Analysis Group Affiliate Discusses Future Applications of Blockchain Technology to Digital Advertising in HBR.org Article

May 17, 2018

The business and economics literature abounds with ideas for potential applications of blockchain, the distributed transaction verification technology that rose to prominence with the invention of virtual currencies such as bitcoin. In a new article on the Harvard Business Review website, “What Blockchain Could Mean for Marketing,” Analysis Group affiliate and NYU Stern School of Business Professor Anindya Ghose speculates on how this technology could be applied to digital advertising practice as well.

Professor Ghose summarizes various “pain points” in digital advertising that have bedeviled both brands and consumers. Prominent among these is ad fraud, as when an ad vendor uses bots to generate deceptively high effective click rates for the brand. ­On the customer side, consumers are overwhelmed by ads being overserved to them. There is, Ghose writes, “a disconnect between consumers and marketers with respect to what people want, when they want it, where they want it, and how they want it.”

Blockchain, he argues, “can make data-driven marketing more transparent by validating and analyzing every consumer's journey through verified ad delivery,” by allowing brands to ascertain that they're receiving the services for which they pay vendors. It would also give consumers improved control over how their data are being used. Blockchain, Ghose writes, “has the potential to allow newer ad tech vendors,” such as telecom providers, “a credible chance to compete” against established leaders in the digital advertising market.

Although Professor Ghose notes that “we are still a while away from actual implementation” of this technology in the advertising world, he proposes that newer ad tech vendors consider blockchain's potential in the digital marketing space.

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