Blockchain, after the global hype around it in 2017, went quiet but is now coming of age and is "getting ready to usher in a new era of digital marketing", says Lachlan Feeney, CEO and founder of Australia-based blockchain consultancy Labrys. He makes a case on why blockchain could help in the future of marketing backed by some of its USPs: incorruptible customer data, real traffic and transparency.
Australia's pandemic-induced digital transformation boom hasn't escaped the marketing industry, even though digital marketing had a significant lead compared to most other industries. Not only have digital strategies revolutionised the marketing sector in recent decades, but every industry that relies on it, allowing brands to be more targeted and strategic than ever. However, accelerated tech innovation over the last 18 months and a new era of savvy, digital-first consumers present immense opportunities for the marketing industry to push the boundaries of innovation even further still.
This year blockchain has stepped out from behind the shadow of cryptocurrencies, delivering on the hype that peaked in 2017. Blockchain is far more pragmatic and innovative than a cryptocurrency - its most famous use case - and is already creating countless innovations that are improving the way industries operate and businesses connect with their customers. Its potential to usher in a new era of digital marketing 2.0 is incredibly exciting.
Blockchain has come a long way
Blockchain is an incorruptible digital ledger used to record transactions. Traditionally financial transactions - which is how it rose to prominence powering cryptocurrencies - but today almost anything digitally. It reached peak hype in 2017, but while the noise subsided publicly, behind the scenes the innovations blossomed, and the industry started evolving beyond its traditional association with Bitcoin.
In its simplest form, a blockchain is a form of peer-to-peer exchange which removes the need for a third party, like a bank for financial transactions. While we’ve still only seen the tip of the iceberg in terms of its immense potential, the technology already has numerous benefits, including security, transparency, and traceability. For marketers seeking to target the right audiences, reduce click bots and ad fraud, and provide more experiential experiences, blockchain provides many competitive advantages.
How does blockchain fit well in the marketing industry?
While still a comparatively fledgling technology, blockchain has the potential to change the way businesses and consumers interact. By removing the intermediary between two parties - like, for example, Google between marketers and their customers - blockchain allows brands to go straight to source.
Blockchain also enables the gathering of incorruptible customer data, creating and storing individual consumer profiles that allow for significantly more targeted campaigns. Marketers can encode NFTs (non-fungible tokens) - one of 2021’s defining social and technological innovations - with customer insights from CRM, such as age, demographic and spending habits and personalise each one with relevant information, content or promotions.
For example, The National Retail Federation ran Project NGAGE, showing how gamified digital objects on the blockchain can ‘usher in a new era in retail marketing’. The project released hundreds of virtual butterflies and branded digital objects, bringing a virtual treasure hunt to life. Using mobiles, attendees could catch butterflies on a map or in augmented reality, which were redeemable for real gifts at a blockchain booth.
Future of marketing
It has the potential to provide the ‘wow’ campaigns that marketers strive for and enhance the brand-customer relationship and experience; allowing both consumers and brands to maximise the value of their relationship. What’s more, the traffic secured can be verified as real people, not fake accounts or click farms, which keeps marketing costs low and engagement high.
Therein lies another significant benefit: transparency. There are long-term battles against fraudulent clicks, fake accounts and click farms in the advertising and marketing industries. So much so, that one in every five clicks is estimated to be fake. However, because a blockchain is an immutable distributed ledger that cannot be altered or hacked, it makes it far easier for marketers to discern real engagement from fake engagement. What’s more, blockchain can alleviate issues related to Intellectual Property by providing proof of ownership of an idea, campaign or piece of content.
For marketers - and, increasingly, consumers - few issues are of greater importance than data security - especially as our exposure to, and reliance on, the internet grows. Breaches are frequent and damaging, but the blockchain is far more secure than other record-keeping systems because each new transaction is encrypted making it safe from hacks.
Through targeting and transparency, security and cost-efficiency, blockchain has the potential to usher in a new era of digital marketing innovation. While it may sound like a technology of the future, it’s already being leveraged by businesses in every industry, including marketing - where early adopters are getting a headstart on their competitors. So for marketers seeking to stand out from their competition and lead by example in digital marketing 2.0, thinking outside the box might mean working inside the blocks.
Lachlan Feeney is the CEO and founder of Australia-based blockchain consultancy Labrys.