How Blockchain Will (and Won’t) Change Marketing
There are really only two reactions anymore to hearing the word “blockchain.”
Reaction 1: You squint, scratch your chin and try to remember what your nephew or coworker told you about Bitcoin. You know, the guy that looks like McLovin from Superbad.
Reaction 2: You sigh and roll your eyes, wishing that everyone in your professional and personal networks would just shut up about this technology that’s supposed to “change our lives” one of these days.
Depending on who you talk to, blockchain as a concept is either an utter mystery or overexposed. There’s little middle ground. But as marketers, should we buy into the hype?
Is it really going to be the second coming of the internet, or is it more like the CrazyBones of this decade?
The jury’s still out on how much will actually change as a result of blockchain’s introduction and adoption, but it does have some pretty interesting implications for marketing. Without getting too deep into the nuts and bolts of how blockchain works, here are a few changes we see on the horizon.
Putting Trust Back in Marketing
One of the most important things about blockchain is that there is no central authority that approves or verifies transactions, the way there is at Scotiabank or RBC. The digital record of a transaction is verified by computers around the world, encrypted, and attached to other blocks in the chain to form a continuous register.
That means fraud is nearly impossible in a well-constructed system. Which puts marketers who like telling the truth back in vogue in a big way.
Imagine having an app in a coffee store that shows consumers the coffee bean supply chain in verified blockchain transactions (“Hey, these beans really did come from the Coffee Triangle in Colombia!”). Not only can you tell a story — you can prove it. Pretty neat!
Blockchain is good news for good companies, and better news for the marketers who support them.
Changing the Relationship Between Marketing, Google and Facebook
If you haven’t noticed, a lot of people are suddenly looking for a way to get off Facebook. Unfortunately, marketers know that Facebook is the epicenter of the online ad world. But what if it didn’t have to be?
One of the other huge advantages of blockchain is privacy. Your online identity is encrypted, and your actions are anonymous. You control your own data. Everyone is just a number — and that should really excite marketers.
Imagine cutting behemoth middle men like Google and Facebook out of the ad targeting world. Motivated parties could create a P2P marketing network made up of advertisers, publishers and consumers — because let’s face it, sometimes ad targeting is useful when you don’t know what vacuum cleaner to buy. Lots of consumers would opt in as long as they controlled their own data.
And they would. The choice to share their attributes with advertisers would be their decision, not Facebook’s. Maybe they would even be rewarded for it with a “marketing cryptocurrency.” More openness, higher reward. The possibilities are endless.
Don’t Get Your Hopes Up For a Fast Roll-out
But for now, they’re just that — possibilities. At times, it might feel like we’re on the verge of another tectonic shift in the industry, just like what happened 25 years ago. But that might be a little optimistic.
For one thing, even well-functioning blockchains still use an insane amount of energy. Adding blocks to the chain takes a tremendous amount of computing power. According to Morgan Stanley, the complex algorithm underlying Bitcoin could eat up more energy than Argentina in 2018.
That’s… a lot of energy.
And it doesn’t get a whole lot better from there. Block processing times are very slow, mostly because of how much energy is still needed to create them. People are working on this, but it’s still not ideal.
Blockchain also took a hit earlier this year when the prices of many popular cryptocurrencies like Bitcoin and Ethereum took a nosedive. That gave detractors more ammunition to prevent their companies from using or even studying the technology. It also gave Facebook and Google license to block cryptocurrency ads on their platforms, in a clear distortion of the marketplace that they still largely control.
And finally, even the private and public blockchains that do exist sometimes don’t have the ability to communicate with others. There are definitely some issues to work out in the next few years.
So what should we do as marketers?
Marketers can be pretty slow to react to shifts in the industry. There are probably people out there just now realizing the benefits of social media marketing. Or discovering that, hey, websites are pretty useful!
Okay, so it’s probably not that bad. But there’s no harm in educating yourself about potential changes in the market and being prepared for them to happen. Watch a YouTube tutorial. Check out an ICO (initial coin offering) for a new cryptocurrency. Read a few more blogs like this one.
Who knows? Maybe a client will ask about using blockchain, and you’ll look like a genius. And if not…..