The blockchain opporunity in (m)adtech: part two

A BLOG PIECE BY ALEX JACOBSON

SBDS - Blockchain

Is blockchain a joke?

For those of you who read part one of this blog series, you'll know it focused on how blockchain could one day become a valuable part of the media ecosystem. For those who didn't - give it a read now (here).


With a huge chunk of industry headlines latching onto the tech last year - debating what it can and cannot offer - it begs the question: if all these opportunities are true, if the future of blockchain is possible, then why is it such a joke?


There are talks of blockchain 'bubbles', 'smoke screens and mirrors', amongst scammers, poor tech and paint drying. I think it's time to explore further, to truly identify the opporunity behind the hype.


Question: Is there a blockchain 'bubble'?

Answer: Kind of (ish), but not really.


The reason that blockchain gets such a hard rep, is because of the Cryptocurrency opportunity. To date, the main real-life functioning use case of blockchain technology has been a case of catastrophic, underwhelming performance and has subsequently led to what the Cryptokids and trading community call a “pump and dump”.


Many others have explained this better, and in more detail. However, to try and put this succinctly, Bitcoin is a revolutionary concept of a new decentralised currency, maintained and governed by the community itself using blockchain. As the Bitcoin ecosystem grew organically, its value amongst the community skyrocketed. Bitcoin became so successful, that countless other projects have opted to try the same decentralised community driven formula.

Rather than raise funds through venture capitalists, blockchain entrepreneurs approached the public with their business plans, and offered a stake in the project through an Initial Coin Offering. In 2014, the Ethereum ICO began with a starting price of 2000 Ether in exchange for 1 Bitcoin ($623 at the time). The more these projects grew, so too did the demand for Bitcoin, and later Ethereum (as start-ups raising funds for their decentralised dreams required public investment through Cryptocurrencies - and not fiat money). As demand grew, the price of these tokens rose quickly attracting a multitude of speculators and fraudsters driving the price up even further.


The issue, though, is that to actually be a currency - or store of value - you need only one vital thing; widespread belief in that value. Bitcoin itself (or similar) is, in my opinion, quite likely to succeed one day as a commodity of some kind, but almost all other recent currency projects are not even going to get close. Therefore the “value” these projects and their tokens actually hold, is in fact very close to zero.

And I’m not the only one who holds this view. Most people thought that these tokens were worth little. And so when the market’s biggest players started dumping their Crypto assets, so too did everyone else. The gold rush of Cryptocurrency in 2017 and early 2018, ended as abruptly as it started. Forget the blockchain 'bubble' - it has barely been born.


Question: So, does that mean blockchain is all 'smoke and mirrors'?

Answer: Kind of (ish), but not really.


The “market” is unregulated, and there are most definitely scammers. But there are also a lot of fantastic coders, entrepreneurs and businessmen who will go on to create exceptional organisations.

However, just like any other industry - and (m)adtech is included here - there are going to be so many failures and so many fraudsters along the way. Unlike (m)adtech though, the crypto element has grabbed the public’s attention and this is a recipe for disaster. Imagine the financial fallout if the public were inspired to invest in a 3rd rate cowboy DMP - or by a shitty pixel retargeting business?

The main difference between blockchain and (m)adtech, is simply marketing. In corporate language, the former has a B2C go to market strategy whilst the latter a B2B - the conversation may have similarities, but in reality will be very different.

Question: And so finally, is blockchain like watching paint dry?

Answer: Kind of (ish), but not really.


Whilst in-depth blockchain descriptions admittedly put people to sleep, many have said (such as Kochava’s CEO Charles Manning on stage at ATS) blockchain in 2019 is currently where the internet was in its own infancy in 1998.


How many of you (m)adtech veterans actually understand how the internet is constructed? And I’m not talking about simple JavaScript or SaaS platform functionality - I mean the ins and outs of how different protocol layers, applications, transmission controls and hardware combine to direct packets between different stacks?


And do you actually want to know? Probably not.

Do you really need to know? Kind of (ish), but not really.


Unless you work in those few specific roles, marketers simply don’t need to know these things in any great detail. They just need their 'data nerds' to work out the inner workings first. Right?


Lets conclude


It’s universally accepted that programmatic’s beginnings can be traced back to the late 2000s - if that’s the case, for blockchain, we have almost a decade to get it “right”. I’m not saying blockchain will completely solve the issues discussed at ATS and other thought-lead events, but we do know what the technology is capable of – and it really is promising. 


SBDS are about to roll out an actual live use case, where one of the world’s largest broadcasters are going to use distributed systems in order to share data with a brand over connected TV.

Whilst the first phase is going to be basic, it shows how blockchain has provided the means to enable the use of distributed databases in a more expansive manner than just the use of cryptocurrency. Marketers, publishers, and distributers within TV now have the ability to utilise distributed systems to share insights and show how blockchain can be used as a mechanism for validation and transparency of that information.  Blockchain technology combined with distributed systems provides a new platform for the media ecosystem to activate data for forecasting, advanced targeting, and validating events.


It’s kind of the holy grail for (m)adtech – a forward thinking data rich TV campaign that is GDPR compliant.


But do you think we can actually learn from history for once? Do you think that we will use lessons from programmatic to ensure we won’t fall for the same old traps?


My guess: Kind of (ish), but not really.


If you want to be an early adopter, take risks and enjoy significant gains - then come and speak to the team at SBDS.


We are a team of DataTech (some might say (m)adTech) experts who genuinely do enjoy the ins-and-outs of technology. We thrive off the innovations that sculpts the industry landscape in which we exist. Essentially, we provide that skill to marketers, so that they can concentrate on what they get out of bed for in the morning; driving results.

Want to discuss further? Drop me an email alex@sbdsglobal.com 

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