Digital advertising has become a billion-dollar industry. It has even begun outperforming traditional marketing. However, digital advertising fraud losses are also in the billions, according to Juniper.
Some digital advertisers have begun considering blockchain technology to prevent further fraud loss. Blockchain addresses many of the common problems in digital marketing. Its inherent transparency and verifiability counteract the complexity and opacity of digital advertising environments.
What is Blockchain?
Blockchain is an open ledger system. Each transaction in the network has to be verified before it is accepted, and the new transaction is built on top of the transaction that came before it.
A blockchain system is supported through a network of nodes. New pieces of data are broken into pieces, which are stored across the network.
The way that blockchain works means that every user can see every transaction. No single user can erase or alter data, only amend it. It is inherently secure, verifiable, and transparent.
How Blockchain Helps Digital Advertisers
While digital advertising is an incredibly profitable industry, companies face common challenges. The majority of difficulty arises from a complex supply chain that does not allow for standardization. This makes it difficult to accurately measure an ad’s true impact.
Blockchain’s transparent nature addresses many of the common issues digital advertisers face. It allows for an open supply chain where companies can see exactly what is happening to their marketing.
With a clear supply chain, companies can enforce consistent metrics. They can instate straightforward measurements to see how well their ad performs.
Additionally, businesses can make sure that they are paying for real human interactions, not automated traffic. Their ads will be seen by users that can click through to become customers.
The Barriers to Blockchain
Even with all of its benefits, there are still some barriers to using blockchain technology in digital marketing. Primarily, blockchain requires collaboration. Many digital advertisers are fiercely protective of their data, as their data is their product.
To implement a blockchain system, companies would have to be convinced to work together. They would need to be able to trust each other, which can be difficult.
Blockchain has the potential to benefit digital advertisers, but it can be difficult to implement. The complex nature of the industry causes issues that blockchain can address, but those same issues can prevent the cooperation needed to implement blockchain.
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