Why Does Amazon Want To Hire Blockchain Experts For Its Ads Division?
Earlier this month, Amazon announced plans to hire blockchain experts for its advertising division. But how can the use of blockchain technology possibly resolve the pain points in the advertising industry? Why Does Amazon Want To Hire Blockchain Experts For Its Ads Division?
For the crypto industry, which is worth more than $240 billion, you’d think standard business tools like a shared database would be de rigueur in the digital advertising industry — but you’d be wrong. In reality, the industry uses very outdated, manual, time-consuming processes when it comes to selling, payment, verification and other critical functions.
New Tools For Digital Advertisers
It is time to introduce a better framework for digital advertisers, a platform without bias and with a common set of rules. Fortunately, blockchain technology is ideally suited to address issues of transparency, trust, verification, efficiency and complexity, all of which currently plague the digital advertising industry.
Smart contracts, in their simplest form, are vending machines — two parties agreeing to a set of terms and each party paid with either goods or services. Buying and selling digital advertising is more complicated but isn’t any different.
Marketers today use a paper or digital insertion order for contracted terms of their ad buys, but they aren’t trackable or enforceable. Blockchain-based smart contracts can resolve these issues with a programmatic approach.
These smart contracts enforce what an advertiser is buying and allows the verification to take place during the reconciliation process at the end of the campaign. These efficiencies alone are monumental in allowing advertisers to actually get what they pay for on top of payouts to the supplier within the agreed upon time.
An ideal system provides the opportunity to tokenize the framework to treat digital advertising as a true asset class, standardizing the valuation of ads. This, in tandem with the structure of blockchain, keeps decentralization as a top priority.
This provides incentives for running a full node and validating transactions within an ecosystem instead of trusting an inherently biased third party (e.g., Facebook and Google). These third parties have a huge influence on market pricing due to their pervasiveness and can cause immediate shockwaves throughout the entire industry.
In 2018, both tech behemoths took a strong stance against the crypto sphere when Google announced a ban on all cryptocurrency-related advertising while Facebook made a similar move months prior before later renouncing it.
Citing user protection, censoring advertisers with the intention of protecting against scammers following the initial coin offering craze, these companies could greatly benefit from integrating blockchain solutions to safeguard their advertising spend.
Blockchain For Advertisement
While it appears Amazon recognizes the value of blockchain at the foundation level of its advertising model — for billing and reconciliation — it is only a matter of time before it is enlightened of the numerous other ways it can be used to increase efficiency and protect ad spend through tokenization.
At this early stage of blockchain, it’s unlikely that major brands — along with their large budgets — will want to pay in some unconventional way like a token.
Integrations within the platform are needed to ensure adoption and to facilitate the movement of traditional currencies through these smart contract insertion orders.
The digital advertising ecosystem is ripe for a revolution, and blockchain holds the most promising keys.
What Makes Amazon Different From Other Tech Behemoths?
Amazon needs to do something to differentiate itself from Facebook and Google, which currently dwarf its advertising platform. If Amazon were able to provide efficiencies around Facebook’s and Google’s shortcomings, it would be able to siphon off some of the market share from the other ad platform giants.
Smart contracts with logical insertion orders can contain any logic that the blockchain would support. Targetability within that logic can be a game changer in regard to what’s actually being delivered. This cures a lot of questionable tactics many advertising networks use to secure the delivery of a campaign. With 100% transparency on the smart contract insertion order and terms placed within it, there is no tampering or delivering something the client didn’t order. Verification of purchase is needed within this industry, and blockchain (along with layered logic through smart contracts) solves these issues.
In addition to pairing smart contracts and payment reconciliation efforts, integrations within a blockchain can be endless, and provide additional insight and value. Adding a measurement provider into a smart contract allows additional transparency to all parties. In this measurement provider example, a demand-side client wants to only be billed for a very specific downstream event, like signups. If everyone is on the same page in terms of what is being delivered, it rules out discrepancies, allows for a more successful campaign to be delivered and payment to be expedited.
Fraud can’t totally be solved by implementing blockchain alone, but it can track publisher identity along with governance. Identity at scale is something that this industry won’t see until this new technology is implemented.
The digital advertising vertical has grown very quickly and essentially created an overlap in regard to bidding or, to some extent, competing with yourself by purchasing media on multiple platforms. Governance within a blockchain is something that can improve what we’re dealing with today.
As an industry, we can all agree on certain aspects or actions that would be considered fraud. A click from an Android user that installs an application only meant for an iOS device shouldn’t ever be billed or valid.
In this example, that logic — along with others — could be built into a smart contract to enforce only true iOS installs vs. mismatched installs. Also, by tracking identity, blockchain networks could include or exclude publishers or users that create issues or are fraudulent within the ecosystem.
Amazon is trying to make its mark in the digital advertising ecosystem, and to get there, it needs to innovate and outpace the major platforms of today — i.e., Facebook and Google. It seems clear that Amazon knows its internal chain supply, but how it implements it in the advertising ecosystem will be the key to its success.
The views, thoughts and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
Matthew Hrushka is product marketing manager at Xchng. Matt has been involved in the cryptocurrency space since 2015 and has a deep knowledge about distributed ledger technologies including blockchain. Additionally, Matt’s professional experience in the digital advertising space makes him uniquely qualified to understand the application of blockchain to this particular industry. Matt previously served as the mobile marketing manager at Rosetta Stone and before that, was the ad operations manager at Verve Mobile. Matt is the primary contact for the OnXchng Partner Program and is passionate about bringing new partners into the Xchng project. Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want
Blockchain Expands In Advertising Industry, But Crypto Remains A No Go
Crypto has been left out of the advertising industry, but blockchain technology may be its ticket back in to innovate and change the space.
Despite seeing substantial growth in popularity, topping Google search trends amid the recent halving, the coronavirus pandemic and mainstream coverage, the cryptocurrency industry has somewhat been left out of the advertising world by online ad networks, social media platforms and even national governments.
In 2018, Facebook banned cryptocurrency advertising amid the initial coin offering hype. Later that year in March, Google followed, banning all advertisements of cryptocurrencies, especially ICOs, and binary options. In the same month, Twitter also banned all cryptocurrency advertising, except for a few public companies.
Several social networks in China also applied bans to crypto advertising, following the introduction of restrictions by the Chinese government. These bans, of course, were not random attacks on crypto but rather a blanket measure to prevent scams and illegal fundraisers from acquiring users through these platforms.
In fact, it is possible to advertise on Facebook, for example, if the user files a formal request with Facebook.
This measure is used to force potential scammers to go to Facebook rather than the opposite. Milo McCloud, the creative director at Paradox Group — a crypto-focused marketing agency — told Cointelegraph:
“With recent developments on both [Google ads and Facebook] platforms allowing for blockchain-related content to be advertised only after undergoing heavy scrutiny, it is the first step in the right direction to the mainstream acceptance of blockchain technology as an important industry that can tackle many problems we currently are facing.”
The Aftermath Of The Crypto Adpocalypse
The industry fought back against the many bans and restrictions on cryptocurrency-related advertising. In fact, several companies in Russia, China and South Korea have banded together to form the Eurasian Association Of Blockchain and subsequently filed a lawsuit against some of the social media companies behind the bans.
Although things have somewhat improved for cryptocurrency advertisers and publishers, there are still many restrictions. Tanya Petrusenko, the head of business development at Bitmedia — a crypto advertising network — told Cointelegraph:
“Today, things have changed, and now they allow some ads, but in order to launch a campaign, a crypto company should undergo a number of procedures, show multiple licenses, and there’s still no guarantee that even if everything is ok, Google or Facebook will approve the ad in the end.
This limits marketing freedom for many businesses because even if someone runs a shop where crypto is used as means of payment, it will be difficult for them to advertise it using traditional digital channels.”
Innovating Out Of Necessity
Given the bans on major advertising networks, the booming crypto industry has been forced to adapt. Several crypto-centric networks, along with many other marketing and PR agencies, have been created to fulfill the demand of advertisers in the space, as well as to improve the earnings of crypto-centric publishers, by making ads more targeted and relevant. Tiberiu Stingaciu, the CEO of Coinzilla — a crypto advertising network — told Cointelegraph:
“Being a niche sector, the crypto advertising industry primarily focuses on solidifying partnerships with major fin-tech publishers. This helps broaden the potential audience advertisers can reach. At the same time, a lot of work is being put into more technologically advanced advertising tools such as programmatic advertising, RTB, and overall optimization of the advertising campaigns.”
While advertising companies and even publishers have been able to circumvent these restrictions and even innovate within their own right, the issues within the advertising industry extend far beyond the world of cryptocurrencies and blockchain technology.
Centralization of the industry by IT giants like Google and Facebook has led to a lack of any real threatening competition and no reason to strive for improvement. However, some blockchain projects have been trying to find ways to appeal to advertisers, publishers and the advertising audience to benefit greatly, creating an incentive for significant changes to be made.
The Many Challenges In The Online Ad Industry
There are many fundamental issues in the advertising network like an overabundance of middlemen and third-party service providers that are required to navigate the space to a lack of transparency and even advertising fraud which is rampant in the industry.
As Cointelegraph previously discussed, only around $0.35 for every dollar of advertising revenue makes it to the publishers, which, of course, leads to lower revenue for publishers and higher prices for advertisers.
Advertising fraud is also a major issue in the industry, as $44 billion will be lost to ad fraud by 2022, which creates major losses on all sides, including the end-user, and leads to even higher prices for advertisers. Transparency is also a major issue even when actual fraud is not involved. Advertisers may have little notion of how their money is being spent as Petrusenko explained:
“I believe that transparency is and has been the main issue. The lack of knowledge as to where advertiser’s money goes opens a large loophole for fraudulent traffic. Censorship is another huge issue now because traditional ad networks are restricting many ads especially when the subject relates to crypto. This prevents many online businesses from growth and drastically limits their reach.”
Along with these issues, consumers have also grown increasingly concerned with their privacy even when it comes to online advertising. The aforementioned tech giants glean an immense amount of data from and about their users and their preferences.
While this does lead to more targeted advertisements, it’s usually not very welcomed by the consumers whose data is “sold” without their full knowledge or consent or even the possibility of monetizing said data. Stingaciu told Cointelegraph that adblockers have become an issue, as “users are oversaturated with ads from all directions, and more are turning to adblockers to escape the barrage of ads coming their way.”
Blockchain Tech In The Ad Industry
Although crypto has been left out of the industry, blockchain technology has been making waves in the digital advertising space in the same ways it is doing so in many other industries: by eliminating unnecessary middlemen, streamlining direct relationships between the contributing parties, and providing monetization tools.
Companies aim to cut the middlemen by providing a self-service platform built on top of a blockchain network. Ivan Manchev, the communications manager at AdEx Network, explained how this system makes use of the Ethereum blockchain in a conversation with Cointelegraph:
“On a self-serve platform, advertisers can start a display ad campaign in less than five minutes and send their ads to targeted publishers,” adding: “Both parties receive real-time reporting, and payments flow directly between them once impressions are verified.”
Another company in the space, the Brave web browser, has tried a different approach, positioning itself as a competitor to Chrome and other browsers. It has created a utility token known as Basic Attention Token, which serves as an incentive mechanism for users to share their data with advertisers. Brave browser enforces this by offering users more privacy by blocking online trackers.
While Brave is indeed an innovative solution and has been gaining traction, it certainly has its flaws. Recent reports of links being replaced with referrals have been made. And while these do not have a devastating effect on the end-users, this has forced the company to apologize and removed this function.
Other blockchain-backed ventures like All.me and Atayen have also been pushing this type of model forward. All.me, a digital network featuring a built-in wallet and exchange, aims to share 50% of all advertising revenue with its 600,000 users.
The Smart Advertising Transaction Token, or SATT, was created by Atayen to reward influencers and other users who create customized advertising campaigns, as well as to receive payments directly, which targets a more niche corner of the ad industry with a similar model as Brave’s.
What The Future Holds For Crypto And Advertising
Will blockchain technology be able to change online advertising? While the outlook is extremely promising, these alternatives have a long way to go when it comes to competing with giants like Google or Facebook, which dominate the online advertising market, given their massive user base and reach.
Nevertheless, there are many signs that point to the growing use of blockchain technology in the advertising industry. For example, Brave browser has recently joined the instant global payments network PayID, and IBM has even partnered with big advertisers to create a blockchain-based solution to reduce inefficiency and fraud and improve the digital advertising industry.
According to Manchev, blockchain technology’s immutability and direct payment capabilities can truly revolutionize the world of online advertising, telling Cointelegraph:
“The immutability of the data and the consensus on instructions and payment terms pre-delivery can help reduce the supply chain steps and decrease costs for advertisers and publishers. On the other hand, crypto payments can introduce new payment methods. […] This can increase publishers’ liquidity, eliminate the need of custody of funds by ad networks, and increase security for both parties.”
As blockchain technology continues to take over the advertising industry and as crypto itself continues to strive for a more regulated and transparent market, it is likely that cryptocurrency companies will be once more allowed back in the “advertising party” and be able to target a more mainstream audience, which may be imperative for mainstream adoption of Bitcoin (BTC) and crypto as a whole.
Amazon Seeks New Exec To Oversee Digital Currency Strategy
The new Amazon position requires a deep understanding of the digital currency and cryptocurrency ecosystems and related technologies.
Tech giant Amazon is looking to dive into digital currency and blockchain development with a new major hire within its payments-focused team.
Amazon’s payments acceptance and experience team is seeking a digital currency and blockchain product lead to develop the company’s strategy of digital currency and blockchain as well as a product roadmap. The team is responsible for Amazon’s customers’ payments on Amazon’s sites and through its global services.
Posted on Thursday, the new role seeks an experienced product leader with expertise in blockchain, central bank digital currencies and cryptocurrencies to “develop the case for the capabilities which should be developed” and drive overall product vision.
The new Amazon digital currency lead will work closely with teams across Amazon to design the roadmap, including the customer experience, technical strategy and capabilities, the posting notes.
The application requires a set of industry-related qualifications, including a “deep understanding” of the digital currency and cryptocurrency ecosystems and related technologies.
It appears unclear whether Amazon is considering launching its own digital currency as part of its payment acceptance process with the new position. The firm did not immediately respond to Cointelegraph’s request for comment.
The latest job posting reaffirms Amazon’s growing attention to digital currency, as the company has been apparently developing a new service to allow its customers to shop using digital currency. Earlier this year, Amazon posted a job application to launch a new digital payment product known as “Digital and Emerging Payments,” initially planning to roll out the initiative in Mexico.
Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,Why Does Amazon Want,