Blockchain in Digital Marketing

Technology has provided businesses various methods to expand and blockchain is an example. Blockchain is a common term, however, when we hear the term blockchain what we think about is a cryptocurrency like Bitcoin, Ethereum, and the rest.

Blockchain is much more than that and can be implemented in different applications like the Internet of Things, energy, healthcare, business, etc.

Blockchain aims to change the course of marketing and advertising. How? What is the connection between blockchain and business marketing, and how can it be used as a tool for digital marketing?

This is what we’ll be discussing in this article, but first,

What is Blockchain?

In more technical terms, blockchain is a distributed and immutable ledger with growing lists of records (blocks) linked securely via cryptographic hashes. It is a digital diary that records transactions across many computers.

Let’s think of a group of friends making a bet on a football game. Depending on the team they support everyone has to pay a certain amount, and if a football team wins, the group supporting the winning team gets all the money contributed.

In this situation, everyone has a record of the bet, so when a football team wins they’re all aware of how much the group in support gets- this is not entirely how blockchain works, but, it gives an example of how transparent transactions are in a blockchain.

All the nodes running in a blockchain network have a record of every transaction that has ever occurred which is why it is termed a distributed system. In a distributed system, everyone keeps a record maintaining consistency, and if the record is updated, everyone is updated with that change.

The nature of blockchain is also immutable meaning it cannot be tampered with or manipulated easily. To expand on the immutability of blockchain, let’s consider these key pieces, such as;

Transactions: Transactions that took place when a block was created.

Hash: A digital fingerprint (unique alphanumeric sequence) representing transactions on a block. Also, changes made to a block change the hash as well.

Let’s assume we create a record and add it to a blockchain. When we add a new record, it is chained to a previous record, as we add more records, they become linked hence the name “blockchain”.

When a new block is created, it’ll have its set of transactions, the hash of the previous block including its hash, and every block added to the chain adheres to the same pattern.

If a change were to be made to one of the records or blocks in a chain it means that the hash would change- therefore, the block that has its hash recorded would become incorrect meaning that you’ll have to tamper with every block on the chain to make changes which would be reflected, making it hard to modify.

There are different types of blockchain technology e.g. public, private, hybrid, permissioned, and permissionless, and each has its benefits and limitations, which we’ll cover in another article.

Why Blockchain?

In business, trust is a must-have value, if there’s no trust it would be unlikely or difficult to build a relationship with clients, employees, or stakeholders.

One of the aims of blockchain is to ensure transparency during transactions. It is said that blockchain changes how we trust in business. Imagine having a Business with a record-keeping system- this record can be edited, deleted, or backdated for malicious reasons.

When a record is stored in the blockchain it becomes hard to manipulate by anyone to either cover a track or change things at will. Blockchain ensures the following during transactions, as they include;

Transparency: Blockchain is built with digital blocks, It is a distributed ledger wherein all network participants share certain credentials. This transparent nature makes it difficult to edit or make changes to the blocks, this makes data on blockchain accurate, transparent, and consistent.

Security: Data security is one of the cores of blockchain technology, every transaction on the blockchain is secured ensuring data integrity. The structure is such that transactions have a cryptographic process, which ensures that data is immutable.

Decentralization: In a blockchain, data is shared across nodes in a network, or devices running on the blockchain this helps to keep data intact.

What is Digital Marketing?

Digital marketing is traditional marketing with digital tools. It follows the same marketing methods but is upgraded using digital devices which include; mobile devices, social media, apps, search engines, and various digital tools to promote products and services.

Blockchain Marketing

Blockchain marketing is the ability to use blockchain technology to enhance security and transparency in digital advertising e.g. social media marketing, affiliate marketing, email marketing, content marketing, etc.

Blockchain in Digital Marketing

When we visit websites and click on or grant certain permissions, we allow access to our data which can be sold for advertisement and marketing. For instance, internet companies provide a platform for digital marketers to advertise goods and services and charge them based on ad views.

The ad views can be inflated by these companies who may use automated traffic to generate large volumes of non-human traffic, and, because digital advertisers have no form of transparency these companies make a lot of money by inflating ad views.

Blockchain can transform marketing concerning trust and transparency, possibly removing the middleman in digital marketing. It would allow digital marketers and publishers to buy space from a decentralized exchange independent of the control of a big organization or entity.

This way, advertisers can reach the right people, publishers get paid the right amount, and users see ads they’re interested in. Examples of blockchain platforms that aim to bring transparency in the digital media industry include BAT (Basic Attention Token), and AdEx.

Use cases of Blockchain in Digital Marketing

Here are different use cases where blockchain can be implemented in digital marketing, and they include;

Social Content Creation: Steem is a social blockchain that grows communities and makes immediate revenue streams possible for users by rewarding them for sharing content. It’s currently the only blockchain that can power real applications via social apps like Steemit.

Steemit is a social media platform built on Steem blockchain where authors get paid when readers up vote their content. This allows content creators to get paid instead of their content being monetized by third-party companies like Facebook,Instagram, etc. Also, marketers have access to creators without concerns regarding copyright rules

Profitable Loyalty Programs: Customers can sign up for loyalty programs and earn loyalty points which is a win-win for brands and customers interested in the brand. For instance, Brave rewards allow users to earn tokens called BAT (Basic Attention Tokens) for ads you see in the Brave browser. You can also see and earn from Brave Ads that appeal to you.

Smart Contracts for Advertising: A smart contract is a self-executing program with actions required on a blockchain transaction. Smart contracts execute marketing deals automatically which may include getting paid directly based on ad clicks. This enables transparency amongst all parties involved, as well as making sure people are compensated accordingly.

Benefits of Blockchain in Digital Marketing

Here are a few benefits of blockchain in digital marketing including;

• Data Management and Security: Blockchain prevents data breaches because of its decentralized nature, which distributes data across computer networks, making it hard for bad actors to gain control over the dataset. In other words, it helps secure data and regulate access to sensitive information.

• Ease of Buying and Selling: Buyers and sellers can transact without intermediaries, reducing costs and increasing efficiency.

• Transparency In ad supply chain: Businesses will get more accurate leads because they'll get data directly from customers. The immutability of blockchain would ensure transparency in transaction records.

This can help to build trust between customers and brands as blockchain can verify the authenticity of ad impressions ensuring that digital marketers aren't spending marketing budget on fake views.

• Prevention of AD Fraud: There's no accountability or transparency on how ad dollars are spent. Brands that invest a lot of money in ads do not receive the transparency and reporting required.

This is an issue for brands and publishers in the space. Ad fraud is widespread, and marketers spend millions/billions yearly, to ensure their ads reach the right audience.

There have been cases where money spent on ads was lost to fraudulent inventory. Blockchain would be able to validate and analyze customers' journeys through verified ad delivery confirming a person and not a bot viewed the ad.

Marketers would control how their assets are delivered and monitor how their ads are placed. Ensuring proper ad engagement tracking leads to better ad spending.

• Ad Verification: Using blockchain for marketing ensures that ads are delivered and ad performance is recorded accurately. Because of blockchain's immutability, it becomes hard to manipulate the record of ad impressions and clicks. This ensures trust and transparency in marketing.

Summary

Blockchain technology in digital marketing would change the way marketing is carried out. There would be more transparency in digital marketing campaigns.

Also, customers also have the opportunity to view ads they are interested in and also get paid by signing up for loyalty programs.

In a nutshell, Blockchain in digital marketing would increase trust, security, efficiency, and transparency in marketing.

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