Digital marketing in the Blockchain Era (Part 4): The ZoidCoin Solution

“Meaningful innovation does not need to be based on outright invention. Rather, there is an exhilarating shortcut. It is based on bold, new combinations of already existing components that simultaneously unlock heightened levels of consumer value and reduce costs.” (Gabor George Burt)

Our goal is to create an advertising platform that combines search marketing with demand generation: by making use of game theory, and of supply and demand mechanisms, the platform creates an environment that is fair to both buyer and seller.

As previously stated in the “Market” chapter, we find that there are three big problems the industry is currently facing: rewarding the users, cutting out the middlemen, and maintaining focus; we also need to drive adoption. Completing our goal is solely dependent on solving the four issues. We have explained our solutions as follows:

1. Rewarding the Users

Due to having their screens full of ads for a very long time, users are immune to most types of ads, they almost completely ignore sidebar banners and pay little attention to in-line ads. Most of the user attention goes to the very expensive video content, but this is a solution only big brands can afford. The reason for the extreme costs of grabbing user’s attention comes from the concept of grabbing itself, which implies that the users do not want to give their attention, so efforts are made to grab it.

We are building a system that rewards users for their attention so that they offer us their full attention instead of us grabbing it.

Users are rewarded with Zoidcoin (ZCN) for allowing us access to their data, interacting with the platform and final conversions.

1.1 Allowing Us Access to Their Data.

User data is the fuel of digital marketing and we think it is only fair that users get rewarded for their data. They should be able to choose how much data they share with us so we have created three types of users: BASIC, ENHANCED, and PRO. They are classified based on the level of data they share with us, the level of interactions with ads, and final conversions.

Users have to complete a KYC process because our tokens are exchangeable on the open market: this ensures that our data is accurate and that no bots can take advantage of our system. The platform can even offer travel deals so the KYC is essential for a streamlined purchase process.

BASIC users fill in the mandatory KYC data and also some basic demographic and interest data. ENHANCED users give us a better insight into their desires as consumers: brands they like, products they wish to buy, and places they want to visit.

This allows us to create the best possible deals, offering people the opportunity to become PRO users by making final conversions (purchases of any kind). There are one-time rewards for becoming a BASIC user and rewards each time a user levels up (from BASIC to ENHANCED and from ENHANCED to PRO).

1.2 Interacting with the Platform.

Our goal is to lower the overall costs by making advertising more efficient. This is a long and hard process that requires the effort of all the involved stakeholders: the buyers, the sellers, and the platform.

Ads that don’t convert increase the overall costs for everyone so users are rewarded when they give feedback on ads. They can inform us that they no longer want to see a certain brand or model or maybe they are not interested in a certain travel location. The ads come as a response to the user made data profile, but people change their minds all the time and we don’t want users to see ads they no longer care about as much as we don’t want advertisers to spend money on ads that the people do not want to see.

Users are able to create wish lists where they can choose a product, service or destination and the estimated time period or purchase. This gives the sellers the insight on what to offer the users. Those sellers that grant the wishes of the buyers by making a special deal for a specific product, are also rewarded — for example a limited number deal just for the users with the product on that wish list. All this effort helps us, the platform, know what the users want, thus seeking to create partnerships with new sellers and accelerating adoption.

Interaction-based rewards are earned according to the user type. For the same actions, the PRO user is rewarded more Zoidcoin than the ENHANCED user, and the ENHANCED user more Zoidcoin than the BASIC user. Our hope is that all of our users become PRO at some point.

1.3 Final Conversions.

In our wording, we alternate user with buyer and business with seller: this is because without final conversions, our final goal of making advertising more efficient cannot be reached.

Users are not here to socialize, and businesses are not on the platform to share political views: the sole purpose of our platform is to match buyers with sellers in the most cost-efficient way. Just think of us like the Tinder of buying and selling.

We want our users to convert in a short period of time. This makes the administrative job a lot easier for the sellers, thus driving the prices down, even externally. We have set up time-based conversion rewards, so we encourage our users to use their earned or bought tokens.

Our micro economy is set on blockchain, so all the transactions are forever transparent and this allows us to track conversions perfectly. Businesses advertising on the platform have access to the data and therefore helps them adjust everything to make purchases of any kind as swift and as cheap as possible for all parties involved.

Both buyers and sellers are considered users of the platform, therefore the companies are also rewarded when purchases are made. We’ve detailed this in the “Cutting out the Middlemen” section of the whitepaper, below.

2. Cutting out the Middlemen

It is very difficult to make good performing ads on the large platforms because the advertising rules and the ads manager change drastically and at a fast pace. In the current bidding system, the higher bidder wins the right to display the ad at the desired moment. This system favors large companies who employ middlemen to offer them insights about the industry’s bid levels, allowing them to have better performing ads than the smaller businesses.

There are still people who achieve great results in these complicated systems, but at a great cost. These are the middlemen we want to cut out. To achieve this goal, we will develop an easy to use ads manager, a simple set of rules, and a meritocracy-based ad display system.

This allows businesses to make their own ads without impacting the user experience in a negative way.

2.1 The Ads Manager

Businesses registering on the platform fill in details that allow us to sort them by industry. We will create ad templates by researching industry’s best practices for each of the industries that can advertise on the platform.

Each of these sellers has access to the category-specific ad templates, allowing them to create great ads by filling in the required text and images without having to worry about the layout.

Users see ads based on their requirements, and as we already have their attention granted to us, all we need to do is feed them an easy to grasp value proposition in a simple and clean ad format.

We will help businesses learn how to make great performing ads on our platform with industry specific step by step tutorials.

2.2 Advertising Rules

Form rules are required to maintain a high user experience standard, while content rules are all about avoiding malicious content.

Form rules are logical and straightforward. For example, the ads need to be simple and look good, therefore the maximum number of characters for the text will be low while the required resolution for the photos will be high. A good example of this method working is Twitter’s character limit.

We use text and image crawlers to ensure that content rules are also met. Using game theory, we remove the bad actors, and this allows us to create simpler rules without the fear of a bad user experience.

Since our users are rewarded for giving feedback on ads, they are the actual judges of the more controversial ads. Businesses are required to keep a number of tokens at stake so that if they breach the rules on certain aspects (unrequited nudity, gore, etc.) some of their tokens will be sent as a reward to the users who have reported the ads. This makes the seller less likely to risk breaching the rules and more likely to follow our guidance.

2.3 The Ad Display System

The whole point of Zoidcoin is reducing costs at a macro level through efficient advertising so clearly the current “highest bidder wins” model used by other platforms is not a solution. Users currently suffer from ad fatigue because they are being constantly spammed with ads: this results in them ignoring most of the ads. Our goal is to find the perfect balance between the number of displayed ads and end conversions.

For this to happen we seek to place three major advertising variables in perfect balance: ad placement, ad frequency, and ad quality.

2.3.1 Ad Placement

Ad placements vary in performance. For example, sidebar banners have an average click-through ratio (CTR) of 0.05%, while the average CTR for Facebook ads varies from 0.6% to 1.6% depending on the industry. This means that for every 1000 ad displays you will get 0.5 clicks from sidebar ads and between 5 and 16 clicks on average for Facebook ads. Combine this with an optimistic 50% average bounce rate and the result is 0.25 clicks from sidebar ads and from 2.5 to 8 clicks from Facebook ads, for every 1000 ad displays (impressions).

Multiply this with a very optimistic 1% end conversion rate and the result is outrageous: 0.0025 conversions for 1000 impressions on sidebar ads and 0.025–0.08 conversions from 1000 impressions on Facebook ads. Sidebar ads need 400,000 impressions for a final conversion while Facebook ads require between 40,000–12,500 impressions. The average CPM (cost per 1000 impressions) on sidebar ads varies between 0.10$ and 0.80$, this results in an end conversion cost between 40 and 320 dollars and this is no wonder since the ad was shown to approx. 399,999 people without a result. The average Facebook CPM in 2017 is 11.17$ (171% increase over 2016) meaning that a final conversion will cost between 139.6$ and 446.8$.

From this theoretical exercise it is clear that targeting 1000 people is still cheap and that the real cost comes from grabbing the user’s attention. Currently, the CPM trends upwards while the CTR continues to trend downwards as more and more users suffer from ad fatigue.

As previously explained, our system offers its users something in return for their attention and to maximize this, our ad is placed at a moment of maximum attention: the phone answer screen.

Whenever a user gets a call, a targeted ad is delivered to their call screen. For the brief period required for them to decide whether to answer or not, they see the ad. Once the call is over, the ad is visible again, this time with call to action buttons (Call, Navigate to location, Add to favorites, Contact details).

2.3.2 Ad Frequency

Ad frequency is the number of times an ad is displayed to a user over a fixed period of time. The rule of thumb is that everything above 3 is too much, however this doesn’t stop less experienced advertisers to reach frequencies of 30, thus increasing the overall advertising cost for everyone.

Our ads come up whenever a user receives a call and the user is rewarded with Zoidcoin for interacting with the ad. We’ve mitigated the click farm risk by making the KYC process mandatory for all users, although there is still a risk of users being bad actors. To avoid a scenario where a bad actor could call itself from other phones and farm Zoidcoin on the expense of the platform and the businesses advertising on it, we have fixed the maximum number of ads to be displayed daily. The maximum number of daily ads is calculated based on the average phone calls per day for the certain demographic.

Ads come as limited time offers so, if the user does not interact with it, the ad will never be seen again by the user. If the user interacts with an ad, based on his interaction he will see the ad a certain number of times before it expires.

The idea is to offer a good value proposition for a limited period of time to create scarcity increase conversions. Sellers will be able to offer great value with the help of the Zoidcoin Deals program, explained below in the “ad quality” section.

2.3.3 Ad Quality

For an ad to convert it needs a good form, a well-targeted audience, and a good value proposition. We’ve made sure that businesses make great looking ads by creating an easy to use ad builder with industry specific ad templates.

On the targeting side, we’ve assured that we offer the sellers enough data to target the buyers by implementing the user reward system for data sharing. This way, users are not only targeted based on demographics, but also on explicit needs.

We are giving the sellers all the necessary tools to make great ads and, by offering them step by step tutorials, we are making sure that they also know how to use them.

Quality ads are crucial towards reaching our goal of very efficient advertising and to make sure the sellers make all the necessary efforts, we have built an ad rating system. The sellers with the best rated ads pay less for ads, while the sellers with poor performing ads pay more and are therefore prompted with suggestions to improve their ads. We are not planning on making money from low performing advertisers since this is a zero-sum game and all the extra charges made from bad advertisers go to the high performing advertisers as advertising discounts.

The ads rating is calculated from internal metrics, user feedback, and final conversions.

Great looking ads and bullseye targeting will bring users’ attention but, in the end, the value proposition is responsible for the final conversion. We’ve tackled this matter, so to help the sellers we have created Zoidcoin Deals.

Zoidcoin Deals is linked directly to our core vision. Essentially, we are giving a high percent of the profit back to businesses so they can provide users with great deals, thus undercutting the competition outside the platform.

Simply put, businesses get a big portion of their ad-spend back so they can offer special deals to the buyers. If they choose to support the discount themselves, we reduce their advertising cost accordingly.

We make sure that sellers don’t make fake discounts by using price crawlers both in and outside the platform.

3.3 Maintaining focus

Our goal is to maximize efficiency to the point where Zoidcoin Deals allows sellers on the platform to undercut their competition outside the platform. Zoidcoin Deals is directly funded from the profit: put in a simplistic way, the profit is the difference between earnings and costs, so this means that we need to increase the earnings and decrease the costs. Our earnings come from advertising and in order to increase the earnings we need to charge more for advertising. However, this cannot be a long-term strategy because it defeats our end goal: to decrease the overall costs. We are therefore left with decreasing our costs to maximize the profit.

Our goal is to create an app that matches buyers and sellers in a measurable and cost-effective way. We stay away from more complex brand awareness content as it is less measurable and requires manual review to avoid malicious content.

Building an app with simple and clear use cases allows us to create step by step tutorials for all the scenarios and program chatbots to deliver the information when requested.

Using automation for the simpler tasks allows us to spend bigger budgets to employ the best talent for the most complex tasks, such as creating a micro economic system governed by smart contracts.

3.4 User Adoption

All of our above solutions are in vain if we don’t take into consideration driving user adoption. User adoption for such disruptive technologies is no easy task when you consider driving adoption beyond early adopters. We think it is very important to drive adoption throughout all the age spectrum, especially to the users that are usually laggard (the older generations).

Picking the “Phone” app to display our ads is no coincidence. We chose to have this display method because the “Phone” app is a bridge through all generations.

This app bridges the way different generations use their smartphones and becomes a common ground when they communicate amongst each other. This solution has proven to work in our proof of concept test with “Mobzoid”: a large portion of our user base is part of the older demographic.

With “Mobzoid” we have laid the foundation for real adoption by making partnerships with businesses that wanted to test this type of advertising while integrating our then centralized coin in their business processes.

A centralized coin posed many dangers. This why Zoidcoin is now on the blockchain. It has all the benefits of the blockchain: safety, fast transfers, listing on public exchanges. This take us closer to real user adoption and we are already having an easier time signing new partnerships.


The Zoidcoin Network makes buyers and sellers more aware of the consequences of their behavior in the market. Maximum conversion rate is achieved in a system where buyers are rewarded for offering sellers an insight into their buying needs and sellers are rewarded for fulfilling the said buyer’s needs. With the help of the blockchain’s transparency and immutability we can achieve an unprecedented level of accuracy in conversion tracking, and at a very low cost. Swift decisions from all the stakeholders in the market are the end of repetitive and inefficient digital marketing efforts.

As stated in the previous articles (1;2;3), this series is basically the whitepaper in a more friendly form, so if you wanna read it all in one piece, please head to our website.
 Join us to take one big step towards user privacy and fairly targeted advertising.

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