Why blockchain is the key to sustainable advertising and customer acquisition | Lancelot LDN | Open Mic

by Arthur · February 28, 2023

Ad fraud is one of the main problems in digital advertising. And everyone knows about it. Yet few are willing to do anything about it.

The latest estimates project that global programmatic advertising spending will reach $726 billion by 2026. By 2022, the amount spent was over $490 billion. So, as you can see, we’re talking big bucks here. And in the US alone, the amount lost to ad fraud is expected to reach $81 billion by 2022, which is over 30% of total programmatic advertising spend last year, according to Statista.

The programmatic process of serving ads before our eyes is a fierce auction battle between brands, each bidding at a higher price to get the top spot and get their ads shown first. At the same time, it is also easily damaged. Pixel stuffing, ad stacking and other tactics are used to steal brands and agencies’ money, most of the time without being noticed. Ads are being shown to bots, appearing in invalid URLs, geos, etc. – and many times there is absolutely no visibility of this in the campaign reports.

But blockchain can be a strong ally in tackling these problems. The ability to provide immutable and bulletproof analytics to actually show the truth behind the numbers can be the first and most reliable step to start fighting ad fraud. Adwatch, for example, is a pioneer in certifying programmatic campaigns using this technology. By wrapping campaign tags and securing them in the blockchain, advertisers can be sure that absolutely no one can tamper with their ads. Any calculations collected from each asset are also encrypted in the blockchain, which in turn provides an immutable ledger that cannot be changed at any time. All data is tracked and accounted for, which provides full transparency in the process.

And because it’s Ethereum-based, it means it consumes less energy than other blockchains.

Reducing ad fraud results in more efficient and effective advertising, which in itself leads to less energy consumption, and thus a reduced carbon footprint. Fewer ads are displayed, less energy consumption and still efficient effect. According to recent studies, the average digital ad emissions are 670g CO2 per thousand impressions, and when you add up the trillions of digital impressions the industry places every year, that’s a lot of CO2. So by reducing ad fraud and unnecessary ad impressions, we’re actually helping the planet.

Here is another example. Telefonica, Spain’s largest telephone company which recently partnered with Adwatch through Telefonica Tech, has created a system that now allows the multinational giant to detect anomalies and therefore have a more sustainable customer acquisition, optimize the advertising budget and reduce losses to fraud.

Look at some past examples: P&G, Chase, Uber, and eBay have shut down or paused programmatic campaigns and seen no change in their bottom line in terms of customer acquisition or web traffic, shedding light on how much money and energy is being wasted lost in fraud. Ads that affect absolutely no one, and brand investment channeled into the pockets of fraudsters.

These facts prove that brands’ customer acquisition can be more sustainable, ad campaigns and ad spend can be optimized, and still deliver the same results in traffic and sales. And it undoubtedly confirms blockchain as a more sustainable technology compared to others, with huge benefits for businesses and the environment, leveraging its decentralized nature to provide secure, immutable and reliable data and insights, those that can be our most powerful weapon against ad fraud.