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Blockchain and Advertising Transparency

by Shrey Bhardwaj | Jul 1, 2019

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Blockchain
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3 min read

Blockchain is increasing transparency in digital transactions, removing complexity from the ecosystem by reducing the need for multiple stakeholders in advertising purchases and digital content management. With an immutable, shared ledger that records transactions as they occur, companies in media, advertising, entertainment, and others can have complete visibility as content or data is purchased and used.

Blockchain to Transform Digital Advertising

Blockchain presents an opportunity to increase transparency in the digital advertising ecosystem by introducing smart contracts among advertisers and intermediaries.

How does the system work?

First, the advertiser, intermediaries and publishers form a blockchain consortium network. Thereafter, directly connected consortium members can create smart contracts among each other.

Advantages:

1) Eliminates online ad fraud

Each transaction connected to the advertiser’s digital asset will be verified at each of the nodes through smart contracts. The relevant transaction is stored on the blockchain and replicated on all the nodes – only if members form a consensus on the validity of the transaction across all the nodes.

The validated block of transactions is then added to the blockchain in a linear, chronological order, and in a cryptographically protected block. New blocks of validated transactions are connected to older blocks, making a chain of blocks that show every transaction in that blockchain’s history.

The entire chain is regularly synchronized in order that each ledger in the network is the same, giving each member the ability to prove who owns what type of transaction, at any given time.

Using machine learning algorithms for advanced detection mechanisms such as detection by signature patterns, DNS traffic monitoring, or behavioural analysis, patterns of fraudulent transactions can be detected on a blockchain. Each digital asset is allocated an identification tag and advertisers can audit and proactively search each transaction by intermediaries, to avoid fraud.

2) Establishes a direct link between advertiser and ad publisher

In the current digital advertising setup, intermediaries acquire relevance due to better marketing reach, market intelligence of publishers’ network, and channelizing capabilities. However, the transparency provided by intermediaries is limited to their version of truth.

Blockchain provides unprecedented levels of transparency as well as direct visibility into the marketing reach of ad exchanges and publishers. This presents an opportunity to optimize the number of intermediaries and evaluate ways to establish direct partnerships between advertisers and publishers.

By having the right set of platform capabilities based on blockchain and artificial intelligence, publishers can evaluate the possibility of establishing a direct link with advertisers. This leads to asimplified digital advertising ecosystem, newer revenue and operating models, and cost savings for both the parties, while providing advertisers faster feedback for course corrections.

3) Enhancing Transparency in the Digital Advertising Ecosystem

Ad exchanges that provide a programmatic interface for online bidding of advertising content between demand and supply side platforms can popularize the use of blockchain. Blockchain helpsto act as change agents to create a transparent digital advertising ecosystem.

Image-showing-the-advertising-transaction-model-with-blockchain
(Advertising Transaction with Blockchain)
(Image Source: https://www.businessinsider.com/the-blockchain-in-advertising-report-a-2018-10?IR=T)

Blockchain enabled solution helps advertisers to take benefit from a new way of discovering and purchasing inventory and the ability to secure premium inventory in advance as a result of the higher transparency and forecasting capabilities enabled by blockchain.

Blockchain can transform the digital advertising industry by infusing trust, security, and transparency into the entire value chain, to eliminate the inefficiencies in the current digital advertising model and drive higher value for publishers and advertisers. Even if governments or other global bodies are slow to regulate the digital advertising industry, blockchain can
bring clarity with regard to regulations by enabling smart self regulation in the ecosystem.

Wrapping Up:

In case, you are looking to understand Blockchain’s implications in your advertising business in more detail, drop us an email on [email protected] or schedule a free consultation with our team of blockchain experts who can guide you through the blockchain implementation in a specific use case.

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Shrey Bhardwaj

Shrey is a certified Blockchain Engineer particularly interested in Ethereum and cryptocurrencies. Fueled by passion and talent, Shrey is driven to deliver outstanding Blockchain Solutions. Shrey is a valuable asset to any company wishing to grow and bring their goals to fruition.

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