As technology advances, new platforms are becoming popular among people. Flashback to ten years ago, technology has never been this occupied in the online world. Many would still rely on conventional approaches when solving a problem.
For example, online transaction has been a lot easier in the past few years. With mobile devices improving their features, people can spend money at their fingertips within a few minutes. Today, conventional banks are evolving and more accommodating to customers. That said, technology has helped people improve their lives and solve many things.
The digital marketing industry is also evolving. The emergence of new technology has helped this industry grow and gain more investors’ interest. One of the most popular technologies in today’s world is blockchain. This new technology can disrupt the digital marketing industry in many ways and has become a necessity for businesses.
Many people have heard about blockchain but do not know what it means, how it works, or why they should use it. If you are one of those people, you have come to the right place, as we will discuss these topics in this article. Let us begin!
What is Blockchain?
Blockchain is a decentralized ledger that records all transactions between two parties efficiently and permanently. It was originally created for Bitcoin, a cryptocurrency, but has been used for other applications such as banking, finance, accounting, and digital marketing. There are many benefits of using blockchain in digital marketing, including improved security and data transparency, among other things.
Blockchain can be used to store any type of data, from financial records to personal information such as identification numbers or social security numbers. It stores valuable information that needs protection from unauthorized accesses like cyber criminals or hackers always trying to obtain sensitive information such as credit card details or social security numbers.
As mentioned above, blockchain is decentralized, which means there is no single party controlling the ledger but everyone using it within the network. It is also transparent, meaning anyone can see the information stored on the blockchain.
Pros and Cons of Blockchain
Some largest businesses in the world have used blockchain technology because it has the potential to disrupt the current technology and system. The article states that businesses have started using blockchain technology for everything from protecting digital identities and storing data to managing supply chains, verifying transactions, and creating digital currencies.
Blockchain is also allowing companies to cut out middlemen, like banks and payment processors, which will significantly decrease their costs. For example, one of the first large-scale uses of blockchain technology was in bitcoin (a digital currency), which allowed users to make payments directly with each other without having to use a bank or other payment processor.
The Pros:
- No third party or middleman is required to verify transactions.
- Blockchain is a permanent and transparent record of all transactions that have ever occurred.
- Blockchain technology is decentralized, meaning there’s no one controlling it. It’s controlled by the users of the network.
The Cons:
- Potential security risks and hacks because blockchain technology hasn’t been fully tested yet.
- Some people don’t trust or like the idea of a public ledger stored on thousands of computers around the world where anyone can see their transaction history or balance.
- Blockchain technology is in its early stages, so it could be years before we see widespread adoption by businesses, consumers, and governments.
Blockchain and Digital Marketing
Blockchain technology has been used in digital marketing since 2012, with the first-ever purchase of Bitcoins using blockchain. The idea was to create a decentralized and transparent system that would eliminate fraud and improve security.
Blockchain is a perfect medium for digital marketing as it allows marketers to track the activities of their target audience and get insights into their behaviors without having to pay any third party for this information.
A blockchain is essentially a distributed database that maintains a growing list of ordered records called blocks. Each block contains information about transactions and is linked to the previous block, hence the name blockchain.
A blockchain consists of three layers:
1. The data layer
The first layer, known as the data layer, records all of the transactions that take place on the blockchain. It is responsible for storing data in a transparent and decentralized manner. This layer acts as an intermediary between different parties participating in a transaction, such as customers, merchants, and service providers.
2. The smart contract
The second layer stores smart contracts or scripts to automate transactions on the blockchain for various purposes such as payments, escrow services, etc.
A smart contract can be defined as a computer protocol intended to digitally facilitate, verify or enforce the negotiation or performance of a contract without third parties being involved or interfering with this process.
Smart contracts contain all terms agreed upon by both parties involved in the digital marketing campaign at inception. This helps marketers eliminate any third-party involvement in their campaigns, thereby reducing costs substantially while maintaining transparency throughout their campaign cycles.
3. The application
The third and final layer is known as applications. Applications are used to develop decentralized apps (dApps), which enable users to interact with the network without any central authority governing it.
Blockchain technology enables marketers to develop transparent and secure marketing campaigns by utilizing applications that can be used to fully authorize marketing campaigns when handling clients.
How Blockchain Technology Impacts Digital Marketing
You’d be surprised how this technology has impacted the digital marketing industry since it was established. Blockchain has supported marketers in a number of ways.
The following are some ways blockchain can be used in digital marketing:
1. Create Digital IDs
Blockchain can be used to create digital IDs for an individual or a business. Digital IDs help marketers and advertisers track the activities of their target audience. For example, if a marketer wants to target a consumer, they can create a digital ID for the consumer and then use it to track the consumer’s online activities.
Digital ID helps businesses improve their marketing strategies by getting information about their potential customers and then using this data to create targeted ads. Digital IDs also help businesses improve the security of their platforms as they can track any suspicious activity on the platform, which helps them protect their users’ data. For this reason, hire blockchain developers that not only design great websites but also understand the importance of the security of user data
2. Create and Track Digital Ads/Campaigns
Digital advertising is one of the fastest-growing sectors in the digital marketing industry. Blockchain can be used to create a secure, transparent, and decentralized system for digital advertising, allowing marketers to track their adverts and see how many people have viewed them and how many of these people have made purchases as a result of seeing their adverts.
Blockchain also allows marketers to track the ads and campaigns they have created to see how effective they are in terms of the number of clicks, conversions, etc. It also allows them to see how much each campaign costs them and if the campaign is worth investing more in the future.
3. Improve Data Management
Blockchain technology can be used to manage data created by marketers during their campaigns. Blockchain allows marketers to track their data across multiple platforms, gives them access to it whenever they want it, and adds extra information about their campaigns that would not normally be available using other digital marketing systems.
For example, blockchain technology could be used by a marketer who runs an email campaign but also has an offline sales team selling products through face-to-face marketing or telephone calls. By using blockchain technology, the marketer can add information about their offline sales team to the blockchain.
This means that when they send out emails during their campaign, they will know how many sales have been made from these emails as well as from face-to-face or telephone sales with no need for third-party companies. This makes it possible for marketers to get more insights into how effective their campaigns are.
4. Gather Accurate Leads
Since blockchain allows you to create customer IDs, marketers can gather accurate leads. This means that marketers can send out a single email to numerous customers and know exactly who is opening their emails, clicking on their links, and purchasing from their websites.
In addition, it is much easier to track the user journey of each of these leads by using blockchain technology. For example, if a user visits your website but doesn’t make a purchase, you can add this information into the blockchain so that you know not only whether they have opened your email but also whether they have visited your website.
5. Increase Transparency
Blockchain technology makes it easy for marketers to track the success of individual transactions by giving them access to more data about each transaction in real-time. Instead of looking at large amounts of data at once, marketers can see this data in small chunks, making it easier for them to identify patterns within the data or anomalies.
It also means that marketing teams can respond quickly when issues arise in an individual transaction. Or, they can respond when large numbers of issues arise at once, which could be too late for some companies.
Takeaway
Sooner or later, businesses will use blockchain technology to amplify their performance because it allows them to build a complete view of their customer. And with this information, they will be able to make more accurate decisions, increase transparency and be more efficient in their marketing strategies.
That said, blockchain technology will likely dominate digital marketing in the future as businesses begin to realize their potential. But while blockchain technology offers businesses many benefits, you must first understand how it works before you can begin implementing it into your business operations.
Author
Andre Oentoro is the founder of Breadnbeyond, an award-winning explainer video production company. He helps businesses increase conversion rates, close more sales, and get positive ROI from explainer videos (in that order).
Twitter: @breadnbeyond
Email/Gravatar: [email protected]
LinkedIn: Andre Oentoro
