Can Blockchain Improve Trust in Digital Advertising?

Posted on: Monday 12 October 2020 | Integral Ad Science

Integral Ad Science explores the benefits and challenges of implementing an industry-wide blockchain to improve trust within the digital advertising supply chain

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In 2019, UK advertisers spent £15.69 billion on digital advertising, a year-on-year increase of 15.4%, demonstrating confidence in the power of digital advertising to deliver business results. Even with the challenges that the global coronavirus pandemic has brought to the industry in 2020, advertising in digital media is faring better than traditional media. 

Yet, this rapid growth has also brought complexity to the ecosystem, with question marks being raised around transparency and resulting in trust issues between differing players. A recent study from ISBA and PwC explored supply chain transparency, identifying current challenges that need to be addressed in the ecosystem. Doing so is crucial for the sustainability of the digital ad industry as a whole and all players within it, allowing advertisers to invest confidently in the sector. 

In a complex supply chain, each point where data flows among digital participants is a potential point of weakness. A lack of standardisation makes it more difficult to accurately measure a digital ad’s true impact. Yet trust, accurate measurement and attribution are key for advertisers as they look to digital to reach the right customers, in the best way.   

So, where does blockchain come in? 

Blockchain has long been regarded as the technology that could deliver much needed transparency and trust, not only in programmatic advertising but for all advertising environments that rely on multiple intermediaries, across multiple platforms.

Blockchain’s capabilities are destined to create an advertising ecosystem where consistent measurement of advertising transactions is enforced. It has the power to validate the trustworthiness of data in real-time, while providing consumers with more relevant ads and stronger privacy rights. Alongside providing every legitimate player in the ecosystem with a traceable identity, so sources of waste are easily uncovered and eliminated. What’s not to like?

Blockchain: A technology of trust

In its most simple form, blockchain is a network of data records that are managed by multiple parties. Since all parties must agree to any change to the records, blockchain is in its nature, resistant to modification and fully transparent. For every digital transaction, blockchain gathers all records into blocks of data that are signed, authenticated and validated. Blockchain eliminates operational inefficiencies because errors that could only be found post-transaction are flagged in near real-time. Let's take a look at what benefits blockchain can offer to businesses in the digital supply chain.

Transparency & control: As an open record across multiple parties, manipulating data is impossible. While the details are openly recorded, options for creating tiers of access makes the data secure and only available to authorised parties. 

Troubleshooting: The distributed and near real-time nature of the data alerts operations teams when discrepancies arise between delivery systems and media plans. In fact, most technical issues can be identified and resolved more quickly when a shared ledger is making the data readily available. 

Scale: Initially, scale was a limiting factor in blockchain solution, but recent developments have changed the way a shared ledger processes transactions. Earlier models used for popular cryptocurrencies such as Bitcoin and Ether could take several minutes to process a transaction. Today's solutions for recording transactions in ad tech can take as little as a few seconds. 

Validation & verification: Working with vendors on validating ad delivery and performance becomes more streamlined. Blockchain offers powerful tools for verifying factors such as where and when the ad was shown, how the ad was rendered, who saw the ad, and what the viewer did with it. 

Barriers to blockchain adoption

When it comes to adoption, there are several obstacles to overcome before blockchain can reach its full potential.

Collaboration: Blockchain’s main application for digital advertising is to create and scale trust across the industry. This requires collaboration between industry participants in a complex ecosystem. The industry will need to collaborate on blockchain itself, on measurement standards, and how to authenticate digital identities, properties and impressions. 

In advertising, data is the product: Blockchain can protect participants’ data, as well as their methodologies for extracting, transforming, loading, and counting data. But many companies, fearful of losing the intellectual property that defines them, will require convincing before they trust blockchain. 

Constant innovation: Blockchain in advertising will need to be adaptable and scalable enough to work with the many new processes and products that the industry constantly rolls out. 

Speed & size: Most industry applications will need both low latency and extremely high volume, without sacrificing privacy or security. 

Regulation: A blockchain that covers so many digital channels and participants, with sensitive data flowing through so many connections, will require adaptable governance to meet evolving regulatory standards.

Road to success

For blockchain to work at scale it requires a predominance of players in the supply chain to record their transactions using a core set of standards and widely adopted blockchain protocol. In a complex industry with many players of competing interests, success will likely require brands to implement the solution first, then require that their various partners adopt the approach and become part of the system.

With trust being such an important issue for our industry, blockchain could be a critical part of the solution to improve trust in digital advertising. Its ability to conduct trusted transactions, manage and record data securely, and increase automation could help reduce ad fraud, increase data reliability, protect privacy rights, enable better data flows among partners, and deliver the right ads to the right consumers in the right environments. To implement a digital advertising blockchain, the different stakeholders will have to overcome challenges. However now is the time to start the process and find out if blockchain can supply a new foundation to trust in digital advertising.

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Integral Ad Science

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