Blockchain For Advertising Designed To Streamline Industrybr>
The shine on the buzzword “blockchain” has recently been tarnished by the associated tie with the tokenization of many blockchain implementations. The rise and fall of prices associated with the assets are commonly compared to the dot-com bubble or even tulip mania and may cause followers to think of blockchain itself as unstable. The absence of global regulation over the trading of cryptocurrencies results in volatility, which creates short-term money-making opportunities for trading these assets. The flurry of trading activity attempting to capitalize on the market further perpetuates the volatility. Unfortunately, the underlying blockchain protocol technology and underlying distributed ledger technology or DLT) is unfairly implicated in the process.
A white paper from market intelligence firm Advertiser Perceptions entitled “How Blockchain Can Solve Today’s Digital Media Challenges” was released last week highlighting an industry that is in desperate need of transformation. This paper was generated from survey data from 300 advertising decision makers.
Currently, digital advertising is a $224B mess of an industry, preyed upon by middlemen, fraudsters and other parties who siphon off media spend at a total projected cost of $22B by 2020. Fraud is largely a causal effect from a lack of transparency and an over-complicated landscape. According to the research, “nearly 7-in-10 advertising decision makers indicate that inefficiency, lack of transparency, and inaccuracy in the digital media supply chain” are what is wrong with digital advertising. Addressing these deficiencies is exactly what blockchain stands to do, and more than 50% of the survey participants are bullish that it will.
The industry also faces a massive data discrepancy and reconciliation problem between vendor data supporting common advertisers. Buyers of digital media leverage multiple third parties to validate what they’re receiving from sellers, resulting in conflicting sources of truth when it comes to what audiences are targeted and the ads that are trafficked, viewed, and attributed (and ultimately paid for).. Additionally, there is no standard method of billing or campaign reconciliation for all parties to reference. The survey data showed that over 40% of marketers experience issues between first- and third-party numbers, with only 1% stating they’ve never seen issues associated to discrepancies.
When it comes to actually applying blockchain to digital advertising, the research showed that “just 1-in-10 marketers has executed any ad buying using the technology.” This isn’t surprising, as very few blockchain solutions have been released for use, and the technology hasn’t yet been embraced or adopted. I would argue that this would be a similar statistic to the number of users employing the SMTP protocol to communicate electronically (SMTP is the open protocol for sending and receiving email over the internet) in 1995. This 10% number shows a massive opportunity for advancement and innovation in an industry that is desperately in need of a standard protocol for all types of advertising buying/selling.
The benefits of transparency, security, and efficiency that industry specific blockchains (like that of XCHNG for digital advertising) can offer – outweigh the current skepticism as a result of token volatility. An integrated architecture that suits the needs of an industry and ties supply chain feedback loops (discovery, transaction support, and traceability of transactions) is the winning combination to make blockchain technology usable at scale in industry.
About Charles Manning
Charles Manning is the founder and CEO of Kochava, a mobile attribution analytics platform serving tier-one advertisers worldwide. For nearly 20 years, Manning has been creating technologies that use data for system optimization, ranging from business service management (BSM) to information technology (IT) to attribution analytics, and most recently blockchain. Prior to founding Kochava, Manning founded PLAYXPERT – which started as a gaming technology platform. After licensing the PLAYXPERT technology to Razer, Manning built a team that focused its time on building engagement platforms for entrepreneurs and agencies. Upon realizing that there were no standard platforms providing effective attribution or post-install analytics in mobile – Manning and his team built one, and Kochava was born.