Blockchain is fast, secure, and easy to verify, allowing parties to make transactions without a third party’s involvement. For this reason, it can be used in several industries. The health industry can use blockchain to get a patient’s complete medical history without contacting a former provider. Automobile manufacturers can use blockchain to determine at which stage of manufacturing a defect occurred.
Marketing is another example of a field poised for blockchain disruption, with a striking array of uses already influencing this massive industry. This article will discuss how blockchain technology is affecting marketing currently and delve into the impact it might have on the industry down the line.
Blockchain basics and what it means for marketing
You may be familiar with blockchain as it relates to exchanging cryptocurrency. Each file or block contains a message that says, “subtract this many Bitcoins (or any cryptocurrency) from one account and add the same number to another account.” These blocks are stored on a ledger or chain.
These ledgers are decentralized, which means a copy is stored in every mobile device or computer involved in a transaction. For this reason, no central entity, like a bank, is needed to process transactions.
How does this process relate to marketing? Blockchain can allow marketers to gather and protect the information that users choose to share with them, add a layer of security to transactions, and reduce ad costs while improving ad efficiency.
The section below will go into more detail about how blockchain can break down marketing barriers.
How blockchain is changing marketing and tips to adapt accordingly
While you can advertise your products on platforms like Facebook and Google, it can be difficult to tell if you’re getting the right eyes on them. You have to do testing and analytics to see how much your marketing is converting.
When you market online, you can spend a lot of money on ads, networks, and experts to perform search engine optimization (SEO). Up to 80% of consumers don’t engage with online paid ads, so they can be ineffective and financially draining.
With blockchain, you can focus your marketing, with previous transactions letting you know if a customer is interested in your service. Then, you can target them directly.
As a bonus, when you make a sale, blockchain uses collections of codes called “smart contracts,” ensuring compensation is provided immediately when a service is performed. And because there’s a ledger shared by everyone, there’s no need for paperwork like invoices or purchase orders.
Optimizing ad spend efficiency
By using blockchain, advertisers can buy ads more efficiently. Online advertising is susceptible to many different types of scams. One way a scammer might commit ad fraud is to create a fake website that displays an advertiser’s pay-per-click (PPC) ad.
The scammer will then create bots to continually click on the ad. Each time the ad is clicked, the advertiser has to pay more money to the website owner. Of course, because these clicks come from automated bots and not actual consumers, there’s no chance of making a sale.
Blockchain allows the advertiser and publisher to have a ledger of the impressions on a site. Advertisers can easily see a consumer’s journey to the site and evaluate whether the traffic is real or a bot.
Also, the advertiser can see how well a publisher’s site is performing. With this information, they can measure their return on investment (ROI) when advertising with a particular publisher and focus their funds on only the highest-performing ones.
Using smart contracts
Smart contracts are lines of code that allow a transaction to occur immediately when the desired action is completed. For example, you might use a smart contract with a publisher. The contract would be set up to pay the publisher when your digital ad is featured on their website.
Because smart contracts work automatically, using them is much faster than using a third party for transactions. Let’s revisit our example: Without using a smart contract, the publisher would have to wait for a bank to confirm and release their payment.
Smart contracts within a blockchain system can also be more secure than using third parties because everyone involved in the transaction has a history of the transaction. When a single entity manages your transactions, there are several things that can go wrong. They can make mistakes that cause the wrong amount of money to be released, or worse yet, get hacked, which can put your finances at risk.
Smart contracts in a blockchain have encrypted information shared with all actors. Everything is programmed, so there’s no chance of human error, and all the transaction information is stored on each computing unit involved, so a hacker can’t break into a single source.
Giving customers control of their information
In the digital age, we pay for social media with our personal information. Social sites clamor for access to our demographics, interests, and search history in the hopes of selling it to advertisers and making a profit.
Blockchain gives users the ability to keep their information private or encrypted if they want to or sell it to the companies they choose. One way that consumers can capitalize on their personal information is by filling out paid surveys for different businesses.
Not only is this good for customers hoping to keep their personal information private, but it also makes it easier for marketers to approach them with the knowledge that the potential customer is interested in their services.
Making the marketing process transparent
Blockchain stores every step in a transaction into a decentralized ledger, making it easy for consumers to see the origins of a product. Marketers can use these ledgers to promote and verify traits about products and services that certain customers might find desirable.
If a marketer for a retail company claims that the workers who manufacture their clothing are paid fairly, they can point to the blockchain as proof. This transparency adds a greater level of trust between consumers and businesses.
This allows you to set your business apart from your competitors. There’s a large number of customers that prefer companies that deliver both quality products and services and are socially conscious in their approach to business. If you put in the work and expense to operate with better business practices, it’s only fair that you capitalize on your efforts.
Developing a decentralized customer ecosystem
With blockchain, everyone has access to a record of a transaction. Financial transactions don’t have to be run through the banking system, and advertisers can communicate directly with publishers instead of going through a network.
Consumers are gaining greater levels of technological awareness at a rapid pace. They need to pay for and receive payments for goods and services as fast as possible. Blockchain eliminates the need for middlemen, like banks. Transactions happen faster because they don’t need to be verified by a third party. As a bonus, customers save money on things like processing fees.
Blockchain redistributes control from intermediaries back to businesses and consumers. This allows for a closer relationship between organizations and their customers while allowing both to save the money and hassle that can come from dealing with go-betweens.
Harness blockchain technology with the world’s best
The development of blockchain technology is already having a profound effect on marketing practices.
Blockchain can eliminate the need for mediators and let you advertise directly to the customers most likely to buy your product. It also adds a level of transparency between your business and consumers and lets customers volunteer their personal information or preferences if they choose.
Blockchain can even help you maximize your ad spend and keep money that would typically go toward transaction fees.
To take advantage of these benefits and adapt to a changing marketing landscape, use Upwork. Our work marketplace has a global talent pool of skilled, independent experts who can help your marketing business implement blockchain technology that will revolutionize your approach.
