and attract younger users.

By optimizing search engines and paid advertising

(SEO and SEM), the platform's online visibility and

traffic can be increased. Digital marketing often

utilizes the internet platform to make it easy to deliver

messages to target audiences, and through the

Internet, companies can reach out to global customers

and get their feedback (Akre et al., 2019)

In terms of partnerships and acquisitions,

Blockbuster should actively establish strategic

partnerships. For example, it has partnered with

streaming platforms (e.g., Netflix, Hulu) and

technology companies (e.g., Google, Amazon) to

enhance its technological capabilities and content

richness rapidly. Meanwhile, mergers and

acquisitions of smaller technology companies or

content production companies can acquire key

technologies and exclusive content. Finally,

optimizing user experience is the key to improving

user satisfaction and loyalty. Blockbuster should

optimize the platform's interface and interaction

design to provide a seamless viewing and gaming

experience. In addition, it should establish an efficient

online customer support system to solve user

problems promptly and improve user satisfaction.

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5 CONCLUSIONS

Combining online and physical channels is essential

due to the growing dominance of digital platforms in

the retail industry. In today's globalized, digitally-

centric environment, comprehending customers

demands innovative methods and ways of thinking.

An omnichannel strategy that unifies customer

experiences across all channels is crucial for staying

ahead of the competition. This approach enhances

customer experience and gives merchants valuable

insights into customer habits and preferences.

Walmart’s transformation has shown other retailers

the benefits of embracing digital technology.

Blockbuster and Walmart's case studies highlight the

critical importance of adaptability in the digital age.

Traditional retailers face challenges such as

decreasing foot traffic and evolving consumer

expectations, necessitating strategic adjustments to

thrive. Retailers should strategically integrate rapidly

evolving technologies into their business structures to

maintain competitiveness, optimize customer

experience, and streamline operations. Effectively

adopting and utilizing these digital innovations will

be increasingly important. Conventional stores can

prosper in the new digital era by staying ahead.

Traditional stores should monitor new technological

developments and frequently evaluate their impact on

business. Retailers ought to be agile enough to

anticipate and respond to changes in customer

behavior and technological trends. Adaptability and

readiness to revise strategies are key to keeping pace

with these changes. Conventional stores can weather

the digital revolution by making swift decisions,

aggressively adopting new technologies, and

thriving.

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