Blockchain is synonymous with crypt0-currency, but a swathe of new efforts want to use blockchain to solve many of digital advertising’s problems with fraud and transparency.
Last week, adtech company MetaX launched “adchain,” a use of the blockchain ledger to essentially tag a piece of creative and then follow it on the internet to figure out whether it was seen, who saw it, where it actually ran, conversion rates and how budget was spent along the chain.
Ken Brook, the CEO of MetaX, said the company began experimenting with blockchain tech two years ago. But it was the emergence of ethereum, an open software program based on blockchain that lets you use the technology for things beyond bitcoin that made this particular use case possible.
Blockchain, best known so far in the financial space as the technology underpinning bitcoin, is essentially a massive, shared Excel sheet that can have many uses. These range from figuring out whether tuna is sustainably fished to whether the handbag you bought is counterfeit. But in advertising, the theory is turning into practice thanks to a host of different companies all using it to track ad impressions in digital media.
The key is that blockchain, and adchain, theoretically lets multiple parts of the industry work together with no dependency on one party’s data. “If it’s immutable and decentralized, then you can align incentives,” said Brook. Right now, adchain will embed a tracker in the xml of a creative asset — and in real time, show you who is watching it or if viewability standards aren’t being met.
Here’s what that theoretically looks like in the adchain if it’s about figuring out if an impression was real: A buyer buys an impression, which is encrypted in a block, and then broadcasted to every single participant on the chain. The impression is verified by the publisher, then added to the ledger. Everyone in the blockchain gets to see the impression event and approve it.
Fred Askham, associate director of analytics at media agency IMM, which is currently looking into using the adchain technology, said that what is most interesting for the media buying shop is scaling to prevent fraud. “When a piece of inventory is sold between providers and there is a large amount of resale, it inevitably has problems,” he said. “What I would be able to see coming into our databases would be: here are all the servers this impression would hit. Here is the code for the creative. Here is what was displayed. It would give us a large amount of insights at a transaction level.”
There are other moves in the ad world. Two weeks ago, Nasdaq announced that it was going to launch later this year the New York Interactive Advertising Exchange, which will let inventory be sold using blockchain technology. It uses blockchain in a different way: Smart contracts, which let you facilitate exchanges and when used on the blockchain, will let certain contracts execute automatically, as long as conditions are met. “Once the exchange achieves critical mass within digital, we will begin supporting TV, print, radio and out-of-home markets,” Lou Severine, NYIAX’s CEO, told Reuters.
This research report is available exclusively to Digiday+ members. Join now for access.
Dave Morgan, the CEO of Simulmedia, said that the most interesting potential use of blockchain is on ad-delivery verification. While it’s certainly the zeitgeist considering the issues in digital advertising, it also helps in efficiency, since centralizing auditing through companies like Accenture or Deloitte becomes too involved and is too expensive.
There are also more conversations happening. MadHive, an ad-tech company, is now developing blockchain technology for OTT television in an effort to stay ahead of Google and Facebook. For MadHive, the idea is similar to adchain — brands would track an ad impression in real time through TV Everywhere or other OTT apps.
The problem is the need for adoption — multiple providers at different levels need to sign on the blockchain to make this work: The brand, the agency, the DSP, exchange and the publisher. Right now, most products are in beta. “In the advertising industry we’ve seen this happen a few times where the tech to measure something comes out and then there is some lag time,” said Askham of IMM, which works for clients including Roku and Ameriprise Financial. “While this is a next step toward a degree of transparency, it does require a good level of adoption.”