For anyone new in finance matters, trying to understand blockchain can be quite tricky. The use of words like blockchain certification, cryptocurrency, and bitcoin, to name a few, makes it sound like something out of this universe. Many businesses, including those in the advertising industry, have seen the advantages of blockchain technology.
The use of blockchain in online advertising can make the sector more effective and efficient by cutting out fraud and increasing transparency.
What is Blockchain?
The simplest way to explain blockchain technology is to think about it as a digital excel spreadsheet. The blockchain is, therefore, a database which is in a digital ledger. The database is shared across a network of computers or nodes. Any time there’s a database update on the system all the nodes get the update automatically.
Blockchain is secure due to the cryptographic techniques that make it very hard for a hacker to penetrate. The more the nodes operating on the network, the safer it is. The only way a hacker can succeed is if he can penetrate more than half the nodes on the network.
When someone requests a transaction, it is broadcast across all the network nodes. The network validates, verifies and combines the new deal with the other existing transactions to form a block of data. The latest block then goes to the Ledger thus creating another block in the chain. Once it goes to this stage, it is permanent, public and no alterations are possible.
If you are interested in learning more about the basics of Blockchain, you can take a Blockchain course and master your skills.
Recent trends in the adoption of Blockchain
The popularity of blockchain is on the rise, and there are certain trends in the adoption of blockchain including;-
- Companies like IBM, Amazon, and Microsoft are helping businesses develop blockchain applications, by creating specific platforms for them. The result of this is that even those companies that do not have a lot of resources can now start incorporating blockchain into their operations.
- There is an increase in the adoption of blockchain in different Industries including insurance, healthcare, academics, gaming, supply chain management among others.
- The use of blockchain is transcending financial transactions to real-world cases. For example, the use of blockchain in supply chain management helps to prevent theft, because transactions are in the form of a digital ledger which does not allow for alterations.
- Start-ups’ are taking advantage of the growth of blockchain and end up disrupting the business sector. Their business models are inspired by blockchain, and they are therefore able to solve any challenges very quickly.
- Many governments across the globe including Canada, Thailand, and Switzerland are including blockchain in their processes. These include issuing passports, birth certificates, voting, and social service transactions.
- Blockchain players are developing consortiums to encourage collaboration, cooperation, and integration. The consortia will aid in the adoption of blockchain technology on a broader basis.
- There is increasing use of blockchain in online advertising thus greater transparency and accountability.
How Blockchain is a boon for online advertising
Online advertising is experiencing a boom; many companies are utilizing online platforms for advertising because of its ability to reach many people. However, despite its success, online advertising has several challenges, the most prominent being fraud.
Fraud has led to advertisers losing billions. There is a lack of transparency which comes from hidden fees, measurement, viewability, and traffic. Sometimes the fee structure is not very clear, and it is hard to prove value for money. Online advertisers’ need a secure way of doing business, and this is one thing blockchain technology can offer.
Blockchain will benefit the advertising industry by:-
Selling and buying of Media
To understand online advertising, there are three players; the Advertiser, the Middleman such as Google or Facebook, and the Consumer. It is difficult to place an advert online without going through the Middleman. But with blockchain technology, it will become possible to do away with the Middleman.
By using blockchain, some companies are already connecting directly with the customers by paying them to view ads. Blockchain will also confirm to the advertiser that someone has seen the advertisement before they release any payment.
Online advertisements can be very intrusive and honestly quite annoying. Blockchain will allow for better interaction with ads, by enabling consumers to choose the kind of content they would want to see.
Blockchain data will give advertisers valuable information from the customer data, thus allowing them to churn out higher-quality ads that consumers interact with.
Transparency and efficiency in online advertising
One of the ways that search engines make money is to get paid for any clicks on the customer’s website. However, there is no way to verify that the clicks are genuine. But, blockchain will help ensure that users are legitimate by empowering search engine markers.
Blockchain will give companies and ad agencies a valuable tool they can use to verify spend through the supply chain. They will get to see precisely which players are making commission, and what percentage of the ad spend went to the publishing houses for the display ads.
Blockchain will compliment yield-management, data targeting, and ad delivery. The players will, therefore, be able to track where the money is going, and whether there is any value. Anything that does not add value will no longer be part of the supply chain.
Blockchain will enable the collection and distribution of data that advertisers will use to build customer profiles. Advertisers can then use the information to come up with more relevant ads.
A report done by Deloitte shows that companies are no longer just exploring the use of blockchain technology; they are applying it to their businesses. The success of this technology in the advertising industry will depend on all the players embracing it.
It will not be long before this happens though because companies are embracing the technology, and will demand that any company they work with do the same. With billions of dollars on the line, organizations will demand transparency and accountability from the ad agencies. It would be a wise decision to go for blockchain training and prove your abilities in applying the blockchain concepts in the world of advertising.