Between Facebook’s never-ending data targeting scandals and the drumbeat rise of ad blockers, some entrepreneurs think it’s time to renegotiate the relationship between the digital advertising industry and the consumers it serves. And they say the buzzy technology behind cryptocurrency provides a promising means to do so.
A growing number of companies are exploring how blockchain—the encrypted transaction ledger that powers virtual currencies like bitcoin and ethereum—can be used to reward brand interactions, let web surfers sell their data to advertisers or otherwise empower consumers to play a more active role in the digital ads ecosystem.
While it’s still early days, proponents say the transparent and relatively egalitarian nature of the technology has the potential to transform how attention is valued online.
“You’re bringing disparate voices into one place to make one decision, and that’s huge,” said Alanna Gombert, CRO at blockchain-based ad firm MetaX. “You can bring in companies and put them at the same level as consumers, using a token as a utility to communicate.”
Eich claims that the current digital advertising model lacks an efficient market means of valuing consumer attention, thanks to an array of ad-tech middlemen and a system that puts clicks before quality. The BAT is designed to take into account more precise browsing metrics and the ratio of ads to content on a given page in order to more fairly price eyeballs. He sees the BAT’s relative price stability as compared to bigger coins like bitcoin as a sign of it fulfilling this role.
Despite his work building ad-blocking software, Eich said he thinks advertising will always have a place in the online media business. “To me, the problem is surveillance capitalism,” Eich told Adweek. “Advertising is still attractive if it doesn’t involve treating the user as a farm animal to be sheared.”
Eich isn’t alone. It’s no secret that the online ad industry has long faced a crisis in consumer trust. Intrusive and slow-loading ads and alarming stories about the extent of the industry’s data-collecting practices have driven more people than ever to ad-blocking software in the past few years.
At the same time, however, nearly 80 percent of American ad-block users surveyed in the most recent report from Adobe and Pagefair said they would be willing to view at least some ad formats, suggesting that a more amenable compromise could pay big dividends. A similar proportion said in a previous year’s report that they would actually like to see more personalized ads.
To that end, other companies aim to make it easier for people to earn money by telling advertisers what they want to know about them.
Blockchain firm Wibson announced earlier this year that it will build a consumer data marketplace with backing from Spanish telecom giant Telefonica. Wibson founder and CEO Mat Travizano said the company is currently working with advertisers to decide how to best structure and package browser data for sale. The company has also discussed an eventual integration into Telefonica’s AI-powered digital assistant and data management platform, Aura.
“As the internet is the protocol to move data, we see Wibson as the protocol to monetize data,” Tavizano said.
The digital ad industry’s interest in blockchain extends well beyond consumer-focused efforts like these. Elsewhere, trade groups like the Interactive Advertising Bureau and the Data & Marketing Association have convened teams to research how blockchain ledgers might be used to streamline and cut fraud out of buying and selling processes.
But as with any shiny new buzzword to captivate the trade media, uncertainty abounds over the true staying power of the fledgling technology.
“My big concern is always when you have a new technology that the expectation is that it’s instantly going to fix everything,” said Eric John, deputy director of the IAB’s Video Center for Excellence and co-author of the its recent research report on blockchain. “The watchword for buyers and sellers and tech-enablers right now is that blockchain holds a lot of promise and we feel it’s definitely worth paying attention to.”
On the more pie-in-the-sky end of the spectrum is a company called BitClave, which aims to create a blockchain-based decentralized search engine to compete with Google. It recently unveiled a cryptocoin search called Desearch to show off the tech that would ultimately power its flagship product. Like other search engines, Bitclave plans to collect detailed demographic profiles on each of its visitors. But instead of then offering that information to advertisers, it would allow the users to sell it themselves.
BitClave CEO Alex Bessonov has no delusions about the odds involved in challenging the world’s second biggest company. But he says the startup also sees itself as part of a bigger collective effort.
“As we and other startups are looking at this problem, trying out variations of different blockchain approaches—maybe liking one of them and sticking to it and getting away from how things are done today,” Bessonov said. “One by one, it has the potential to change the world.”