"Blockchain and Advertising Transparency" - MIT Presentation
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"Blockchain and Advertising Transparency" - As the digital ad industry has grown the ad fraud issue has grown to $16 billion and after 10 years the major executives in the industry say the problem continues to grow and there hasn’t been a complete solution just yet. For example, there was a bot farm that took millions of dollars of revenue from video advertisers and what it did was automatically open the same video over and over and each video view represented $0.05-$0.10 of revenue. So with many millions of automated views the farm took millions of dollars. Clearly, this is an untenable situation. But technology has come of age to solve it, and with the distributed ledger (the blockchain), one can create a tamper-proof record of where ad quality is high and where it is low. An explanation of this paradigm shift is the crux of this presentation.
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"Blockchain and Advertising Transparency" - MIT Presentation
- 3. $209 Billion Global digital media and advertising industry
- 5. 2017 DIGITAL SURPASSES TV $209 BILLION$178 BILLION < Source: Recode
- 6. of Total ad spend by 2020 50% Global digital ad spend will continue to climb to Source: MAGNA
- 7. 10 years on - Ad fraud becoming more pervasive without a complete solution….yet 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 Source: EConsultancy
- 8. Ad Fraud: A quick overview
- 9. Ad Fraud: A quick overview What makes up the world of ad fraud? Ad fraud has one or more of these characteristics: ● Nonhuman traffic (i.e., bots) ○ Bots are able to create fake clicks and fabricated traffic ● Zero chance of being seen (i.e., zero percent viewability) ○ Fraudulent publishers “hide ads” to fit criterion using “ad stacking” or “impression stacking ● Intentional misrepresentation (e.g. site spoofing)
- 10. Source: Zerohedge Methbot - 2016 ● $5 million/day lost to fake ad views ● Bots "watched" as many as 300 million video ads a day ● 6000+ publishers affected z Publishers impacted
- 11. Source: CNBC; WSJ HyphBot - 2017 ● Potentially 3x larger than Methbot ● Created more than 34,000 different domain names and more than a 1M different URLs ● HyphBot cost businesses between $262,000 and $1.28 million a day Publishers impacted
- 12. Ad fraud impacts businesses large and small ● 70 percent of small to medium sized businesses plan to increase their digital marketing budgets. ● Ad fraud can more than double the cost of conversion to a business making advertising unprofitable altogether ● Result is stunted growth of businesses altogether ● Impact to society as a whole Source: Entrepreneur; PPC Protect
- 13. Programmatic accounted for nearly four of every five US digital display dollar spent in 2017. Source: Mediative
- 14. By 2025, the global cost of ad fraud is projected to rise to $50 billion Source: World Federation of Advertisers
- 15. How Do We Make Every Dollar Count...
- 18. It might surprise you to read this, but the most subversive, controversial, anti-authoritarian idea in the world of finance, an idea so powerful every government on the planet is trying to figure out whether to co-opt it or outlaw it, the dream of the most fervent libertarian, dark- Web denizens, is a ledger. Like, an accounting book. - The Truth Machine: The Blockchain and Future of Everything
- 20. Blockchain 101 - how it works
- 24. Shares rose as much as 289 percent after the unprofitable Hicksville, New York-based company rebranded itself Long Blockchain Corp. But maybe not every industry...
- 26. Blockchain will power the paradigm shift for the digital ad industry... Current pain points: Too much work to make media buys from different sources Negotiations and transactions are painfully slow No single marketplace for small and large players Lack of streamlined supply chain in global advertising
- 28. Opening up the programmatic black box for the first time ● Blockchain’s tamper-proof record allows for measurement of ad quality ● Crucial metric, but historically unavailable until now
- 29. ClearCoin uses Blockchain to solve this problem
- 30. ClearCoin works with the supply chain of the $563 billion media and advertising industry. The ClearCoin tokens power its distributed ledger blockchain technology that can improve the supply chain. Building a better supply chain
- 31. The ClearCoin platform tracks all transactions on its distributed proof-of-history ledger to create a system of trust and transparency in the digital advertising community. By recording all digital advertising impressions that the platform has access to, the ledger is able to separate real impressions from fraudulent ones. Creating a system of transparency
- 32. Powering the Blockchain Web ClearCoin is a technology company that powers the real- time buying and selling of media on decentralized applications and the broader digital environment.
- 33. It’s all about creating trust When marketers can monitor ad performance via the blockchain, they can trust the dollars that they spend are translating to genuine performance.
Editor's Notes
- I’m here today to talk about the $209 billion digital media and advertising industry…..
- And it’s $16 billion (and growing) problem. Or 8% of total digital ad spend
- For the last decade digital ad spend has grown. And people have wondered when digital ad spend would surpass that of television. In 2017, global digital ad spend surpassed that of television for the first time in history. This may surprise you considering that a 30 second ad spot runs for $4 million dollars. Even so, digital won. Assets: https://www.shareicon.net/box-television-set-tv-cable-screen-886643 https://www.amazon.com/Terra-App-Movies-Shows-Infos/dp/B077CQV5Y9
- Milestone in trend. And in the coming years, digital ad spend will only continue to grow. By 2020, digital ad spend will make up 50% of all ad spending. And with increased ad spend, analysts project ad fraud will become an even bigger problem for the ad industry. So what does that mean for advertisers, agencies, publishers and the market as a whole? Lets’ start with a quick overview on what constitutes ad fraud.
- After 10 years the major executives in the industry say the problem continues to grow and there hasn’t been a complete solution just yet. Let’s illustrate this problem with some recent examples. https://econsultancy.com/blog/68852-five-ways-marketers-can-use-analytics-to-combat-ad-fraud
- Before we dive into the main issue I’m discussing today, let’s do a quick overview on what exactly is ad fraud.
- Can be a bit of a broad topic but for today and how blockchain fits in - let’s do a quick overview. As ad spend increases, so has ad fraud. So what is ad fraud. There are numerous activities that make up the world of ad fraud: Zero chance of being seen: Ad stacking/Impression stacking: when an ad is hidden behind another ad. In such cases, the publisher generates multiple impressions for a single pageview, but only the top ad is visible -Site spoofing- sends an ad to a site that is different than what they thought they were paying for Ad exchanges give publishers an ad tag that contain a code to identify which domain the user is on. Bad players gain access to a website allowing them to impersonate anyone, advertisers may think that they’re buying top-tier inventory, but the ads will actually show up on substandard properties, such as a leaderboard on an obscure forum.
- To illustrate how big the issue is, let’s take the infamous 2016 announcement from WhiteOps, a cybersecurity firm, announced the discovery of what it described as a "massive and sophisticated fraud operation" that was allegedly siphoning up to $5 million a day in fraudulent impressions from falsified residential IP addresses. https://www.zerohedge.com/news/2016-12-20/meet-methbot-russian-hackers-exposed-biggest-ad-fraud-ever https://www.forbes.com/sites/thomasbrewster/2016/12/20/methbot-biggest-ad-fraud-busted/#33b246244899 https://www.marketingdive.com/news/russian-bot-farm-siphons-up-to-5m-in-digital-ad-revenue-daily/432812/
- More recently, in November of 2017, Denmark-based Adform discovered a large and sophisticated advertising-fraud operation in which fake websites and infected computers were used to scam advertisers and publishers out of upward of hundreds of thousands of dollars a day. This tactic known in the industry as “domain spoofing.” Infected sites include: Economist, the Financial Times, The Wall Street Journal and CNN Image source: https://oarex.com/industry-news/exposed-new-fraud-scheme-dubbed-hyphbot/
- Ad fraud isn’t just making an impact on major industry players. 70% of small businesses said they will increase their digital marketing budgets A $5 conversion could easily double, triple or quadruple when ad fraud takes hold If businneses need to stop ad campaigns because of increased costs, this ultimately stunts the growth of business and kills traffic to their site Ad Frauds impact on all businesses: https://ppcprotect.com/ad-fraud-impact/
- So we’ve talked about this huge problem in the ad industry today and before we get into how we solve this problem, let’s take a look at the world of programmatic and how programmatic works in today’s world. So what is programmatic advertising?!? More than 80% is spent programmatically Source: http://www.mediative.com/problem-of-fraud-in-programmatic/
- Without a concrete solution this is a 3x increase in ad fraud in the factor of billions over the next 7 years. So before we dive further in how to solve this issue, let’s take a step back and review how the world of digital advertising is functioning today, with a focus on programmatic.
- HOW CAN WE ENSURE THAT EVERY DOLLAR COUNTS?
- We are sitting in this room because we either believe or want to know one thing - what will ultimately be Blockchain’s impact on society and business? Satoshi Nakamoto may have introduced bitcoin to the world in 2009, but it’s 2017 that Bitcoin and the Blockchain became a household name. From the start of ICO Mania to daily reports on networks like Bloomberg, MSNBC and even CNN on the rising price of bitcoin and altcoins, its seems that Blockchain became the solution to everything There are even companies questionably putting the word blockchain in their name and seeing shareholder value skyrocket after. For example...
- To introduce how blockchain can solve this multi-billion dollar problem, I’d like to share with you a great quote from a book I’m reading called, The Truth Machine.
- One thing we need to separate is that blockchain is not all about currency: As new cryptocurrencies continue to appear, it has become more evident (not just to industry folks) just how helpful blockchain technology could be to driving transparency in not only currency transactions, but also in a variety of other industries and markets as well. But first, for the uninitiated or those that pretend to understand, what the hell is blockchain?
- So it sounds simple right? To solve this issue we look to this revolutionary technology we just explained is basically an accounting book to solve all our problems. And although you may have heard about blockchain on seemingly a daily basis over the past year, let’s do a quick 101 on how the blockchain works.
- The obvious being the financial use cases we hear everyday…..
- Then there is the Non-financial use cases for a variety of industries. But when you look at the potential for blockchain on a grand scale and who is using it…..It looks something like this
- But when you look at the potential for blockchain on a grand scale and who is using it…..It looks something like this. And this is just the tip of the iceberg. We see this technology having the opportunity to innovate across dozens of market sectors such as: Trading Retail IOT Data e-Identity Legal Publishing And Advertising Thinking we won’t be using blockchain in our business is a bit like thinking that Facebook was just for sharing baby photos back in 2007… It won’t just be a matter of which blockchain technology we use in our business, but how many.
- However, what these sensational headlines detract from are the real-world use cases and implications of blockchain technologies. Take the Long Island Ice Tea companies recent makeover to become Long Blockchain Corp. While this might boost company value, it is pulling attention away from how blockchain and digitized tokens can drive a new open economy.
- What I’m getting at is that Blockchain is a paradigm shift that matters - Creating a once in a lifetime opportunity to reinvent how trillions of dollars of Secondary Market Assets will be managed over their life-cycle, with profound implications for market participants on a global level. And that gets us up to speed to discuss the reason I am up here today. https://www.bonitasoft.com/blockchain-technology-enabling-%20paradigm-shift
- And it will power the paradigm shift for the digital ad industry. Some of the biggest pain points currently in the ad industry is: By nature, advertising is decentralized and requires a large amount of work to make media buys from different sources. This is a time suck and requires larger head count, extra hours and cumbersome work to do something that should be easy Negotiations and transactions in the industry can be very slow. Traditional negotiations combined with the slow speed of money transfers can make the process painful for both the advertiser and the brand. Advertising agencies can also struggle from the lack of a marketplace for their services. Smaller agencies have trouble penetrating a market saturated with large players who make barriers to entry high. Influencers also suffer from a lack of space to market their sponsored content, which is becoming more and more valuable each day with the followings and fan to influencer interactions increasing at a dramatic rate. An additional benefit of blockchain’s application to this industry is its ability to drastically improve the supply chain in global advertising.
- “Programmatic ad buying typically refers to the use of software to purchase digital advertising, as opposed to the traditional process that involves RFPs, human negotiations, and manual insertion orders. It’s using machines to buy ads, basically. So first, lets look at this big complex machine you see here and discuss how all this translate into how we get ads on our screens. And despite the pitalls of ad fraud, why do we keep spending more on these flawed systems? Source: (From Digiday): Definition - We love it for these reasons
- The proof-of-history ledger, or the blockchain, seems to be the much-needed layer to combat ad fraud and inaccuracies. Blockchain’s tamper-proof record will allow us for the first time to measure where ad quality is high and where it is low. We should explain a little bit on how this is done In a world of bot farms, this metric is key, but it has historically been an unmeasurable black box.”
- Our founder Jay Singh has spent decades in the ad industry. As a serial entrepreneur keenly aware of the advantages that blockchain could bring an industry with a real-world problem he set out to build a platform that could tackle this $16bn (and growing) problem.
- ClearCoin works with the supply chain of the $563 billion media and advertising industry. The ClearCoin tokens power its distributed ledger blockchain technology that can improve the supply chain of the rapidly growing media and advertising industry.
- We aim to produce the clearest and most transparent advertising software on the market. We start by connecting advertisers and publishers, tracking all transactions on its distributed proof-of-history ledger to create a system of trust and transparency in the digital advertising community. The ClearCoin platform….
- ClearCoin’s global marketing platform solves this $16+ billion problem ClearCoin is a technology company that powers the real-time buying and selling of media on decentralized applications We start by connecting advertisers and publishers, tracking all transactions on its distributed proof-of-history ledger to create a system of trust and transparency in the digital advertising community.
- Ad fraud has long been a difficult problem for the marketing industry. With ClearCoin’s unique approach of monitoring ad performance via the blockchain, marketers can trust the ad dollars they spend are translating to genuine performance.
- Ad fraud has long been a difficult problem for the marketing industry. With ClearCoin’s unique approach of monitoring ad performance via the blockchain, marketers can trust the ad dollars they spend are translating to genuine performance.