What advertisers need to know about Blockchain now


The advertising industry faces many challenges: from fraud and lack of transparency to old-fashioned payment models. But blockchain technology will soon solve these challenges, rewriting the future of adtech.

There are already – and will continue to be – more blockchain to serve the advertising industry. Several blockchains will serve different purposes, including consent management, tracking, payment processing and contracts. By working with our advertisers, I can see countless cases of use that would solve data transparency issues, mismatches in transactional payments and even the potential to mitigate fraud.

We are at a crossroads, though: solutions are emerging, but will the brands push the third-party networks and technology partners to adopt them? With the education and awareness and a bit of boldness on the part of these brands to come together and establish new industry standards for the processes supported by blockchain, we can realize this technology and its benefits for the. advertising industry.

Here the blockchain ways can add value to advertisers and agencies:

Data Transparency

Google, Facebook and Amazon have built enclosed gardens that contain cross-device data, media inventory and creative formats that work exclusively on their platforms. The result is a real lack of visibility of the data and its reliability. A public blockchain would allow advertisers and agencies to obtain verifiable truth about the number of impressions published in a campaign, who they were delivered to and where. Blockchain provides a system that works in parallel with the existing supply chain and integrates existing ad delivery, data targeting and yield management capabilities. With public blockchains, all the parties in the system get a transparent view of the supply chain and a clear understanding of where the advertising dollars are going. Private blockchains can also make sense if used by multiple parties, preferably by a larger group of actors.

Just as airlines join associations like One World and Star Alliance, we could see adtech publishers and suppliers coming together to use the same chain, as well as individual players hosting their own program. Some advertisers and publishers respect and trust each other and share a blockchain, while others may choose to retain control and possess governance. For example, enclosed gardens such as Google and Facebook can opt for their own private chains but make them publicly legible and replicable. To prevent big players from ruling these chains, it is imperative that advertisers, adtech providers and publishers start working together to set standards in public industry blockchains.

Smart Contracts

The National Advertisers' Association reports that 58 cents of every dollar of programmatic means go to a publisher, while the remaining 42 cents are consumed by supply chain data and commissions of transaction. With blockchain, all impressions could be managed through a smart contract that is updated daily with the latest delivery, impression or click data. It could also start paying at the end of the campaign, so advertisers and publishers can make transactions instantly based on individual impressions rather than end-of-month results.

Advertising Fraud

A WPP study estimates that over $ 16 billion of global advertising revenue was wasted on fraudulent traffic in 2017. Blockchain technology can provide a fully verifiable and unchanging government ledger of public transactions, which would allow to all parties to independently control spending along the supply chain to combat fraudulent traffic.

Also, since blockchains are decentralized peer-to-peer networks, there is no single point of failure and there is no single access point for malicious hackers. Therefore, it enhances data security and security.

Consent Management

The GDPR and other data privacy rules require that users consent to the use of their data. Given the high penalties for compliance violation, companies are investing more in data management and there is a critical need for consensus management platforms that can track and provide user consent information. This could very well be implemented using a distributed ledger, eliminating the need for a central management entity and resolving the issue of ownership of that consensus management platform.

Brands, a call to arms

Blockchain technology offers a more efficient service and a reliable solution to many obstacles in today's advertising industry; however, success depends on the adoption throughout the ecosystem, from advertisers to publishers and suppliers of adtech.

Advertisers can be a driving force behind fenced gardens to implement blockchain technology, just as they have done in the past with promoting visibility and branding security labels. Publishers will inevitably accept universal audience tags required by blockchain if advertisers push them.

Now is the time for a significant number of adtech players and advertisers to come together to take power over the governance of emerging public and private blockchains. Otherwise, someone else, probably the bigger players, will set the blockchain standards in their favor. By asking for the adoption of blockchains to safeguard their advertising investments, advertisers will force the rest of the industry to comply with these requests.

Markus Malti is CEO of WeQ.

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