A Look At How Blockchain Is Transforming Digital Marketing
Due to the escalating budgets for ads and the ever-increasing complexity of the advertising landscape, digital marketing has evolved rapidly. Technology has enabled consumer demands, merchant business models, and advertising channels to evolve in the last decade.
Experts say, however, that digital marketing may once again undergo a transformation in the coming years thanks to a groundbreaking technology: blockchain.
Cryptocurrencies such as Bitcoin are normally associated with blockchain technology, but there are many more applications. Verifying both parties in a transaction and creating a permanent public record of the transaction has implications for all business sectors.
Blockchain is also expected to change the way businesses do digital marketing and advertising. Several of these changes level the playing field and allow small companies to have the same access to consumers as their larger counterparts.
Distributed ledger technologies are often associated with cryptocurrencies and financial instruments. However, the underlying technology has the potential to transform digital marketing. Let’s look at how:
Transparency and trust are promoted
In digital marketing, trust and transparency are the most valuable currencies. Ad-tech experts at The Drum discuss how these two issues continue to dominate ad-tech initiatives – resulting in a host of solutions that improve consumer trust and supply chain visibility. As public blockchains are essentially databases that are immutable and readily accessible to anyone for verification, they can be used to improve transparency in digital marketing. Indeed, it is the technology of the future.
Blockchain will enable businesses to reveal and eliminate hidden fees such as ad fraud, which costs them billions of dollars each year.
Ad fraud is a method of inflating ad costs by using algorithms and bots. Using blockchain, marketers can verify that ads were viewed by the intended audience within the allotted timeframe. Blockchain will help expose and prevent ad fraud, a problem that costs companies billions.
It cuts through the noise
Digital marketing is a data-driven industry today. As a result, digital marketing companies emphasize the importance of using accurate data to appeal to consumer needs. Nevertheless, fake news, click farms, and fraudulent practices obscure consumer data being collected from target audiences, making it more difficult to deliver valuable and personalized content. You can use blockchain technology to measure and demonstrate the effectiveness of various marketing campaigns, resulting in more clearly targeted ads and delivering better value to consumers.
Because metrics and data are stored in decentralized ledgers, you can continuously improve marketing campaigns without spending money on simulated engagement. The U.K. based Financial Times reports that fake clicks cost companies at least £4.8 billion in advertising every year.
Enhances data privacy
Data privacy has been one of the main criticisms of the industry. Recently, stringent data privacy laws have been passed around the world including the EU’s General Data Protection Regulation, South Africa’s Protection of Personal Information Act, the California Consumer Privacy Act in the US, the Data Privacy Act in the UK, and Brazil’s General Data Protection Law. In addition, there is an increasing number of data breaches appearing in the headlines, and digital marketing gets most of the flak.
Blockchain applications have the potential not only to help companies comply with these laws but also to safeguard consumer data in an unprecedented way. Using it, clients can see that only employees at an agency have access to customer data and that protocols are in place – without compromising data or adding additional complexity.
Cuts out the middleman
Consumer data isn’t directly collected and tracked by advertisers. Most marketers purchase data or advanced insight from their customer data from ad networks. Blockchain technologies allow advertisers to create their own networks and keep their customer data. After some time, advertisers will be able to access their customers’ data and track metrics directly from their audiences. This will improve customer loyalty and enable advertisers to build customized reward programs.
Getting better consumer information is possible for companies
People want to control their personal information, and they’re tired of signing up with company A and suddenly seeing advertisements from company B, company C, and company D.
The blockchain will give consumers the option of charging for their contact information and will ensure only reputable businesses have access to it. It may sound bad for business, but in fact, it’s great – instead of wasting money on uninterested people, you’ll get targeted, accurate information from people who are actually interested.
Blockchain’s use in digital marketing will continue to grow, as will investments in ad-tech. According to Venture Beat, the blockchain industry has grown 13 times in 18 months.
In total, there are now 290 blockchain projects and companies that are developing use cases across various areas of digital marketing, such as content marketing, social media marketing, and e-commerce.
While we at Digital Papercuts are not yet using it, just as with all new technologies and developments in digital marketing we are looking at it and analyzing how we can incorporate it into our client’s programs.