Blockchain Will Disrupt Digital Advertising

How Blockchain Will Disrupt Digital Advertising

The rise of the fake is a phenomenon that is not limited to the physical world or the most recognized brands, but rather includes the digital world: fake profiles on social networks, fake news, fake ad impressions and clicks and even fake audiences. That is why many consider blockchain as a disruption to the digital advertising ecosystem.

Unfortunately, scammers are everywhere, even in the online advertising affecting the marketing digital. According to Juniper research, ad fraud costs more than $51 million a day. As John Wanamaker said, “half the money I spend on advertising is wasted; the problem is that I don’t know which half”. After more than 100 years, we are able to know which half exactly has been wasted.

Ad fraud costs marketers and publishers, according to Forrester research, up to 56% of total online advertising spend. And this cost globally is expected to rise to $50bn over this decade.

For this reason and according to a recent study on the state of programmatic advertising, 79% of advertisers are concerned about transparency, one of their key concerns.

The Age Of Truth

Thanks to the advancement of technology, it is possible to know that those who are dedicated to acting fraudulently also attack digital marketing through fake websites. This shows a pay per click (PPC) ad from a certain company where the scammer is responsible for creating bots to make constant clicks on a said ad. And what happens with this? The company or advertiser must pay money to this fake website every time the ad is clicked.

Unfortunately, being fake clicks and not from real people, sales are not made. With blockchain, every post and ad placement is viewed, shared, and updated on the blockchain. This brings maximum transparency to the digital ad supply chain.

By using blockchain, the advertiser will be able to have more control since it will be possible to see if it was a click from a bot or from a real person. In this way, the advertiser will be able to measure their return on investment (ROI).

Now the question is: What if advertisers and publishers met? What would happen if they dealt directly with each other, without involving them as intermediaries? This is where blockchain comes in. It not only connects advertisers with publishers by eliminating intermediary costs, but also ensures that users are real (not bots) and that the publisher charges the advertiser only for genuine clicks, with real ability to build brands and generate sales.

The advancement of blockchain in advertising is not new and is spawning a generation of service companies that aim to optimize advertising performance, the customer journey, and even loyalty programs. A good example is Rebel AI, which fights against ad fraud with a blockchain-enabled cryptographic verification system for companies. But how? The company assigns IDs that cannot be changed in a DLT to clearly see information such as whether those who have interacted with advertising have been bots or real users.

Benefits Of Blockchain For Digital Advertising

So, what are the benefits or changes produced by the use of blockchain when making or contracting digital advertising. The most notable thing is that the blockchain would eliminate the large intermediaries such as GAFA and Measurement companies, which are the ones that currently control digital advertising and those that act as intermediaries between advertisers (brands), end customers, and agencies:

  1. Blockchain allows advertising brands and publishers to interact directly, avoiding intermediaries that can cause part of the investment to be lost along the way.
  2. It would allow a more direct relationship between advertising companies and end customers, being in direct contact and exchanging information such as user behavior, their experiences…in this way, more relevant content could be made for the final user.
  1. It would be possible to reduce fraud in programmatic advertising, i. e., that which is carried out through the use of software to buy digital advertising spaces. The blockchain would solve the problem of the insecurity of knowing if the ads are really being seen by real people or the clicks are real, the blockchain registers all the impressions.
  1. It would also benefit in creating a white list of websites on which to advertise. Advertisers would know which sites are trustworthy.
  1. Lastly, as there is a decentralized and public database, since everything is not centralized, advertisers and publishers have direct access to know where their ad impressions and clicks have occurred, when and how, they would ensure that the data of the users and the clicks are real, this would also eliminate fraudulent clicks.

Blockchain, The Missing Link in Digital Marketing

In short, this system or platform will be important because advertisers (brands) or agencies will have access to highly valuable data to plan their campaigns or strategies. Until now, they do not have data about what percentage of what they invest goes to intermediaries and what percentage goes to the user contacting the messages they send.

If all those involved in digital advertising: brands, agencies, digital media and users are connected to the same blockchain to know all the intermediaries involved in the contracting of digital media and all the transactions that occur, advertisers will end up with more confidence in the media and therefore in digital advertising.

No one will doubt that advertising brands will want to know all this data with transparency and security and know which actors participate in all transactions and what functions each one has.

Blockchain has the potential to dramatically impact customer experiences, but its successful implementation will largely depend on how companies harness the technology to reinvent touch-points in the customer journey. They will need skilled blockchain labor, and this labor will form the marketing platform of the future.

Undoubtedly, this blockchain is going to change the way of doing digital advertising, it will surely open up new paths and opportunities for agencies.

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