Benefiting From Blockchain (Without Getting Burned)
The explosion of Bitcoin growth in the past two years signals the movement of blockchain technology from cyberpunk obsession to a viable part of daily business operations. Although still in the early stages of its life, forward-thinking businesses now have the ability to integrate blockchain into their infrastructure and workflow without disrupting their core company model.
This early adoption is a good future proofing strategy: given that blockchain is projected to have grown by $176 billion dollars in 2025, online marketers do well to follow in the path of giants like Microsoft, Overstock and Walmart by paying attention to trends, and working with business solutions offered by dozens of promising Blockchain startups.
Dodging the Hype Train
Blockchain adoption is currently undergoing a moment of scrutiny after the excitement of investors was manipulated by publicly traded companies such as Long Island Iced Tea, which grabbed a 500% increase in stock value simply by changing its name to Long Blockchain.
While it is still an emergent and experimental technology, gesturing towards blockchain with no real strategy or understanding of what it entails may seem like a good idea, but this is a shortsighted scheme. Nasdaq, for instance, called out Long Blockchain for its disingenuous tactics, earning the company poor publicity. Given the legitimate value which stands to be gained from Blockchain solutions, there is no need to ride a hype train destined to crash. Actual adoption is both viable and promising in terms of the advantages it offers to businesses seeking better ROI.
What Blockchain Is
There is a tendency to conflate the blockchain with Bitcoin and other cryptocurrencies. But while the two are closely related, they are not the same thing. Rather, Blockchain is the technology that cryptocurrencies depend on, and accepting decentralized payments is simply one of many possible applications.
In reality, blockchain is a ledger shared across thousands of users on a network and secured with encryption algorithms. Users can add entries to the blockchain, but cannot change or otherwise alter those entries going forward. This makes blockchain ideal for any applications where transparent logs of information are important.
In this article, we will discuss some of these applications, and how online marketers are poised to benefit from them.
Join us with Jeremy Epstein, CEO of Never Stop Marketing for a free webinar on preparing your business for the world of blockchain on March 27.
Better Digital Advertising
Digital advertising in its current form is undergoing a crisis. Not only do an increasing number of users employ adblocking software, but the costs of launching a campaign through an intermediary like Google or Facebook eat into a company’s bottom line.
Blockchain applied to advertising — sometimes referred to as adChain — seeks to address many of these problems, and is already making great strides. Going forward, businesses will be able to use adChain to:
- Efficiently track user engagement
- Skip intermediaries and advertise directly to an audience
- Avoid fraudulent adclicks in the form of bots and other malicious agents
- Segment an advertising audience more effectively through whitelisting
In 2017, the launch of the New York Interactive Advertising Exchange promised to create a space for brands and agencies to directly sell ad inventory with the aid of Blockchain. But while NYIAX is still in its pilot stage, there are already creative solutions available to digital marketers.
The Basic Attention Token (BAT) is a cryptocurrency based in the Ethereum blockchain. Its main purpose is to monitor user attention levels. By integrating BAT with an open-source web browser called Brave, its developers have created a way for companies to pay users directly for their attention.
Meanwhile, Papyrus also offers companies a decentralized advertising ecosystem that works through the exchange of tokens. Both services are well-worth the attention of businesses looking to step up their advertising gains with something different.
Transparent Supply Chain Management
For e-commerce companies especially, tracking the path of merchandise from producer to wholesaler to warehouse is an essential part of business. Not only does the journey of inventory matter for balancing account books, but it also plays into consumer trust, product quality, and business relationships.
Here, blockchain has already proven its worth as a system for unambiguously following merchandise from point A to point B, nearly eliminating the possibility of fraud, and making an otherwise intensive task painless for everyone involved.
Last year, IBM worked with Walmart to develop a blockchain-based solution for managing the corporate giant’s supply chain. The experiment was a tremendous success.
Right now IBM is working with Danish company Maersk to perfect the methods it employed with Walmart and other brands and create solutions that can span the industry.
In the meanwhile, platforms are already available for companies to integrate blockchain into their supply management system. The solution offered by Viant was recently covered in Fortune magazine, in a case study surrounding the journey of fresh seafood to consumers.
Improved Brand Authority
The central premise of content marketing is that a brand can build authority and trust by creating informational content that provides value to its prospects.
That’s how it works in theory. In practice, this system isn’t perfect: brands or individuals can build the veneer of authority across social media and search engines through SEO hacking, bots, fake reviews, and more. This can tend to bring the lowest common denominator up and the best down.
Blockchain-based content provides two huge advantages over the Internet’s current content ecosystem:
- Authors can be directly compensated based on the popularity of their work, and how it is read.
- The popularity — authority — of their work gains a 1:1 correlation with reader trust.
This is currently the model of the Steem blockchain, and the associated Steemit social media network. By reading and interacting with user-generated content, other users generate Steem tokens with a monetary value. The author receives these tokens directly as compensation, and other users get to see which content has more authority and which has less
Although still in its beta phase, Steemit currently ranks in the top 500 websites in the U.S, and according to some user estimates, is slated to become bigger than MSNBC in 2018. Decentralized content creation may be the most successful application of blockchain so far, second only to cryptocurrency; its popularity makes it a hotbed for smaller businesses who want a new platform to reach users who care.
Decentralized Payments
We’ve mentioned cryptocurrency several times in this article, because it is by far the most popular application of blockchain. The most popular of these cryptocurrencies, of course, is Bitcoin.
Many see Bitcoin and related currencies as a new investment fad, and not without reason. After the price of Bitcoin spiked in December of 2017, the Coinbase app — a popular Bitcoin “wallet” on iOS — reached the top of the App Store. Those who threw money into the digital currency hoping to earn a killing were likely disappointed when the value of Bitcoin plunged last month by several thousand dollars.
But for online businesses, Bitcoin is neither a ponzi scheme nor a golden cow. It is simply another frontier for forward-thinking growth which expands options for customers and builds market value. Online retailer Overstock.com currently accepts payments in the form of Bitcoin, Ethereum, Litecoin, and others. Newegg has opened this option to its customers as well, and e-commerce platform Shopify recently gave clients the option to accept Bitcoin payments.
There are good reasons to accept Bitcoin as a payment option. Not only has adoption occasioned a spike in sales across companies, but cryptocurrency is considered an asset by the IRS. It also grows like an asset: according to modest projections published in the Cryptocurrency Predictions Survey, the value of Bitcoin will stand at $33,000 by the end of 2018. This is more than 300% of its current $10,700 value.
Like all new technologies in their early life, blockchain is surrounded by speculation, confusion, sensationalism and experimentation. It’s important for businesses to adopt a realistic perspective, and seize the opportunity without getting lost in the noise. Ten years from now, blockchain will be ubiquitous; while it’s not, there are trails to forge and precedents to set. Those who begin now have an unprecedented chance that shouldn’t go to waste.
OMI is dedicated to helping small businesses navigate new marketing technologies more effectively, with practical education from experts across digital marketing fields.
To learn more about preparing your website for a future of blockchain technology, consider joining us for a free webinar with early Bitcoin adopter and marketing expert Jeremy Epstein on March 27th at 12 PM PST / 3 PM EST.
- Brandon Shutt, Editor at OMI
