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Blockchain Advertising – Towards Transparency, Accountability and Privacy


The advertising industry is huge. It is growing rapidly due to the boom in technologies, enabling digital and seamless advertising methods. In 2019, the industry is expected to experience a 5% growth, with the revenue crossing $600 billion.

Out of this, more than half the global revenues, approx. $304 billion will be allocated for digital ads. In the US alone, ad sales might very well reach a staggering all-time-high of $220 billion. However, a report by Juniper Research underlines the risk of marketers losing around $44 billion to ad frauds by 2020.

The ad industry, in its present form, is rife with issues, including expensive intermediaries, lack of transparency & accountability, and inefficiency. Now, with substantial research, Blockchain Advertising & Marketing is emerging as a promising alternative and a plausible remedy for the issues of the ad industry.

In this article, we explore the various aspects of the relationship between Blockchain and Advertisement. In doing so, we’d outline the various benefits of using Blockchain for advertising. Then, we discuss some of the significant Blockchain Advertising use cases, focusing on some of the ongoing innovations.

Issues in the Advertising Industry

  • First, and probably the most essential, there are the notorious ad frauds. Usually, this involves artificial bots clicking on ads to generate false traction data, thereby misleading marketers.
  • Second, owing to the downsides of inadequate programmatic advertising systems, ads end up on undesirable platforms. Such irrelevance, in turn, results in low conversions and the subsequent wastage of resources.Moreover, this often tarnishes the brand’s image when their ads are placed on objectionable platforms with which the brand, or its intended clientele, doesn’t resonate.
  • Third, the industry is highly centralized now, more than ever. This is because of the rise of digital marketing agencies, which control the field by forming a bridge between the advertiser and its target audience (user/potential consumer).Also, there are other centralized forms of ad world giants, such as large publishing houses and, above all, the likes of Google and Facebook.

Why Blockchain?

Most importantly, the distributed blockchain ledger is immutable. That is, data once stored on the Blockchain cannot be edited or altered. The information is stored with a time-stamp. Every transaction is known to the whole network as soon as it gets initiated and needs to get verified before being processed. This leaves very little room to commit any fraud.

Using Blockchain-based smart contracts, it is possible to develop efficient ad funnels with multiple layers of checks, enabling better targeting, and ROI. Also, given that Blockchain networks involve a majority consensus of their members (nodes), it can make the ad industry more secure overall.

The Blockchain Advertising Promise

Having outlined the general benefits of using Blockchain, let us focus upon the specific upsides of using Blockchain in Advertising and Marketing.

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Eliminating Intermediaries

Presently, multiple levels of intermediaries are running the advertising industry. Consider, for instance, Google Ads and Search Engine Marketing (SEM). Leaving aside the technicalities, the top results for any search are those with the Google Ad banner.

Obviously, it is these ‘top’ pages that get the most traffic, while others indulge in a vicious cycle of investments to keep up with the competition.

Such intermediaries not only act as centralized bodies of control and trust, but they also result in significant cost escalations for the industry at large. So, how can Blockchain help?

Every node, on a Blockchain advertising network, can be pre-verified ruling out the need for validation by professional institutions such as Google, among others. Also, given the shared database, both the advertiser and the website owner would have access to data pertaining to the number of clicks, revenue generated, and other details.

Consumer Trust

In the US, as elsewhere, the overall consumer trust in businesses is waning, going down from 58% in 2017 to 48% in 2018. And, one of its major contributing factors is the inherent lack of accountability and transparency in the ad world.

Suppose, a company advertises a product on the grounds that it contains 70% olive oil. Yet, at present, there’s no easy way of determining whether it is true, apart from ‘trying’ the product at least once. At best, one can trust the reputations of either the brand or the advertising agency.

Yet, reputation, as we know, doesn’t ensure accountability. Amidst long texts of ‘Terms & Conditions,’ companies often include clauses that render the user powerless in case of disputes.

Data (product, dealer, or product information) on a blockchain is immutable, time-stamped and transparent (distributed). Walmart, for instance, in collaboration with IBM, is using Blockchain to make its supply chain more transparent by enabling consumers to track the product at every stage along the supply chain.

In turn, this makes their advertisements more credible and converting, as consumers can now verify the ad claims in terms of the actual product specifications.

Moreover, with the advent of tokenization, it is now possible to cryptographically represent assets on Blockchain. Owing to mathematical foundations for its authenticity, this enhances the consumers’ trust in a product and, by extension, the brand.

Consumer Data Privacy

Presently, the advertising industry is intruding. Almost every website these days uses cookies to gather and track user data, in the name of “personalized content.” This data, in turn, is being leveraged by advertisers for better targeting and re-targeting of ads.

From the user’s perspective, this implies a lack of control over their data on the internet. Despite the option to “unsubscribe” or block pop-ups, there’s no way that one can actually evade this. Not as long as one chooses to use the internet.

Using Blockchain in advertising would ensure greater control over consumer’s data. Every transaction on the Blockchain involves the Private Key and Public Key, which ensures only the authorized user, for whom the information is intended for, can access the information.

As a result, marketers in a Blockchain advertising ecosystem would require the consumer’s active consent to be able to use their data. Moreover, storing information on Blockchain also allows the owner of the content to monetize the same by voluntarily making it public or giving access to the specific organization to access it.

Blockchain Innovations in Advertising

  • Rebel AI
    Rebel AI uses blockchain to develop cryptographically encrypted verification systems. These can be used to tackle ad fraud. Domain Spoofing, by which scammy ad networks misuse and obscure marketing data, is a major challenge within the industry, both for brand owners and their audience.Using pre-verified and publicly documented identification of marketers, Rebel’s is a way to mitigate such issues. Also, the blockchain-based, immutable digital IDs enhance the overall transparency and empower ad owners with accurate runtime data, among others.

    It also generates actual data for the number of humans that have interacted with the ad, while distinguishing them from bots. NYIAX, an advertising contract marketplace, is using Rebel’s platform to leverage legitimate contracts and a detailed supply chain registry.

  • IBM
    With their typical blockchain enthusiasm, a part of the ongoing IBM endeavors focuses on using blockchain to make the advertising supply chain more transparent and fault-proof.Working with Mediaocean, an advertising and analytics platform, the company ensures effective data insights for marketers, using a Blockchain-based distributed ledger. It documents every marketing activity, mitigating resource wastage, ruling out intermediaries, and exposing frauds.

    The Programmatic Ad Industry is opaque, making it difficult for marketers to track expenses and verify revenues. Also, marketers have to pay the so-called “ad-tech tax” or programmatic fee. In the US of 2018, the amount was $9.86 billion and is expected to clock $13.44 billion by 2020.

    Using IBM’s platform, companies such as Unilever, Pfizer, and Kellogg are on track to significantly curtail on such intermediate expenses. This will expectedly result in lower prices for customers.

  • BitClave
    Using blockchain, BitClave enables consumers to monetize their data while sharing the same with marketers. The BitClave Active Search Ecosystem (BASE) is a decentralized, transparent ledger that allows consumers to grant or deny a marketer’s access to their personal data.Moreover, it enables marketers to connect directly with the consumers for efficient targeting, as well as for trust.

The instances of Rebel, IBM, and BitClave, however, represent only three of the major innovations in Blockchain Advertising. Obviously, there are others which apply similar principles and have the same purpose of making the industry more secure, efficient, and cost-effective.

Native Blockchain Advertising Platforms

In this section, we discuss some of the popular Blockchain advertising use cases. Each of the following decentralized ad platforms presents itself as a viable alternative to its traditional, and often-problematic counterpart.

  • AdCoin Click
    Serving both publishers and advertisers, this is one of the most popular Blockchain advertising platforms at present. It provides an ecosystem where marketers and brands can work hand-in-hand, producing unprecedented results.

    The platform also has a native cryptocurrency, namely AdCoin, which is used for all transactions in the network. And, the overall experience is rather seamless as both publishers and advertisers can easily get on board in a matter of a few minutes.

    Through its pin-point targeting protocols, the platform enables advertisers to rake in substantial cryptocurrency advertisements in no time, easily reaching out to the crypto audience. Built on the Scrypt algorithm, the ecosystem uses the PoW consensus mechanism and has a total of 100 million coins.

    Of these, 70% is pre-mined while the rest is available for the mining community. 60% of the pre-mined coins, in turn, are distributed among the advertisers, representing a cost-per-click (CPC) or cost-per-mille (CPM) value. The remaining 10% is reserved for further developments in the AdCoin project.

  • QChain
    As a blockchain-based advertising marketplace, this platform facilitates peer-to-peer transactions of and within native advertisements. Given QChain’s enhanced transparency, this platform proves to be highly profitable and navigable for small brands and advertisers.
  • AdHive
    Coupling the principles of Blockchain, AI and Influencer Marketing, this platform automates native-ad placements.Contrary to the traditional case-by-case approach to ad unit placement, AdHive uses a digital ledger matching system to seamlessly and efficiently placing multiple units at once. In turn, this makes the process less time-consuming, and fault-proof.

    Using AI to verify the completion of ad tasks, the platform offers Blockchain-enabled rewards with the help of smart contracts.

  • AdEx
    Built on top of the Ethereum blockchain, this platform is fully transparent and charges publishers only for valid click-throughs. The most notable feature of this decentralized advertising exchange is the ‘User Profile’ section, which enables users to control which ads they see and which they don’t.Among other things, this makes advertising on AdEx significantly more relevant while enhancing returns on investments and conversion rates.

The Future of Blockchain Advertising

Presently, developments in Blockchain advertising are still in the very nascent stages. Yet, both the blockchain community and the advertising industry is rigorously innovating to actualize the benefits of effectively using Blockchain in Advertising & Marketing.

Some of these, we have already discussed. Yet, there are others that have the potential to completely transform the industry.

In all, Blockchain does offer a range of pragmatic benefits for the advertising industry, which may very well be actualized fully in the near future. And, when that happens, users would experience an altogether different way of placing, viewing, and interacting with advertisements.

That said, we look forward to a world where we don’t need ad blockers, and where we liberate ourselves from the ever-spying cookies.

If you are looking to build a similar advertising platform on the blockchain, our team of developers can identify the feasibility of your idea and come up with an ideal solution.

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Author’s Bio

Akash Takyar
Akash Takyar
CEO LeewayHertz
Akash Takyar is the founder and CEO at LeewayHertz. The experience of building over 100+ platforms for startups and enterprises allows Akash to rapidly architect and design solutions that are scalable and beautiful.
Akash's ability to build enterprise-grade technology solutions has attracted over 30 Fortune 500 companies, including Siemens, 3M, P&G and Hershey’s. Akash is an early adopter of new technology, a passionate technology enthusiast, and an investor in AI and IoT startups.

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