Exploring the marketing problems blockchain could fix
In her role as Verasity’s chief marketing officer, Maryam Mahjoub is immersed in the cutting edge of digital advertising. The ‘blockchain marketer’ dispels some of the myths and confusion about crypto tech.
Undeniably, the heart of every business, regardless of industry, is data. There’s no escaping it. In the digital age, we need data to understand our customers, deliver better products and deliver more effective marketing – it’s the key to any organizations' success. But as marketers, as much as we need and use data, I’m sure you all can agree with me when I say that it’s the bane of our existence.
I love data, I really do. I also hate data, and figuring out what needs to be captured, how to capture it, what needs to be shared, how to share it, how to consolidate data and how to effectively analyze it. There are tons of systems and tools to help manage it - and blockchain is one of them.
Does blockchain solve for every challenge I listed? No. But, it does solve a lot of issues centralized data systems can’t easily manage. Is blockchain technology effective in every use case? Definitely not. Blockchain can’t solve everything – but when it is a good fit, it’s pretty amazing. I’ll look at some of the inherent benefits of blockchain technology and when they make the most sense for everyday business requirements.
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Transparency and trust
The very best part about a decentralized ledger is that it’s fully transparent. No single actor “owns” the data – and any change or manipulation of data is also captured on the blockchain. This level of transparency is absolutely ideal when there is a lack of inherent trust amongst parties.
Let’s take the example of online advertising – advertisers, publishers and any intermediaries all have their own sets of data on performance metrics. How often are they fully aligned? Who is the most trusted party when they aren’t aligned? How much time and money is spent trying to reconcile the disparate sets of data?
New projects are building out solutions so that critical information is stored on the blockchain, where all parties can see the same relevant data in real-time. Another simple example: the basic costs of audits for public companies, banks and government agencies. Imagine having real-time data that is shared across all relevant parties. Auditors would eventually become obsolete.
One of the biggest concerns in a world of big data is security. So many organizations have had to deal with the costs and reputational damage of data breaches. Over 52% of all data breaches are due to malicious attacks, according to IBM’s Cost of a Data Breach Report 2020, with an average cost per customer record of $150.
Centralized data centers are a dream for hackers, offering them easy and efficient access to your data. But with a decentralized ledger, data is stored across a network of computers, making it nearly impossible to hack. Blockchain can also further increase security by anonymizing data and setting permissions for data access.
One of the more innovative and interesting applications of blockchain technology is the ability to tokenize assets. By now, you may have come across the term ’NFT’ or ’non-fungible token’ – they’ve been the latest craze in blockchain technology.
Tokenization is the process of taking any asset, digital or physical, and creating a digital token for it. That token can be moved, sold and managed on the blockchain. Tokens can be broken down into fungible and non-fungible assets. Fungible assets are those that can be replaced with an identical item – like gold or sugar, for instance. Non-fungible tokens are unique, singular items that cannot be broken down to smaller pieces – like artwork.
NFTs have become very popular in the art space, with digital art, music, and now even movies and gaming leveraging the technology. Why? Aside from the streamlined digital nature of NFTs and the transparency of the sales process, NFTs can have royalty distribution hard-wired into them. That ensures artists, content creators and publishers get their share of secondary sales. This is a game-changer for so many brands dealing with grey markets.
Blockchain offers a host of benefits, from transparency to security to cost management and, of course, tokenization and trust. While it may not be the best technology for every business – it is a captivating technology and applicable to most industries.
Hopefully this article has outlined not what blockchain really is (you can learn about that in my previous article on the advertiser’s guide to Bitcoin and blockchain technology) but what it can do in the real world.