The digital age blew the opportunities for marketing wide open. There is now a whole other world for marketers to work their magic and generate new leads and sales.
This is massive for companies, as it allows round-the-clock advertising. Along with this, it also means limitless opportunity for sale.
However, as the web has grown, so have concerns over how it operates and how user data is treated.
Blockchain was designed so that the web can run in the way that we know and love, but without all of the concerns surrounding our data.
It is the foundation of cryptocurrencies, but its applications are much more diverse. Digital marketing is one of these, and it is only a matter of time before the marketing industry is affected.
So in this article we will look at how blockchain is changing digital marketing.
What is blockchain
Blockchain’s goal is to store and distribute digital information, but not let anybody edit it. It cannot be altered, deleted, or destroyed.
The name does not give much away about what it actually is. But simply put, it is a database, specifically a distributed database.
A database stores information digitally. And a distributed database stores the information across a network. A network is made up of nodes, and each node is a computer.
Therefore, the information in the database is split up, or distributed, throughout several computers, not stored in a centralized location.
Blockchain became well-known to the public over the last few years with the rise of cryptocurrencies. The most notable of these being Bitcoin.
Blockchain plays a significant role within cryptocurrency systems and is central to how they work. For example, in Bitcoin, blockchain is used to create decentralized and secure records of transactions.
What makes blockchain more advanced than other database systems is that it generates the security of a digital record, and creates a level of trust without the need for third party verification.
The structure of a blockchain database is a key difference, and is also where its name comes from. In a blockchain database, data is gathered in groups. These groups are called blocks, and within a block there are sets of information.
A block can only hold a certain amount of information, and once this is met, the block is ‘sealed’. No more information can be stored in it, and the block is linked to the block before it.
This way a chain of blocks is formed. Once the current block is filled, any new information goes into the next block, which is also added to the chain once full. This system repeats itself every time a block reaches capacity.
A regular database stores data in a different way. Data is organized into tables, and not a chain of blocks linked together as with blockchain. But by using a decentralized blockchain structure, a timeline of data storage is created. This timeline cannot be edited or reversed.
And when a block is filled and added to the chain it becomes the next part of the timeline as it is given an exact timestamp.
How is blockchain changing digital marketing?
The impact of blockchain technology on digital marketing can no longer be ignored. As consumers become increasingly aware of how their data is used by big tech to generate revenue, there is a growing need for alternatives and solutions. This is where blockchain in digital marketing will make a difference.
It is no secret that data security is a bit of a problem in digital marketing. Huge amounts of data are collected, stored and accessed on a regular basis within companies across the entire web.
And this means that there is always the opportunity for hackers to get in and steal it for their own benefit.
But as blockchain ensures that all activity is verifiable, customer data can still be gathered and stored, but without the threat of anyone being able to modify the database to get at the data.
As mentioned in the previous section, all activity is timestamped. And this includes viewing data. Therefore, customer data stored within a company can only be accessed by authorized people.
Social media changes
The very essence of blockchain is to take power away from large corporations or middle men, and restore it to the users of digital services.
But social media flies in the face of all of this. What was once an innocent way of connecting with people, has become the largest marketplace for personal data. At the same time, this is beneficial to digital marketers. Social media is the greatest resource for collecting data, and helps to generate leads and sales.
Although this is beneficial to digital marketing, centralized social media companies such as Meta, Microsoft and Twitter control all the data. The data of every single user goes through these centralized bodies and no one else. This means that marketers have to play by these companies’ rules or not play at all.
Blockchain based social media aims to put an end to this. All blockchain based social media activity will be encrypted in a distributed database. This will be across the entire network, so nobody can grant access to user data. Instead, the user controls her data and what she shares.
Digital marketers may no longer benefit from massive amounts of data. But, they will gain direct contact with users without having to pay the middleman who runs the platform, knowing that the user agreed to share certain information with advertisers.
More reliable leads
Digital marketers use a variety of techniques to collect data. This is then put together, and a plan is formed to implement a campaign.
The problem with this is that a lot of the data collected is unreliable as it is often collected without direct consent of the end user. And if your data is unreliable, your marketing campaign is not going to be as effective.
But as blockchain activity is decentralized, digital marketers have to go directly to the consumer for data. Customers are unlikely to give their data away for free, so marketers may need to spend money doing this.
However, paying for reliable, primary source data could be much more beneficial than advertising based on free, and potentially unreliable data. This is because reliable data means accurate campaigns, giving a higher rate of converting leads into sales. And the return on investment in your data collection is, therefore, a lot higher.
Middlemen free advert purchasing
When placing ads, you want to make sure that they are placed on websites that are reputable and visited by many people, and target the audience that you want to engage.
This usually means that a fee needs to be paid to a company, such as Google, because they have a strong reputation, and this builds trust into the advertiser/consumer relationship.
Blockchain allows you to avoid using ad networks as middlemen all together. As website and platform users will be verified and possibly engage through smart contracts, there is no need to use a third party for increased trust.
Better statistics for business
By using a verifiable blockchain database for all user activity related to ads, digital marketers get accurate feedback of how well their campaigns are running. This is because all transactions that take place will be time stamped and securely added to the block. Advertisers will be able to track first-hand the exact ads, placements and context in which an ad was served to a user, without the data being filtered by an ad processing platform first.
Blockchain in digital marketing
These are just some of the ways in which digital marketing is already starting to feel the effects of blockchain. But as blockchain is still in its infancy, and the web is yet to take it onboard as a whole, it is difficult to know exactly when changes will begin to happen on a large scale.
The ultimate takeaway is that digital marketing as we know it will need to adapt to the changing digital sphere. Techniques that currently generate a lot of money may become redundant, but new opportunities will arise.
And with these new opportunities comes the opportunity for change. The digital marketing industry as a whole will have the chance to remodel itself and work in harmony with consumers.
But once blockchain becomes the standard form of data storage and distribution throughout the entire web, digital marketers will get a better understanding of how it works, and what it allows you to do as an advertiser.