How businesses can use the blockchain for brands to connect with their customers.
What’s trending now?
The blockchain for brands. If 2017 was the year the crypto currency craze took off, 2018 will be the year the underlying blockchain technology goes mainstream. Blockchain network technology has the power to disrupt a whole new generation of business models, just like the internet did for publishing, media, music, and more in the 1990s.
This time, more middle men industries are about to meet their match. In particular, lawyers, bankers and, perhaps a little more surprisingly, advertising agencies are on the line. This is because the blockchain is all about direct peer-to-peer distribution.
Why it’s important
The key technology behind this next wave of digital disruption is the advent of blockchain-backed smart contracts.
Smart contracts, in simple terms, are self-executing, immutable agreements. Imagine buying a house and having it transferred instantaneously into your name the very second you make payment to the seller -no lawyers, bankers, or civil servants required. No physical paperwork, no risk of the seller pulling out of the deal. A smart contract executes both parties’ rights and obligations simultaneously.
You can apply smart contract technology to almost every business industry. The implications of the blockchain for brands is similar to the way internet technology changed the way pretty much every business on the planet works today, in one way or another.
The marketing and advertising industry is one of the more surprising industries set to experience the impact of the blockchain for brands.
Digital advertising fraud, or “click fraud” is rampant. Pixelate’s 2017 research shows 20% of pay per click conversions are fraudulent. FraudLogix estimates 50% of ad impressions served on Internet Explorer were to non-human traffic in 2016. In a world where publishers fake traffic statistics to inflate advertising rate cards, competitors maliciously click on ads to run up rivals’ ad budgets, and hackers and search engines employ bots to fake clicks and conversions on pay-per- click adverts to rake in revenues. Marketers cannot even trust hard-data reporting metrics to evaluate their return on investment.
Enter the blockchain for brands.
Blockchain technology is, in essence, a decentralised ledger, hosted, validated, and recorded for infinity on multiple nodes on a vast peer to peer server network. This revolutionary method of sharing information allows marketers to engage in true direct marketing for the first time.
This technology will allow marketers to bipass advertising platforms and media channels altogether. The blockchain allows marketers to pay consumers directly for their individual attention. Instead of paying a search engine per click on an ad, or paying a broadcaster to screen a commercial, the marketer will be able to send a highly-targeted message to a highly-targeted database (even down to a specific individual). In effect, the marketer can now pay a consumer, directly, for viewing or interacting with the ad. Conversely, consumers could insist they are paid by third party adverting platforms – such as Google, Amazon and Facebook – every time that platform accesses, uses, or sells that individual user’s personal or internet history data for any purpose whatsoever.
Some futurists have even gone so far as to suggest that giving consumers fair financial compensation for sharing their personal data with corporations could be a viable alternative to a universal basic income, as robotics, automation and artificial intelligence continue to erode employment levels and increase economic inequality.
At the same time, blockchain for brands technology can solve the pesky fake influencer problem for brands. Smart contracts automatically enforce obligations from all parties involved. This means brands can ensure an influencer only gets paid, for example, when the agreed upon amount of verified authentic followers interact with the influencer’s post.
Bitclave.com, is a decentralised blockchain based search engine going up against the mighty Google machine. Bitclave compensates users directly for their search history and adverting attention. Bitclave also lets users to decide which companies may access their personal data. This pre-empts the privacy-backlash trend heading towards marketers the world-over. Users earn CAT coins in exchange for their data. CAT is the custom crypto-currency of the Bitclave platform.
In 2017 Burger King created a blockchain-based rewards programme crypto-currency for its consumers in Russia. Customers earn one Whoppercoin for every Ruble spent at the fast food chain.1, 700 Whoppercoins will buy you a burger. You can exchange Whoppercoins with third parties on the blockchain, just like any other “conventional” crypto-currency.
The blockchain – coming soon to a browser near you.
Image credit: Toffannella