The Shakeup of Digital Advertising
2017 turned out to be the “year of the bitcoin.” The cryptocurrency enjoyed huge price swings, or suffered, depending on your point of view. It was a wild ride and along the way, bitcoin dragged the concept of alternative, non-government currencies and also blockchain technology into the mainstream. While bitcoin ate up most of the headlines, blockchain may actually prove to be the more revolutionary breakthrough.
Blockchain is one of the fundamental technologies that make bitcoin possible. The full story is complicated, but blockchain essentially allows processing to be easily distributed among a large number of computers. Verification and validation systems ensure that the computers are working in sync and that they are actually getting the work done.
For example, bitcoin is based upon a huge public ledger that records every transaction ever conducted, but there is no central server managing and processing this public ledger. Instead, the bitcoin community as a whole maintains the public ledger through the blockchain. If you’re having trouble visualizing the blockchain, think of it as a massive excel sheet. Now imagine that excel sheet being put up online so multiple parties can crunch and verify the data.
Now digital marketers and the companies that serve these marketers are exploring ways to apply the blockchain to marketing, including but not limited to digital advertising. So far, the early efforts and results have been very promising. Blockchain could potentially revolutionize the marketing industry as a whole.
Take MetaX, for example. The company created an “adchain” that can be used to tag a creative work, say an ad, and then follow its journey on the Internet. Through the adchain, marketers can see who saw the creative work, where they saw it, the conversion rate, and a breakdown of the budget through the whole journey.
For MetaX, the big breakthrough came from a non-bitcoin currency, ethereum. This currency is one of the largest alt-currencies and importantly, it’s also built on an open-source blockchain platform. This allows developers, such as MetaX to use the basic platform to develop new applications, such as an “adchain.”
Countless companies are using various tracking tools to measure impressions, conversions, and all the rest. Quite frankly, handling all the data can be a hassle, especially for end users trying to put it all together to develop a holistic analysis. Collecting all the data and acquiring all of the processing power needed to analyze it can be difficult.Fraudulent ad impressions, clicks, and interactions are a real risk that blockchain could eliminate. Click To Tweet
However, the blockchain, and in this case the adchain, will allow multiple parties to both contribute and process data. This reduces the burden on any one party. With adchain, this is accomplished by adding a tracker directly to the XML of the creative asset being tracked. Then, in real time, you can see who is watching the ad. You can also discover if viewability standards aren’t being met.
Let’s illustrate an example of the adchain. Say a buyer buys an impression and this impression is encrypted in a block. Then it is broadcast to the participants on the blockchain and the impression will then be verified by the publisher and added to the ledger. Now, everyone on the blockchain can see the impression event in the ledger and can then approve it.
One of the most important aspects of the blockchain is its ability to prevent fraud. Bitcoin scams have happened, but none of these events have ever threatened the integrity of the blockchain itself. Fraudulent ad impressions, clicks, and interactions are a real risk, especially at the transactional level, but with blockchain technology, these risks could be mitigated if not eliminated.
So yeah, blockchain is a big deal for marketers. It’s not just startups and bleeding-edge companies that are investing in blockchain and marketing applications, either. NASDAQ recently launched its New York Interactive Advertising Exchange. This advertising exchange is built on blockchain and allows for “smart contracts.”
These contracts allow you to make exchanges and in combination with the blockchain, the contracts can be executed automatically once certain conditions are met. This allows for buyers and sellers in the advertising sector to more quickly move assets, while also ensuring the integrity of the work itself.