Yesterday, blockchain advertising consortium AdLedger and blockchain video ad firm MadHive published the ‘State of AdTech Study’. The report discussed the use of technology in the industry and found that only 6% of respondents were satisfied with the current state of digital advertising.
The research was conducted by the Industry Index, which surveyed 100 brands, agencies, and digital publishers. Digital advertising, though revolutionary in a sense, lacks efficiency.
For example, internet ads are based on pay per click, but the actual conversion rate may vary as some of them may be bots. The biggest issue is the lack of trust, as there are very few tools available to audit an advertising campaign. AdLedger found that 92% of the respondents believe there is a need for industry-wide standardization.
“Digital advertising is still suffering from the same issues of transparency, fraud, and fragmentation,” said Christiana Cacciapuoti, Executive Director at AdLedger. “And it’s because we just keep slapping band-aids on a fundamentally broken system when we need to be developing a new infrastructure that’s driven by innovative technologies.”
Meanwhile, 83% of respondents said blockchain could increase transparency and efficiency. Of these, 66% believe that distributed ledger technology (DLT) could reduce fraud and efficiently track results.
“Sooner or later, the industry is going to realize that this dysfunctional relationship has got to end, and the only way to fix it is with next-generation technologies,” said Adam Helfgott, CEO at MadHive.
Overall, the advertising industry seems positive about adopting blockchain, and 72% of respondents feel there will be significant integrations in the next five years.
Last year, a Gartner study found that blockchain for advertising was an emerging trend, albeit in a nascent stage.
The AdLedger consortium is a non-profit organization founded by MadHive, TEGNA, and IBM. It currently has members such as Omnicom’s OMG, Publicis’s Publicis Media, IPG’s Reprise Digital, WPP’s GroupM, The Hershey Company, Meredith, Hearst and 50 other key industry stakeholders.
One of AdLedger’s initial projects involved a proof of concept (PoC) with Salon magazine and IBM, for ad campaign reconciliation.
Meanwhile, MadHive offers a suite of technologies for media planning, data management, matching and campaign optimization to the advertising industry. It has previously worked with TEGNA’s Premion to increase audience targeting and verify ad delivery using AI, blockchain and cryptography.
IBM has a blockchain advertising initiative with Mediaocean, which is also a founding member of AdLedger. Mediaocean’s platform went live last year and logs transactions such as budget, authorization, orders, verification, invoices and payments.