By 2021, marketing budgets for advertisers in the US is set to reach $120 billion collectively. To cut a long story short, the online ad world is booming. In fact, we can barely take a step (or a click) on the web without coming face to face with an ad.
Advertisers now have access to mammoth amounts of data to make smarter, more informed decisions and to serve consumers highly-targeted ads based on their past behaviors and actions.
It’s quite phenomenal, really.
Who’d have thought that, ten years ago, the online ad industry would be this versatile, this in-depth, and this targeted? Very few, probably. And this makes it even more difficult to predict what’s going to happen in the next 10 years (or even the next 5 years at the rate that technology is evolving today).
Each time the online world has been teetering on the edge of a new online technology (think email in the 90s and social media in the 00s), we’ve jumped to the conclusion that this will be the thing that will change the digital world forever.
Which brings us to today, where – you guessed it – we’re on the cusp of yet another mega transformation in the online world. Brace yourselves, because things could change forever (or, you know, things might change for a little bit but then we’ll get used to it and it’ll be the new norm).
We’re talking blockchain technology here. If you’re under the impression that this new technology is reserved solely for the likes of computer nerds, crypto-miners, and those who are bats about Bitcoin, you might want to have a rethink.
The Problem with Online Advertising Today
We can’t look left or right without bumping face-first into an ad for a product we literally just added to our basket and then left there to gather dust, but the online ad world isn’t devoid of any problems.
It may well be the best way for brands big and small to reach new audiences and better connect with their favorite fans, but there’s a pretty big catch that’s becoming even bigger by the day: it’s getting less and less secure and authentic.
What started out as a potentially small niggle is now a major concern for brands as we enter into an era where consumers are more sensitive than ever about what happens with their data.
Huge security breaches and data leakages have made people all over the world incredibly suspicious of advertisers – and rightly so, because the online advertising world has a very large fraud problem.
According to a recent study, around 7.6% of all display ad impressions in 2017 were fraudulent. On top of that, online marketers have lost around $6.5 billion over the last few years in ad fraud (that’s about $1 out of every $3 spent).
It’s safe to say something needs to change.
The Most Important Benefit Blockchain Has to Offer
Cue the shiny new blockchain technology which, if we believed everything we read, is galloping in to save the day in every digital vertical.
Its transparent verification process and the permanent nature of its records mean that it has two huge benefits to offer the online advertising world: visibility and authenticity.
But how will this really affect online advertising?
How Blockchain Will Change Advertising for the Consumer
For lots of consumers, the online ad world could do with a massive overhaul. It’s sometimes creepy how closely we’re being stalked by brands on the net and how well they seem to know our browsing habits.
Which means blockchain could be great news for those who regularly get freaked out by targeted ads.
The most prominent effect blockchain will have in the immediate future is on digital display advertising, which makes up a major part of all advertising activity.
At the moment, the advertiser and the consumer kind of meet in the middle with ads served up by big-names like Facebook and Google. These intermediaries hold all the power, from consumer data to cost-per-clicks and everything in between.
With blockchain, this could be turned completely on its head. In fact, consumers could actively earn money by being served ads – mind-boggling, right?
Instead of Company X handing over their cash to Google to serve up relevant ads to people based on tentative imprints, they can instead pay the consumers viewing the ads directly.
This might make the creepy nature of targeting online advertising an easier pill to swallow for consumers if it comes with a side of money.
But then there’s still the problem of how intrusive ads are (did we mention it’s near-on impossible to venture anywhere online without walking smack-bang into an ad or five?).
These ads, particularly when viewed on mobile, drain batteries and waste bandwidth. Not cool when we don’t even choose to see them.
Again, blockchain could change this.
There are already solutions and software that allow consumers to “opt in” to viewing ads which they can choose based on the type of content they actively want to see. This means advertisers get a more insightful look into the kind of ads consumers want while the user gets served fewer ads that are of a higher and more relevant quality.
How Blockchain Will Change Online Advertising for Advertisers
On the flipside, blockchain has plenty of benefits for advertisers too.
In fact, it might even empower advertisers because they will be able to verify that every single user is 100% genuine. As a result, they’ll only be charged for genuine, authentic click-throughs and not waste every $1 in $3 on fraudulent impressions.
The visible nature of the blockchain ledger means that advertisers will also be able to confirm that a consumer definitely viewed an ad before any money is exchanged.
On the data side there will be some pros as well. Blockchain looks set to make online advertising more efficient because it will enable advertisers to create and beef up customer profiles from information that customers are freely sharing around. This, in turn, will help them serve even more relevant ads which will ultimately boost conversions and sales.
Is the New Online Advertising Landscape Here Already?
In short: no.
Although it’s easy to see the benefits that blockchain could have on the online advertising world, all of this is pretty much hypothetical at the moment.
Blockchain exists and is working wonders in many industries, but big-names like Facebook and Google don’t have anything to worry about just yet when it comes to taking a large chunk of the advertising pie.
In fact, Google has announced that it’s working on its own blockchain for cloud and transactional services. This means the whole industry is starting to rethink and act on a new advertising model, where blockchain could become top-dog all around thanks to its ability to build deeper relationships with consumers.