The blockchain opporunity in (m)adtech

A BLOG PIECE BY ALEX JACOBSON

SBDS - Blockchain

What is wrong with (m)adtech?


ATS London 2018, was what you’d expect from a “madtech” event (or at least that’s what the cool kids have aptly named it this year): we had a few charismatic talkers - some spouting pure BS, and plenty that had little new to say. It all boiled down to the fact that AdTech, MarTech, DataTech – it’s the opportunity for advertisers and marketers in today's climate.


If, and only if, we can overcome certain familiar hurdles.


The event was an insular affair - unless your job is to drive revenue from tech providers - it was more informative than it was “opportunity” based. But that’s not such a bad thing. When your role tends to be delivery based, as with many of us at SBDS, its a welcome change from a multitude of PowerPoints  and “White Papers” that serve little more purpose than to act as a logo placeholder for the latest tech “roadmap”.


Discussions, as always, turned to the issues that increasingly submerge our ecosystems.

To note a few, I jotted down what I perceived to be the core topics that were mentioned on numerous occasions:


Transparency of billing and margins

Privacy of users

Accurate attribution that goes beyond the last-click

Unstandardised acquisition practices

Fraudulent acquisition practices

The monopoly/duopoly/triopoly/or, what at SBDS we simply call the centralisation of media

Agencies running riot with client media budgets

Poor outcomes from publisher facing tech

TV still rules


Overarching all of the above, is arguably the most 'trendy' word (within the walls of our industry, of course) of the past 10 years: programmatic.


SBDS - Programmatic

The story is well-known and evidentially clear: businesses had once seen tremendous incremental revenue from programmatic advertising – on both sides of the marketer-publisher dichotomy. Results had led to nearly all display inventory being traded programmatically, and many other channels in hot pursuit. Yet, rather than provide businesses with sustained ROI and growth, the gains have stagnated somewhat. Margins have diminished, ROI has lessened, the big players have taken control and the remaining publishers are feeling the pain.


Apparently, no one is happy. Agencies have been called out by their clients for making disproportionate  profits on media margins whilst clients’ ROI has been diminished at the same time. Tech providers are offering products that are now often impossible to differentiate from one another, and the relationship with sales teams are probably more important than actual demonstrable performance gains. As a result, a merry-go-round has ensued where agencies and technologies are swapped out every few years, whilst brands seek to find ever finite rewards from their programmatic outlay. All the while, inventory is getting ever cheaper, and publishers are getting weaker by the day.


The result has seen a number of bad practices evolve. On the one hand agencies, whose profits are (rightly) being eroded, are increasingly being tempted by shady deals with kickbacks. In some businesses and market regions it has become a vital source of revenue. On the other hand, more and more programmatic is being driven in-house, but many businesses are more than ill equipped to take on the transition. This leads to poor media execution and unhappy clients for the tech companies.

All the while, click bait rules the day and ad blocker usage is constantly rising. The only thing rising quicker than user dissatisfaction, is the power of the likes of Google, Facebook, Apple and Amazon - and the walled gardens they are perpetuating.


You’d be forgiven if you felt the internet was broken.


Is there a silver bullet for fixing (m)adtech?


If only there was some technology, or sector, that could help mitigate these issues.

A service that instilled confidence across the board.


Confidence for marketers that the inventory they are buying is real, and that the data they are using is accurate. Confidence that good quality content will be rewarded. Confidence that the technology being used will provide results. Confidence that all players are playing by the rules of the game. And on the other side of the coin; confidence that, as a user, you could do as you please and have the power to choose which businesses had access to your data.


As these themes began to play out at ATS London 2018, a few tweets began to appear on the live feed behind the stage sporadically. Maybe there is actually a technology that could help resolve these problems?


However, when the topic finally arrived on the agenda, around half the attendees had either left the building, or had gone to the bar. For those that stuck around, the session was light hearted – the whole thing is a scam, right? And a pretty dull one at that.


Introducing blockchain.

Welcome, blockchain, to the world where your wild ideals of decentralisation, peer-to-peer transactions and immutable truth are, so far, met with groans, blank stares and casual guffaws (I’ve literally never typed that word, but research tells me that is the best word the English dictionary has to offer for describing a condescending middle-class chuckle).


Blockchain: welcome to your likely home of genuine revenue and real-world use cases (outside of global banking domination).


Here comes the elephant in the (m)adtech house of fun.


Do I actually believe that this technology can give businesses more transparency, a more accurate view of their media spend, and a more standardised playing field for the industry? Do I really think that blockchain can reduce fraudulent impression counting whilst boosting publisher power and enhancing the user experience?


Yes. Absolutely.


Why?


Because smart contracts mean that a transaction literally cannot occur unless pre-established criteria are met. Imagine a world where a business gets paid instantly for their work, but only once they have performed their actual duties.


Specifically, in (m)adtech, this means CPMs could only be paid in the event that a campaign delivers a pre-agreed number of actual viewable impressions and addressable audiences or users. What’s more, once the above criteria are met, money flows instantaneously without the need of a bank to intermediate, and where the government, brand, technology provider or publisher can instantly audit outcomes at their will.


Don’t get me wrong, nothing will ever completely stop the ailments of our industry – after all, we are only humans (or human built algorithms) (or maybe even algorithm built algorithms, built originally by humans).


But, the prospect of a software program built on the principles of a decentralised distributed ledger can actually tackle many of the problems listed out at the beginning of this article.

Do you agree? Or, do you think I'm caught up in blockchain whirlwind? 

I'd love to hear from you. Send me your thought's here.

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