Opinions expressed by Entrepreneur the contributors are theirs.
Blockchain and cryptocurrency have become buzzwords far beyond the worlds of digital marketing and technology. experts to predict the blockchain market will reach nearly $40 million by 2025. But as crypto-related buzzwords have become impossible to avoid on a daily basis, not everyone is fully aware of what the passage blockchain technology will mean for brands, consumers and digital marketers.
Related: 4 Ways Your Small Business Can Benefit From Blockchain
What is blockchain and how does it work?
Blockchains are electronic registers or databases. They are shared between different connections in computer networks and store information in a digital format. Blockchains differ from other databases because the technology behind them ensures that records are kept securely.
Another difference between a blockchain and other databases is how data is structured in the ledger. As the name suggests, blockchains group data into blocks. Think of them as the individual rooms or compartments of a storage facility. Once a block reaches its capacity, it is closed and linked to the previous block.
This is how a blockchain is created. Any information added after a block is closed must be stored in a new block. Once this new block is completed, it is added to the existing chain, and so on. In addition to creating a chain, blockchain storage also creates a chronological timeline of when data was added.
A few years ago, blockchains were far from a household name. This changed with the advent of cryptocurrencies. Since bitcoin has grown in popularity, the use of blockchain as a ledger for transactions has also increased. One of the biggest differences from other databases is that blockchain-based data is held by all users collectively rather than in a centralized organization.
What does blockchain mean for marketing?
The financial sector was among the first adopt and invest in blockchain development. As a result, this industry continues to hold most of the market.
Digital marketing as an industry is only beginning to embrace the potential of this technology and create use cases. But while marketers may lag their financial colleagues in adopting blockchain technology, marketing certainly stands to gain from blockchain applications.
The technology continues to develop at this stage and new use cases, including several for digital marketing, are being discovered almost daily. Undoubtedly, blockchain technology and Web 3.0 applications will improve the way digital marketers manage data.
Blockchain will allow digital marketers to:
- Increase transparency for advertisers and marketers
- Quantify the results of marketing campaigns
- Prevent Fraud
Increased transparency for brands and consumers
Consumers have long demanded increased transparency from their favorite brands. At the same time, they protested attempts at greenwashing and other tactics that could curry favor with consumers.
Blockchain technology can put an end to issues like greenwashing because the ledger irrevocably documents the legacy of a particular product. Consumers can view much more detailed information about a given product than they currently can. Brands benefit from the ability to build consumer trust. For example, organic or carbon neutral product claims can be quickly confirmed using this technology.
Marketers looking to place ads also benefit. Increased transparency makes it easier for them to select the right advertiser for a brand, as they can verify audience requests more quickly.
Related: 5 Examples of Businesses That Succeed Through Transparency
Quantify the results of marketing campaigns
For years, marketers have tracked keywords to gauge the success of their campaigns. Despite the monitoring options provided by search engine operators, quantifying campaign results has not always been straightforward.
For example, tracking organic search engine optimization results is tricky for marketers. Separating keyword results on different devices can be as difficult as distinguishing between local or national search engine rankings.
Equipped with the right tracking software, blockchain could provide an answer for some of the marketers who still do. The ledger could give actual numbers on how each keyword performed and track them over time. Data with this degree of precision is valuable for more than reporting. It also forms the foundation for truly data-driven campaigns.
Related: Why Marketing Agencies Should Use Blockchain Technology
Prevent data fraud
Blockchain technology will give consumers greater control over their data. Marketers need to develop more secure ways to store and access consumer data.
But blockchain fraud prevention goes further. Digital marketing is currently suffering from illegitimate vendors committing click fraud in pay-per-click (PPC) advertising campaigns, for example. End-to-end click tracking and transparency can put an end to ad fraud.
Fraud prevention benefits digital marketers and customers. Marketers will have an easier time proving the validity of their results to customers. Customers benefit from being able to track every interaction and get to know their real customers better.
Improved digital marketing
Leading marketers have been emphasizing trackable and measurable results for years. Measuring and tracking campaign performance has been a major reason for the rise in popularity of digital marketing as a field.
Blockchain technology takes these benefits even further. Blockchain technology makes it impossible to alter campaign results by recording clicks and other interactions in a future proof log.
Not only will this development increase trust between marketers and their colleagues, as well as between agencies and brands. The shift to blockchain technology may usher in a new era for marketing. Results can no longer be questioned or attributed to bad activity. Marketers will find it much easier to demonstrate the value of entire campaigns and individual activities within those campaigns.
In short, blockchain technology has the potential to usher in a new era of digital marketing accountability.
Related: How Blockchain Is Creating A New Future For Digital Marketing