Advertisers are introducing blockchain technologies to ad tech platforms and private marketplaces in hopes of straightening out some of the complicated mess that now defines digital advertising.
A handful of companies have announced they’ve used blockchain in a number of ways to combat ad fraud and improve efficiencies in the digital advertising sector. Some players are using blockchain to deliver more transparent attribution and verification for digital advertising; others are using blockchain-based currencies to enable global ad purchases without worrying about exchange rates; others say it can be used to share audience data between firms and platforms while protecting privacy.
To date, most of the fuss has been around using blockchain to combat fraudulent behavior in digital advertising by making transactions transparent – not just to the clients, but transparent to everyone participating in the blockchain. Earlier this year, the industry body DMA (Data and Marketing Association) partnered with MetaX to use its “adChain” technology to combat ad fraud.
The idea is to provide a “shared ledger” of ad buys to bring more transparency to ad marketplaces and track how ad dollars are spent; the shared ledger, which is really just a big database, can also help marketers verify the ads they purchased were actually delivered. The more companies participate, the better. That means widespread adoption is a crucial component to adChain’s success. It’s so important, in fact, that MetaX is offering adChain as a not-for-profit venture to encourage greater adoption.
DMA sees blockchain as a technology that can benefit the entire digital advertising ecosystem, both on the demand side and the supply side. “We have a responsibility to deliver to our members the tools and knowledge to succeed,” said Tom Benton, CEO of DMA. “This aligns with the utility value that adChain brings, so we can all work together with the adChain solution.”
Marketers have called for more transparency in digital advertising, and ad fraud has become a multiple-billion-dollar headache for digital advertising. But ad sellers, agencies and technology providers aren’t necessarily interested in being 100% transparent about how they conduct their business – especially not among participants who are competitors.
There are technological hurdles, too. Blockchain-based transparency and verification won’t be instantaneous. It can take up to a minute or longer for transactions to be verified by participants using blockchain; in workflows that include, for example, a DSP, an SSP and an exchange, each player adds additional time for each transaction. In other words, the mechanics of blockchain operate far slower than the millisecond decisions made in automated ad buying and selling. And again, each player within a workflow will need to participate in the blockchain for it to deliver the value it promises. That, in itself, is a tall order.
So while industry-wide adoption of blockchain is highly unlikely, firms could easily integrate blockchain-type workflows within smaller, private marketplaces to help build transparency and trust between advertiser and client, by way of an added layer of technology and, by extension, complexity.
A more attractive idea to media sellers will be to create a large, unified audience data set. The idea is to create a massive identity graph of consumers that uses multi-key encryption to protect consumers’ data. This would enable marketers and advertisers alike to share data insights without actually having to share data.
Comcast is the first large media company to try this out using blockchain. Comcast’s advanced advertising group, which includes Strata, FreeWheel, and Visible World, recently announced its “Blockchain Insights Platform,” at Cannes last month. The platform is a tool for TV networks and MVPDs to use to share data insights and help advertisers better match data to audience and to ensure advertisements are reaching core targeted demographics.
“This new technological approach would make data-driven video advertising more efficient and consumer data more secure,” said Marcien Jenckes, president of advertising at Comcast Cable. “We’ll work with the participants in this initiative to improve ad planning, addressable targeting, execution and measurement, to ultimately create even more value for the television advertising industry.”
Comcast is now building up a pool of advertisers, pay TV providers, programmers, and streaming media device makers, to share data using the platform. The bigger the pool, the more effective the blockchain technology. Participating advertisers include Disney, NBCUniversal, Altice USA, UK’s Channel 4, Cox Communications, Mediaset Italia and TF1 Group in France. Comcast is in discussions with other programmers, distributors, device makers and marketers across the US and Europe for the initiative, though Comcast says it will eventually make the tools open source for anyone to use.
Comcast is light on specifics of how this platform will work, which means there’s likely a lot of legwork left to do. Comcast said it won’t make the solution available until 2018. So while the ad tech sector loves to rally around buzzwords, blockchain won’t be shifting paradigms in digital advertising anytime soon.