Technology

How Can Blockchain Improve Digital Marketing?

From data control to targeted advertising, blockchain delivers trust and transparency

Melanie Kramer Melanie Kramer March 27, 2020
4 minutes read
blockchain-improve-digital-marketing-BlockchainLand

Blockchain technology has long promised to start handing us back control of our digital lives, through decentralization and community control, right through to providing transparency of monetary and data flows. 

Blockchain has the potential to return data control to data owners while still enabling the targeted digital advertising that consumer brands rely on. Blockchain could improve both the impact of digital marketing and its opportunity to the consumer, while creating benefits and efficiencies to the businesses who spend fortunes on digital advertising campaigns. 

Giving control of data and earnings to potential to data owners

Early in blockchain’s emergence came its potential for handing back data ownership to individual data owners. Running parallel to blockchain development grew the concerns over illicit data gathering, data use and data breaches. Consumers began to realize their information was often openly available on the net or bought and sold for huge profits by businesses. 

Even in the most credible of uses, consumers give their data to brands, and brands use this to refine and target their product marketing. Targeted digital marketing allows brands to improve their sales dramatically. Even with consumers receiving ads relevant to them, this data collection is still often invasive. Add to this mix third parties which gather and broker data and have made millions from this activity, some of which is far less than credible. The consumer has lost control of their data and handed to these third parties the opportunity to make money from something that was never theirs. 

One vision of blockchain is that eventually, consumers may be able to hold a digital wallet of assets which includes their data, only sharing chosen items of data with selected parties and with complete visibility of data sharing permissions.

Blockchain development so far sees many individual projects, some of which use this model or variations of it. Some platforms allow individuals to select who views and uses their data and how, in return for a reward. 

Blockstack is building software where data remains in the hands of its owners but is used almost like a key to unlock specific applications. The data stays with the consumer and is locked back with the individual when they are done sharing it to access what they wish to. 

Another example, the Brave Browser focuses on allowing users to opt-into viewing only the ads they want to in return for cryptocurrencies called Basic Attention Tokens (BATs). 

Read more about Brave Browser here.

Blockchain for content monetization

Content is vital for marketing. Without billions of items of “content” posted on Facebook, the social media giant would never make its millions from advertisers. As audiences view content, they also see the adverts that surround it. Content promotes products and includes links to product and service websites. Consumers, as well as bloggers and streamers, create content regularly, but what if they could be rewarded, directly, for this activity rather than the content platforms or third parties involved in advertising. 

A number of platforms are emerging and growing, aiming to disrupt content creation and cut out third parties by rewarding users directly with crypto micro-payments for their content-creating activities. 

Content sharing platform Steemit, based on the Steem blockchain, rewards content creators with STEEM tokens. 

PodMiners is creating a blockchain solution for podcast creators where they can be directly incentivized for listener downloads and subscriptions. 

DLive is a new platform with no advertisers where users can buy Lino Points from the Lino Blockchain and pay them directly to the gamers and streamers they watch. 

Improving affiliate marketing and digital advertising campaigns

Affiliate marketing today often involves an affiliate platform, or other third parties, that offer the affiliate program for a brand to the end promoter or advertiser. Both the advertiser and the affiliate marketer pay a fee to the affiliate network. Though some are very credible, others have been accused of setting payment milestones too high, withholding payments or working with unscrupulous advertisers. Affiliate fraud also exists. 

Blockchain has the potential to link merchants with marketers directly providing transparency of data, clicks and interactions, preventing fraud and removing middle operators. Back in 2018, we looked at some blockchain projects in development to address the problems with affiliate marketing, including Attrace and RefToken. 

There are similar issues for brands running direct digital advertising campaigns. Right now, brands can see the effects of marketing campaigns but often can’t be entirely sure what efforts created a boost in sales. Data generated by digital advertising campaign analytics can be inaccurate and hard to verify, so improving a campaign or even identifying a successful campaign to replicate can be difficult. 

Fraud is a problem in digital advertising, bots, click farms and ghost web sites can distort the activity perceived from digital advertising. This fraud could cost the industry, and advertisers, around 10% of their total spend. Matthew Lieberman​, CMO at PwC U.S​. and Mexico recent wrote:

“With the help of blockchain, it’s now possible to track marketing campaigns in near real-time, with verifiable, trustworthy metrics.”

Lieberman also notes a measure that discovered as many as 23 participants could be involved in the digital advertising chain between ad publisher and consumer. As well as the cut taken by third parties, this chain increases the risk of data breaches and cybersecurity incidents as well as fraud and human error. Lieberman adds:

“One of the main reasons why blockchain matters to business is that it can more securely verify, store and selectively share data across multiple parties, thereby lifting trust.”

Read more on the Contributions of Blockchain to Cybersecurity.

A blockchain network can, for example, record authenticated digital outlets and test advertising measures like impressions against its registry to prevent fraud. Measurements can be verified to a blockchain with a timestamp and securely shared with only permissioned stakeholders. Add artificial intelligence, and its ability to identify anomalies, to this mix and digital advertising gains powerful tools that can cut costs and middle-operators and improve efficiencies.  

As an example, in practice, Toyota tried blockchain to reduce fraud in its digital advertising campaigns and was rewarded by a 21% improvement in website visitor traffic. 

Unilever is the world’s fourth-largest spender on digital advertising; it has become the anchor brand in an IBM blockchain pilot consortium. Unilever has been working with IBM on applying blockchain to improve digital advertising efficiency for a year. The overall consortium’s pilot, with Unilever, has been so successful the technology will move to full production and IBM expects to launch a widely available blockchain advertising solution later in 2020.

Adding trust and transparency

Brands and advertisers are discovering that blockchain truly can deliver trust and transparency for marketing and digital advertising campaigns. Projects and pilots that began over the past few years are finally coming to fruition and seeing plans, like IBM’s, that could be rolled out across multiple industries in the next twelve months. 

It’s not just businesses that will be able to profit by maximizing their advertising spend and minimizing costs. Consumers can now look to blockchain platforms that allow them to control their data and even allow them to benefit from it instead of advertisers and their intermediaries. Content creators too, can begin to take a direct reward in the form of cryptocurrencies for their efforts.

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Melanie Kramer

Melanie Kramer

Melanie Kramer is a freelance technology, blockchain, and cryptocurrency, writer and reporter based between France and Canada. Melanie has studied and retains an avid interest in, global politics, business, and economics.

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