Please describe your proposed solution.
Our project is the natural evolution of our Fund8 proposal and one that we are undertaking with all the expertise and understanding of the African market that we accrued in the last year working on Logyq.
After launching our blockchain tracking app, we realized that simply slapping our own blockchain label onto products sold on various e-commerce platforms would not be sufficient to solve the severe trust issues that plague African online commerce. We needed to create a new platform, one that would focus all of its brand and value proposition towards trust, in order to truly fill the gap in African e-commerce.
Thus was born our idea for Logyq Social Commerce, a platform that takes the best insights from e-commerce brands from all around the world - especially Chinese-based Little Red Book and Pinduoduo - and combines it with our deep understanding of the East African market to arrive at a new paradigm for online shopping, one that combines user interaction with blockchain-enabled tracking in order to convey trust to its customers.
The platform:
All of our product is built around creating trust for the end user, and all the underlying technology is applied for that same goal.
Over the course of the last year we realized that our tracking protocol alone is not enough for conveying trust, and a holistic, all-encompassing approach is needed in order to make users feel safe about the quality of the service provided and the items that they buy.
This philosophy is what inspired us to create a new generation social commerce platform, combining best practices from Chinese e-commerce apps with our proprietary tracking technology in order to assure customers that their products are original and that the reviews they read about them have been posted by real people.
In addition to our blockchain labels and verified reviews, users will be able to interact with a virtual assistant powered by AI, which will be able to assist them with basic tasks including solving problems with the app, suggesting clothing sizes for specific items and sorting products based on user prompts. Our AI assistant will evolve over time in order to tailor to each user’s personal taste, gather his feedback and suggest new products to check out based on a user’s search history and feedback.
Verified reviews will be incentivized by our proprietary token, GYQ, which will power the review ecosystem and distribute value to positive actors within the platform; DIDs such as Atala PRISM will be integrated to further verify the identity of users, in a completely anonymous way.
A scan of the QR code on one of our blockchain labels will enable the product’s buyer to post a review and get rewarded in tokens by the vendor; with this system, the only way to post a review is to buy an item on our own platform, positioning Logyq as a greater source of trust than its competitors.
The nature of the token incentives - which are rewarded automatically and can be spent for discounts on any other product on the platform - makes it so that users are more inclined to write product reviews regardless of their opinion of the item, while on other platforms 90% of reviews spur from either an extremely positive or extremely negative experience.
Since reviews are permanently notarized on the Cardano blockchain and linked to the data of the item they refer to, vendors will need a tool to flag reviews that are false or badly written from being posted: this is where we designed our decentralized dispute resolution mechanism. When a review is flagged by a vendor (in a window of 5 days from posting), other users of Logyq can be summoned to give their opinion on the matter and vote on wether the review is correctly written or not; voters will be rewarded for their efforts in tokens, and we will test and tweak this governance system until it becomes self-sufficient.
Decentralized Identity Solutions will be integrated into both of these systems, and will strongly augment the security of the whole review ecosystem since it will be possible to anonymously link any review to a DID and be sure of its veracity without disclosing any data about the poster.
Paramount to establishing a strong sense of trust on the platform is user experience: we will tirelessly A/B test our approach in order to arrive at a perfect mix of gamification and ease of use, which will ensure our users feel safe while shopping without having any trouble understanding how to navigate the app.
Finally, our vision of becoming the most trusted platform in the market requires us to select the best products by category and making sure that only good suppliers, vendors and delivery companies are onboarded on the platform, ensuring a great experience for all customers. We will personally vet companies by testing their products and gathering feedback on their offerings, striking a balance between quality and cost in order to offer the best bargain to our customers for any given product category.
Furthermore, by tracking every item sold on Logyq with our blockchain labels, we will be able to offer a vetted second-hand market for our products, enabling circular economy practices and creating further value for our customers. By buying on our platform, in fact, users will be able to access an exclusive second-hand market for their items, with the certainty of being able to sell what they bought at a better price than on competing second-hand channels, because of the lack of intermediate parties in the transaction.
How it works
The inner workings of our tracking protocol powered by the Cardano blockchain have already been thoroughly explained in our Fund8 Proposal and our V1 Whitepaper, therefore we will not go into detail about it here.
The one major update to our tracking protocol, which directly ties into our second-hand marketplace feature, is the addition of a Digital Product Passport, which we define as an evolution of our blockchain label which is able to follow a product over its lifetime, registering every modification or maintenance it goes through. While useless for inexpensive and disposable products, it provides real utility for any item which will undergo maintenance throughout its lifetime, especially for the selling of used goods: when accessing the second-hand marketplace internal to Logyq, customers will be able to consult the full history of a given product and be certain of its condition.
Using product passports for every item enables us to offer more value to our users: by buying on Logyq, they have the option of reselling what they bought directly on the platform, saving on third party fees and ensuring a second life for the products they do not need anymore.
The DPP works as follows: the blockchain label that normally leads to a static, non-modifiable page, instead leads to an interactive page that can be modified by the owner of the product passport, which is linked to a unique Logyq account. Authorized third parties, such as mechanics or tech maintenance workers, can modify the product page as well, by logging in with their account on the Logyq Protocol app.
When an item is traded, its ownership shifts from the buyer to the seller, who is now able to modify the passport at will. When an item is listed for sale, its passport can be accessed by anyone that wishes to bid on it, in order to correctly gauge its value.
Each user is able to consult all updates on a product passport both on our frontend and by on-chain analysis of product metadata; it is possible to see all past information registered about the item, with timestamps for every posted update.
For different kinds of products, it is possible to set up a particular DPP with different degrees of modifiability: specific properties can be setup to be modifiable or not, so that a passport might be set up only for adding information to it, or that only some of those properties might be modified while others cannot be.
The e-commerce app itself is built as a centralized marketplace, seamlessly integrated with our tracking protocol so that all products sold on it are tracked with Logyq Protocol and paired with a unique blockchain label. Blockchain labels in turn are the basis for our verified review ecosystem, which leverages QR code scanning and our proprietary GYQ tokens to nudge users to post personal reviews that can be directly traced to the specific bought product; furthermore, prospective buyers and users considering different options can ask specific questions to customers who already bought the item, in a completely anonymous way, and reward the answering party with GYQ tokens.
The app itself is built as a mobile cross platform, so that we will be able to connect to all mobile users in Africa: while a desktop version will be made available later, we will not focus primarily on it since most of internet usage - and virtually all of consumer usage - in Africa is mobile-based.
User experience will be that of a social commerce, with a main “discovery” feed where users will be able to discover new products based on their preferences, including posts from influencers and regular users showcasing and reviewing items; a search bar for looking for specific products; finally, a content creation feature that will enable all users to post their reviews and pictures to the main feed. All this will be accompanied by social networking features that will enable users to connect with their friends, and the possibility of sharing posts across all major social and messaging platforms.
We will integrate payments by striking deals with major African payment providers, such as MomoPay and Flutterwave, and integrating their API into our platform. We have already contacted representatives of both companies and are in the process of closing deals with both of them.
Of course, we will work on integrating ADA and stablecoin payments on the platform; it will also be important for merchants to convert their cryptocurrency to FIAT money, which will be achieved through partnerships with pan-African crypto exchanges such as LBank. It is important to note that the main obstacle to crypto payment integration in East Africa is not technical, but rather legal: regulators in our target countries have very strict rules about cryptocurrency payment, therefore it will take considerable time to establish a good communication channel with government representatives, and arrive at a satisfactory agreement.
Our AI personal assistant is built upon Stregatto, an open-source tool built on top of OpenAI’s API that’s able to be trained with bespoke data in order to provide personalized responses to questions. Stregatto can be integrated into our app and perform function calls when the assistant is asked question, answering questions and solving problems as if a real person were behind the screen. Users can also be assisted in onboarding the app, by explaining to them the different available features and prompting them to use them in the correct way.
Over time, we will program the bot to interact directly with the app, enabling it to perform complex product research based on prompts, gather user preferences and responses in order to suggest items, and solve ever more complex problems concerning the app.
Business model
Our business model is fairly simple: we collect fees on each sold item , and also sell advertising space and visibility to vendors on the platform.
When we surveyed small e-commerce sellers in African countries, their main problem with existing platforms was their exorbitant take rates of up to 30%; while e-commerce in Africa has historically presented issues with delivery and fulfillment that contributed to higher fees, we believe lowering our platform’s take rate to a healthier 8 to 12% can provide more benefits to our customers. Having lower commissions can lower the overall price of goods while maintaining a high quality standard, which will further empower us to become the leading e-commerce platform in our countries of entry, and later in all of East Africa.
Since the main differentiator of a social commerce platform is its discovery feed - which nudges users to explore new products and services rather than searching for them - staying top of mind for vendors becomes paramount. We will sell advertising spaces and top page visibility to vendors, so that their products or ads will show up more predominantly in our feed, similar to how Instagram and Tik Tok ads work.
In the future, we will also organize ad hoc advertisement campaigns with partner vendors, selling personalized ads packs that include top feed visibility, custom notifications and an integrated communication strategy.
How does your proposed solution address the challenge and what benefits will this bring to the Cardano ecosystem?
We believe our platform can greatly increase adoption of Cardano and its products by East Africa's population.
Apart from our tracking protocol, we will be leveraging the full suite of IOHK products coming in the next months in order to onboard more people and offer a more decentralized and complete user experience.
Most notably, we will integrate Decentralized Identity solutions such as ATALA Prism as soon as they will be available to the public; DIDs offer an efficient and anonymous way of proving one's identity online, and are therefore the perfect tool to ensure that our verified reviews are posted by real people. Furthermore, users will be able to sign up to the platform with their DID, enabling lightning-quick onboarding without the need for an email address.
Another area which is naturally ripe for integration is that of stablecoins: we believe our platform can be a major adoption driver for Djed, IOHK's algorithmic stablecoin. While it will not be possible to pay with it at launch, we will work hard to solve the regulatory issues that are now present in our markets of entry, and allow users to pay for real-world products with ADA and Djed. At the same time, we will also allow users to pay with other cryptocurrencies, as we believe that in order to drive adoption of blockchain technology it is necessary to cater to the biggest audience possible.
How do you intend to measure the success of your project?
Our first measure of success is the satisfaction rate of our customers, which in turn will better the East African's public opinion of online commerce and blockchain technology. We believe this will have ripple effects on the perception of Cardano by our customers, which will in turn drive more awareness of the overall opportunities provided by decentralized technology.
A Net Promoter Score (NPS) over 50 is the result that we are striving for, as it is a good measure of how many of our customers will be active ambassadors of our platform: a 50+ NPS will ensure word-of-mouth growth of both Logyq and Cardano's awareness.
A Net Promoter Score survey asks a simple question: “On a scale from 0 to 10, how likely are you to recommend this product/company to a friend or colleague?”. NPS is calculated by subtracting the percentage of customers who answer the NPS question with a 6 or lower (known as ‘detractors’) from the percentage of customers who answer with a 9 or 10 (known as ‘promoters’).
Our second measure of success is the social engagement rate of our customers, which we will measure by the number of posts and especially reviews posted on Logyq: we will strive for at least 15% of reviews posted for every item bought. This is a very ambitious goal considering the average review rate of 2 to 5%; however, we strongly believe that with our token reward system and gamification UX we will be able to attain this rate.
Product pages with at least one review experienced a 354% increase in conversion rate and a 446% lift in RPV compared to product pages with no reviews, whether or not visitors engaged with the review content (source: https://www.bazaarvoice.com/wp-content/themes/bazaarvoice/_sei-2019/static/downloads/BV19-SEI-Main-NA-Final.pdf); for this reason. we believe our platform will strongly benefit from an higher rate of reviews per item bought.
Please describe your plans to share the outputs and results of your project?
Outputs will be shared on Catalyst reports in order to be available to the whole Cardano community; news relevant to Cardano and Atala will be shared on social media tagging their respective accounts. Deliverables and specific outputs are defined below.
All of our insights about what we are building will inform our strategy decisions further down the line, especially focusing on testing our value proposition.