If you have been monitoring technology news, then you have probably come across the term blockchain technology. This is a term that has dominated many industries in the last quarter of 2017 and continues to do so in 2018. So what is blockchain technology? Many people have come across the term. However, only a few know the meaning. Of those who know the meaning, not all of them understand the scope of its future impact on industries. Before we understand the effect of using blockchain on social media, it’s important that we define what blockchain technology is all about.
Well, blockchain technology refers to decentralized ledgers used in cryptocurrency transactions. By now, you must be familiar with Bitcoin and other cryptocurrencies. Blockchain technology is used to record bitcoin transactions. Basically, the cryptocurrency transactions are recorded in a node or in blocks. Recording these transactions using blockchain technology ensures the security of the transactions.
Blockchain technology continues to impact many industries. Finance and banking are some of the industries. The trend continues to shipping, cybersecurity, real estate, and also social media. Blockchain started as a technology for cryptocurrencies. However, it is positioned to take over in many other industries.
In this article, I focus on highlighting how blockchain can affect social media marketing. So, as blockchain impacts the global economy, what effects does it have on social media advertising? Keep reading to find more.
#1 Blockchain Technology on Social Media Marketing Means More Transparency
Digital marketing has continued to witness more complexity. Social media marketers have been grappling with how best they can validate their data. This has largely been a result of the complexity witnessed in social media marketing. For years now, social media marketers have relied on third-party tools to conduct validation of the data. One of the effects of blockchain on social media is the opportunity to validate own data. Basically, this is what social media marketers call first-party verification.
A recent study revealed that social media marketers could be losing up to $16.4 billion. This is through fraudulent traffic. Blockchain technology will help eliminate fraudulent traffic. Marketers need to ask one question. Of the many clicks received, how many are real? Hiring Bots and people to click on ads inflates the statistics so as to increase the rates. Therefore, this makes it challenging for social media marketers. So, how do we deal with this challenge?
Blockchain for social media marketing allows for an end-to-end procedure when it comes to social media marketing. This will cover the process of booking, buying placing, and ads on social media. Therefore, they can be verified through common consensus. In the end, this eliminates the possibilities of social media marketing fraud. Overall, we will have greater transparency compared to traditional digital marketing and Ad buys. Actually, many key players have been wishing to have a chance to enjoy this privacy.
So what does this mean for the consumers of social media data? Blockchain on social media offers to relieve the consumers of marketing data. This is since they have all the reasons to believe the data they are viewing is factual and accurate. Definitely, this is what the consumers want. Ultimately, marketers will be able to make informed decisions, which lead to higher Return on Investments.
#2 Blockchain For social Media Offers Direct-to-Consumer Digital Marketing
Through blockchain technology, it is not possible to copy or change information. The decentralized system ensures a high level of security on the data. One surprise that it has for digital marketers is that it eliminates the middlemen. By negating the need of middlemen, it is like a complete overhaul of the social media marketing industry. Have you used Google Search or logged on to Facebook recently? Whenever you do either of the two, your data is captured and released to the advertisers. These two platforms make money off the ads that are run on their platforms. However, with blockchain technology, search data privacy takes priority.
Companies like BitClave use blockchain technology, which gives users full control over their data. Here is a screenshot showing what exactly the company offers to Internet users.
The BitClave Search Engine makes use of Ethereum blockchain technology. By using blockchain ad services, the middlemen are eliminated. This creates a direct connection between consumers and businesses. With this technology, users have the ability to select the data that they release to advertisers. What does this mean for the consumers? Basically, we expect there will be more privacy. Consumers have the freedom of choosing what personal data they disclose. There is also the likelihood of commercial benefit since consumers choose which data to share and with whom. Ultimately, these users can now earn some money from the data released to advertisers. Therefore, instead of a middleman selling data to advertisers, the user is selling the data directly.
In fact, through the direct to consumer digital marketing, blockchain for social media will lead to a higher Cost per Impression. This is according to Michael Greene, an analyst at Forrester Research. The marketers and advertisers will be able to deliver the messages directly to the target audience.
#3 Blockchain Helps in Creating Consumer Profiles Directly from Customers: Hence Better Targeting
Another effect of blockchain on social media is that it has revolutionized how digital marketers build consumer profiles. Therefore, those in consumer behavior monitoring will be able to get all the information that they need from one place. This is from the blockchain data. But how will this happen?
With data decentralization, there will be several sources of information about the consumer. As indicated earlier, there is a greater accuracy level. Secondly, targeting works better since we have all the information needed in one basket.
Therefore, companies monitoring consumer behaviors on social media can rely on the data more than they traditionally did. Better still, you can pay the consumers to provide their information, which reduces the hustle of correcting data. In traditional digital marketing, one had to go the extra mile to fetch consumer data.
Daniel, a Contributor to Forbes, says that “in the past, advertisers gained information about customers from various disparate sources.”. In his article, Daniel notes that blockchain gives marketers the ability to build consumer profiles from the customer directly. Further, there was a great possibility of landing on inaccurate data using the traditional approach. Targeting isn’t as easy, and so you had to cast the nets wider. This increases the possibility of getting incorrect data.
In addition, there is a higher possibility of correcting accurate data as the source is highly credible. Consider the fact that you can as well purchase the consumer information directly. Consumers are ready and willing to serve their data on a silver platter! Consider that these are people more interested in company products or services. Therefore, blockchain on social media marketing offers a better technology for monitoring consumer behavior.
#4 Future Consumer Data Might Become Pricey for Marketers
We have just seen that digital marketers will have to go to the consumers for information. One strategy digital marketers will have to use is, pay for the information. However, there is one major disadvantage of this approach. The consumer determines how much will be paid for the information. Therefore, this will be more expensive for the digital marketer. So what does this mean? The digital marketing Ads will be less profitable. The marketers are then forced to absorb the additional cost of acquiring the information. This ultimately reduces the Ads profitability.
However, consider the fact that those willing to share their information will have more potential of becoming clients. Therefore, the marketers can still generate profits since they are talking to potential clients. This is not ignoring the fact that blockchain is likely to yield more potential prospects compared to a traditional approach.
Basically, consumers have more power when it comes to using blockchain technology in digital marketing. This is a major disruption affecting the adoption of blockchain in digital marketing.
#5 Blockchain Brings Smart Contracts to Digital Marketing
Smart contracts help to keep track of agreement terms. In addition, these smart contracts help to automate the steps towards the fulfillment of each of the terms. We know that for any contract, money is the facilitator and a volatile part of the digital marketing contract. Blockchain technology started in the finance sector. Therefore, implementing the digital marketing space is very easy. The way to do this begins with signing smart contracts. Take for instance a company that contracts digital marketers to ensure increment in the number of impressions. The two agree to the terms and seal the smart contract. Once the terms are met, the fulfillment is confirmed using a digital signature. The funds are then released to the digital marketer. All this is a courtesy of blockchain technology.
Through smart contracts, it becomes easier for digital marketers to offer services to clients across the globe. The marketers are guaranteed their pay, and the contractor is guaranteed the security of their contract. Smart contracts help in saving time, unlike traditional contracts.
On the other side, the contractors feared losing their investment if they paid for service to be delivered later. However, blockchain technology eases the process, and therefore the marketer and contractor get into trusted smart contracts. The marketers are paid, and the contractor doesn’t have to sweat fearing losing their monies. Blockchain technology makes it easier and faster to complete transactions. Marketers can easily receive their payments without having to wait forever.
To Sum Up
Blockchain technology is not only having an impact on the finance industry. The world economy continues to feel the impact on various industries impacted. We have seen reports indicating a lack of transparency in the ads market.
Bots and individuals have been used in traditional marketing to click on ads to increase the statistics. This leads to inaccuracy, and therefore the ads fail to generate the income as projected. Blockchain will bring this to an end. Further blockchain on social media marketing will offer direct-to-consumer marketing. This means that businesses will directly target potential clients in their campaigns. Ultimately, they will have a higher ROI since they target prospects with high potential.
What about direct consumer data profiling? With blockchain on social media marketing, consumers are free to select data availed to digital marketers. Lastly, we can’t ignore the fact that blockchain technology helps drive smart contracts in the digital marketing space. We have seen these in other sectors as well including affiliate marketing.