Blockchain Technology Will Enable Accountability in Digital Advertising
The current digital advertising industry is horribly broken, but Blockchain has potential to fix it.
The irregularities in digital advertising have become a great concern, especially as every sector involved in the process is expressing one form of frustration or the other.
Participants are frustrated
Advertisers complain about not getting value for their money, since most of their ads do not reach their intended targets. Publishers complain of a revolt from their would-be audience who employ ad blocking software. Audiences complain of incessant intrusion and distraction from unsolicited advertisements. In short, there is palpable chaos in the entire digital advertising ecosystem.
The question of advertising effectiveness is critical to any business. The success, performance and profitability of many companies is directly dependant on it. This is laid out in PwC's Entertainment Media & Outlook 2017-2021, a comprehensive study containing forecasts for online and offline advertising markets for the stated period.
According to the report, the online advertising market will grow at a rate of 9.9 percent and will be worth $116 bln by 2021. This would make the digital advertising market more than 50 percent larger than TV advertising.
Setbacks in the industry
With the growth of the Internet, especially as mobile Internet has evolved, digital advertising has risen in prominence and far surpassed traditional media’s advertising systems. This rise in popularity of digital marketing has created to advertising models that allow publishers to earn money by generating traffic. This is the idea behind the pay-per-click system where publishers are rewarded according to the number of clicks or impressions on a given ad.
Not long after this system was invented, it began to be abused and cases of fraud became rampant. Today, non-human elements (bots) are engineered to register clicks and impressions on ads, deceiving advertisers who pay for impressions that are never even seen by human eyes.
Otherl setbacks include the fact that advertisers cannot determine the regions in which their ads are broadcast, especially when they are supposed to be targeted at specific audiences. The indiscriminate broadcasting of these ads by publishers has also given rise to the employment of ad blocking softwares by Internet users to prevent the interruption by such ads. More than 600 mln people are now using such tools, and this number is steadily increasing, while massive amounts of email advertising messages have resulted in recipients flagging them as spam.
Blockchain for accountability
As Blockchain finds its way into digital advertising, stakeholders are earnestly expecting that it will go a long way in enforcing accountability and will deliver improved results for ad campaigns. Blockchain technology will enable advertisers to disregard 100 percent of fraudulent traffic. Only actual “conversions” will be paid for, with all bot activity excluded. Advertisers will have authentic proof of service rather than the non-transparent systems that exist today.
Blockchain will reveal everything
In his book The CMO Primer For The Blockchain World, Jeremy Epstein, CEO of Never Stop Marketing notes that:
“Any industry that is full of intermediaries has a lot of value lost along the transaction path, and lacks transparency and trust is an industry that is ripe for Blockchain-driven disruption.”
He is not surprised that Blockchain-based protocols and technologies are seeking to upend how digital advertising is purchased, delivered, measured, and valued.
Epstein tells Cointelegraph that a decentralized ad tech protocol with independently verified actors whose behavioral attributes and reputation are built over time is going to, ultimately, give people the real transparency they need. This will enable them to understand exactly who is paying for the ad they are seeing and whether or not that individual or company is trustworthy. It will also reduce fraud and increase accountability.
Once today’s opaque advertising system is replaced with a transparent Blockchain-driven product, advertisers can rest assured that their budgets will be judiciously spent on actual impressions. Publishers will be able to do their jobs better and with less suspicion, as neither they nor their advertisers will be defrauded by bots, and regular internet users will see a marked decrease inbunwanted ads and unnecessary distractions.