The word is out. Not fully or easily understood yet by the average internet user or even by the more experienced of users, “Blockchain” is promising to be as impactful on those disciplines that veraciously do business on the internet as the original world wide web was on them just a few decades ago. Though not fully implemented, Blockchain technology threatens to eliminate the need for the traditional, centralized digital advertising distribution models and significantly improve the security of online information. It has the potential to give consumers complete control over their personal data. A decentralized data management and storage environment, blockchain technology promises to impact and disrupt current digital advertising giants like Facebook and Google.
Forrester has predicted that digital marketing expenditures in the United States will reach $120 billion by 2021. Any alteration in the current progression of those billions of advertising dollars flowing through middlemen like Google and Facebook has the digital marketing industry abuzz. The emerging blockchain technology uses a network of servers to transparently and independently verify the accuracy of user data, enabling consumers to feel confident that their data is accurate and factual and not being manipulated. Companies will be able to use blockchain to show consumers whom they are selling data to and assure them that information will not be tampered with.
A major point of contention for marketers has long been the apparent lack of transparency and accountability in being able to verify digital ad spend. Recent reports indicate that as much as 56% of all display ad dollars were lost to fraudulent inventory in 2016. The cost of ad fraud globally is expected to increase to $50 billion over the next decade. With a reported 79% of advertisers expressing concerns about the lack of visibility, many major brands are restricting their digital advertising budgets. Blockchain provides actual verification that sustainable, ethical, and responsible practices are being used and can make data-driven marketing more transparent by confirming that a targeted consumer actually viewed the advertisement, leading to a more precise digital attribution.
Consumers are being overwhelmed with too many ads, emails, coupons, and messages. This current “more mud against the wall approach” indicates marketers don’t have a single view about consumers that promotes cross-platform continuity. Studies have shown that between four and six ad exposures have the optimal impact on consumers’ propensity to buy. Blockchain can correct overexposure by providing an enhanced level of tracking and transparency that is not currently available through traditional digital advertising chains.
Universal adoption of blockchain technology is still a relatively long way from reality, but marketers should start digesting the wealth of information on the technology’s benefits and limitations. Digital advertisers should familiarize themselves with those companies who are pioneering the blockchain technology. Adoption of blockchain will be crucial to the development of future digital marketing strategies and embracing this new opportunity sooner rather than later will provide savvy marketers a head start in the next wave of innovation that promises to take the world of marketing to new heights.