While the industry is divided on the use of
blockchain in general, thanks to cryptocurrency, there’s no question that it
has plenty of promise in digital marketing.
Though blockchain got most of its attention from
Bitcoin, there’s much more to this technology than cryptocurrency. Blockchain
provides a method of digital record-keeping that keeps a ledger of transactions
that is transparent and can’t be altered, providing more security than other
technologies.
The many advantages of blockchain have already
led to its implementation in several industries, notably in finance and
healthcare, but it holds a lot of potential for digital marketing.
Find out how blockchain could affect digital
marketing and what benefits it holds.
What is Blockchain?
Blockchain
is an
electronic public ledger that can be openly shared among separate users,
creating an unchangeable record of transactions. Each transaction has a
time-stamp and a link to the previous transaction, so it’s impossible to alter.
Each digital record or transaction is called a
block, and it allows either an open or controlled group of users to participate
and alter the electronic ledger. It can also only be altered or updated with
agreement among all participants, and once new information is entered, it can’t
be erased. As a result, a blockchain has a true and verifiable record of every
transaction that ever existed within the system.
Blockchain is also without an administrator,
since the blockchain users are the administrator. Blockchain ledgers can be
managed autonomously to exchange information between parties, much like
collaborative software or a peer-to-peer network.
Though blockchain is often called a technology,
it’s more accurate to refer to it as an architecture creating an unchangeable
ledger of transactions.
Data Collection
The internet is accessible to anyone through
ISPs and web browsers, the two gatekeepers. Both of these record and analyze
all our online behavior to gain insights about us and apply it to our online
searches and future marketing efforts.
Unfortunately, these gatekeepers don’t always
offer fair and ethical access to the web, and the recent headlines have proven
our personal data is easily bought and sold.
This is where blockchain comes in. With a
network built on blockchain-verified signatures, your data stays with you. This
is in stark contrast to it floating around servers which are owned by the
application you’re using, such as Facebook. With this network, visiting a
website would allow you to keep your own personal information, without
contributing to a running log of the people who also visited the website. As a
result, all your personal information will be encrypted and protected.
While this is a great thing for individuals, it
can be scary for marketers. Without access to user data, marketers would need
to gather data directly from prospects and customers to get a full picture of
the audience.
User experience could change too. Though you
should already be putting a lot of effort into user experience now, blockchain
could offer the opportunity for users to voluntarily decide which content and
advertisements they want to view.
Digital Display Marketing
Online display ads are riddled with flaws and
problems, regardless of whether some businesses see results. For a marketer,
online display ads can be expensive, complex and difficult to manage, and the
inventory is controlled by Google and Facebook almost exclusively.
The problems that arise from digital advertising
in terms of user experience are well known. Display ads are disruptive,
intrusive, irritating and waste your battery and bandwidth
.
However, a blockchain browser with a Basic
Attention Token (BAT) can fix all the issues with ads. By trading on the value
of online attention, blockchain can incentivize users to view content and break
up the monopoly on digital ads.
It works like this: marketers buy ads with BAT,
which are found in private tabs or landing pages. Users who choose to view ads
are compensated with BAT, so they’re only seeing the ads they want to see.
As a result, marketers get more accurate
consumer information, and users get to learn about only the brands they choose.
Users also receive a portion of the marketer’s BAT in exchange for their
attention.
Publishers are also compensated by both users
and marketers through the revenue-sharing program. Publishers receive a higher
portion of the ad spend than the users, however, and may choose to charge BAT
for premium subscriptions and content.
This is really a win for everyone involved.
Marketers get more accurate, targeted data to tailor future campaigns,
publishers earn revenue and control over the message, and users get only the
most relevant ads they actually want to see. Users can also do so without
risking their personal information.
Just like buying a subscription to a print
publication you wanted to read in the past, BAT shows the value of a user’s
attention and puts them back in control.
Privacy and Trust
Privacy and brand trust are two overarching
issues in the digital world, which leads many users to become skeptical and
discerning about who they give their information to.
Giving users control over the amount of personal
information they reveal lowers privacy concerns from the user perspective, as
well as promoting social responsibility from the marketer’s side.
Caring for your user’s data and privacy are
important anyway, so putting effort into improving any shortcomings should
already be on your to-do list. With blockchain, however, the businesses that
prioritize user privacy will become more apparent and earn more trust from
users, building your brand relationships.
On top of that, studies show that users are more
willing to voluntarily provide personal information, with permission, if
there’s a reward for their trust. If you’re paying users directly to view your
ads and content, you’re more likely to get their information and continued
support in the future.
Ownership and Security of Assets
Piracy was a problem in the past, which led to
sites like Pandora and Amazon Music, Unfortunately, artists are only
compensated pennies per stream, and the complexities of the music industry
meant that streaming service payments don’t always go to the appropriate
person.
With blockchain, artists, filmmakers, musicians,
photographers and other creative professionals have the opportunity to provide
their pieces to the huge audience without the use of an intermediary. They can
gain value for their tokens as they become more popular as well, earning more
for their work.
The downside for the marketer is that this would
give artists the tools necessary to market themselves directly to their audience,
without sacrificing their revenue. This would give artists a chance to be
valued for their work, however, and not because they know how to become a
corporate product.
Looking to the Future
Though these possibilities are very real,
they’re likely far off in the future. For now, we’re seeing blockchain in its
infancy and learning more about how it could have positive benefits for user
experience and marketing. With that in mind, it’s important to consider the
implications for the future.
One thing is for sure, however: right now, some
of the best minds in the industry are working on blockchain and cryptocurrency
to adapt it to different business models and industries, so there’s likely to
be a lot of development in the near future.