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By Charles Awanda, Certified Blockchain Expert, Chief Knowledge Broker Songhai labs.
Blockchain is widely known as the technology behind the popular bitcoin cryptocurrency. But as the name indicates, it is an end-to-end digital record of a given transaction.
Blockchain is made with individual records called blocks that are linked together to form a chain of blocks. Blockchain is designed to be transparent, immutable, secure and distributed.
Although the best known applications of Blockchain are in the world of finance and technology, Digital Marketing could be an area that will see an explosion of blockchain applications in the coming years. In this paper, we will explore 3 key reasons why digital marketers should embrace blockchain.
You can promote ads without intermediaries
Current digital marketing advertising models now use third party companies such as Google to promote advertising.
Let’s take an example. Let’s say a company wants to use search engine marketing for promotion. Instead of organically finding advertisers, they may decide to display Google banner ads on their website due to Google’s credibility and reputation.
In this case, Google will act as an intermediary. Google is a third-party platform that connects advertisers and customers.Third-party companies are then used as intermediaries in the process between the companies that serve ads and the consumers of the end users.
What ad promoters hope to get from third parties like Google is to use their reputation and ability to reach targeted audiences.
While this approach is the most used, it doesn’t always guarantee an appropriate targeted audience and generates costs from ad promoters to compensate for third party companies.
Blockchain allows advertisers to skip intermediary networks and advertise to a more targeted audience that is actually interested in viewing the ad.
BAT’s brave browser (Basic Attention Token) will reward consumers with tokens for the ads they interact with. So, in this model, commerce is not focused on the availability of ad space, but rather on the attention that the ad generates.
It can eliminate advertising fraud
Advertising fraud is a criminal activity that uses deliberate and harmful techniques to distort and distract the delivery of ad content to the correct targeted audience. Advertising fraud can take many forms: traffic fraud, click fraud, conversion fraud, ad stacking, etc.
One of the main reasons advertising fraud occurs is because third party companies that play the role of intermediaries have no incentive to distinguish between humans and robots. Blockchain technology can significantly reduce ad fraud as it introduces radical transparency to the ad industry.
Advertising is essentially a numbers game. Digital publishers get most of their money from displaying ads, but at the same time, displaying ads is a function of the traffic that digital publishers can drive to their websites. To capture that traffic, various fraudulent activities are initiated.
According to a report by emarketer.com, digital advertising generated about $ 128.53 billion in 2019 and was expected to account for about half of all media ad spend. In that year, some 42 billion were lost in fraud.
If the trend continues, the amount of advertising fraud could reach 100 billion by 2023. Hence the critical need to address the problem.
Blockchain offers an ideal solution to combat advertising fraud. Tracking makes it easier for advertisers to keep track of who is viewing the ads and ensures that the ads are targeted to the right target audience.
Through the blockchain, it is possible to develop effective performance metrics involving total spend, number of views, conversions and engagement rates that optimize ad security and accuracy in targeting real audiences.
There are currently several blockchain startups and projects that combat advertising fraud using blockchain technology.
Toyota is currently developing a blockchain-based advertising model in partnership with Lucidity, a blockchain advertising analytics company. Through this partnership, Toyota hopes to reduce the impact of fraud on digital ad purchases.
In addition to Toyota, IBM is also working on a version of its enterprise blockchain solution, Hyperledger Fabric, in partnership with Mediaocean, a digital advertising company and other companies Unilever, Kellogg’s and Kimberly-Clark.
The project should record impression-level data and related transactional data, such as purchase orders and payments, to better track customer impressions and journey.
It is profitable
Both advertisers and publishers can substantially increase their profits in digital marketing by using Blockchain technology.
According to a Forrester Research analyst, by removing the middleman, ad publishers can increase their CPM (cost per thousand impressions) from $ 1 to $ 5. Blockchain does it even better, it can allow companies to pay their audience directly. targeted to display their ads, completely negating the need for an intermediary.
Eliminating the middleman will make the ads more profitable as marketers won’t have to pay additional transaction fees.
A typical advertising campaign can result in multiple commissions paid to third party companies such as an agency trading desk, demand side platform, supply side platform, ad exchange, and various other networks.
In some cases, intermediaries or third-party companies can bear almost half the costs of an advertising campaign. The savings generated by blockchain adoption can be important and ultimately increase a company’s profit.
TibeOs, a company that uses blockchain for digital marketing, says that using their model, publishers receive 85% of an ad’s revenue share.
This is approximately 50% -100% more revenue share of most of the major networks, which represents a significant revenue improvement.
This trend is expected to generalize as Blockchain is widely adopted in digital marketing.
Finally, the advantage gained in reducing ad fraud with blockchain will directly benefit advertisers. Instead of losing revenue to bots and scammers, digital marketers using blockchain technology will eventually have ads that will fully reward them for the money they invested.
Prepared by Patrick O’Brien.
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