FAB Use Case: Digital Advertising

In this series, we tackle different potential use cases of Fast Access Blockchain and how we can build a better world through our solutions.

  • Involve multiple organizations
  • Where trust is key, or trust is presently severely eroded
  • Proof is key
  • Involve exchange/transfer of assets or value
  • Involve data sharing or presently suffers from silo’d data
  • Benefit from micro transactions/streaming
  • Have opportunities for new business models, products or services

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The last few years have seen an enormous swing towards digital advertising, as traditional print, radio and TV media are facing rapidly declining audiences. However, the old adage of

“50% of your advertising budget is wasted, the problem is you don’t know which 50%”

is unchanged, even with the advanced analytics that digital advertising provides.

Actually it’s worse than that.

Industry estimates put the cost of ad fraud anywhere between $7 billion to $16 billion a year globally. This money is paid out mostly to content publishers and channels that use bots, methbots or other fraudulent methods to artificially inflate clicks, impressions, tweets, likes, followers etc. to boost their revenues. With programmatic buying the occurrence of ad fraud is even higher as humans are taken out of the loop in deciding ad placement channels.

Entire organizations that have no legitimate purpose but to generate revenue through ad fraud have proliferated. Therefore all of that money is spent on ads that nobody has ever seen, let alone a person that was in the intended target audience. It is very sophisticated and very hard to prove that fraud occurred as false data can be manufactured any number of ways, and any real evidence evaporates into the ether in an instance. It is so profitable that content publishers and channels are in no hurry to provide any level of transparency to show that the placed ads are reaching intended real people.

Additionally, even when no ad fraud has occurred, it can be hard to come to an agreement between parties. A platform could have a different number than the publisher and the advertiser. Before anyone is paid, a consensus would have to be reached of the metric that would be used.

Again we see a recurring theme, an intermediary with eroded customer or public trust, just ripe to be disintermediated or disrupted by a blockchain application. Blockchain based solutions in this space are still nascent and primarily arm-waving arguments without much substance as there are a lot of complex technical details.

We do know however, that the basic proven characteristics of blockchain applications in providing an immutable, transparent and therefore audit-able ledger of transactions (or impressions, view, clicks etc. in this case), that is not under the control of any one or group of entities, can be a powerful tool in the war against ad fraud.

Further down the road, once the FAB network is fully operational (currently the foundation chain is operational, with miners), we will see scalable speeds for users and organizations which would allow real-time features such as processing digital ad transactions in real-time. Smart contracts would collect the daily clicks and impressions and initiate payment through pay-as-you-go or at the end of an ad campaign. This has the ability to lower the cost of advertising by getting rid of costly intermediaries.

A big area for gains is also in data management and analytics. Currently, there is no way for businesses to share their data with each other without losing possession of it.

Marketers would greatly benefit from a data sharing blockchain where they can receive coin as an incentive for sharing data with each other. This would create more full data sets, better targeting, and ultimately more effective media plans.

Some have suggested a completely new paradigm using blockchain to pay actual prospects and customers for attention using cryptotokens. The change to this may be initiated by consumers who are increasingly concerned about cookies, trackers and other sophisticated methods used to continuously micro-invade their privacy. Mark Zuckerberg, CEO of Facebook recently went in front of the United States congress because of the dangers the vast amount of data Facebook collects on users, their friends, and even those who do not use the social network. Data aggregators have access to more tools than ever to mine our personal data and sell it to third parties, who could use the insightful information into the way we think for nefarious purposes.

Given the choice, consumers may simply move to browsers, platforms and applications that operate in this new paradigm of openness, trust, and transparency for all parties. Many projects, such as Bitclave, have already started to appear that require advertisers to pay users in coin if they want the user to view their content or provide data. Users will be able to reap the financial rewards and track the initial point where they have given over control of their data.

Eventually, concepts such as secret contracts (where encrypted data is given which can be analyzed but not decoded) will start to become reality and allow for lifetime tracking of data and information.



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