Blockchain in Marketing And Why It Is The Future?
Cryptocurrencies have made blockchain technology a trending topic worldwide. The journey of blockchain in marketing began with dark web transactions for crypto. However, today the viewpoint has changed, and many businesses view blockchain marketing as the future.
In 1991 blockchain technology was first introduced. It was a concept integrated by a chain of blocks secured by digital time impressions and cryptography impossible to alter. However, the technology became popular only with the induction of cryptocurrencies, particularly Bitcoin.
In this blog, we will understand the concept of blockchain marketing, develop blockchain strategies for businesses and finally evaluate the benefits of blockchain in marketing.
What is Blockchain in Marketing?
Blockchain is a digital ledger used to secure data. The blocks are records or digital information, and chains are databases that keep the data. These blocks are used to secure information like financial transactions, medical records, confidential customer data, and other such information.
Going by the blockchain in marketing definition, it incorporates new marketing and advertising environment. In this method, customers can own and trade data directly for advertising agencies or marketers. Thus, the technique surpasses middle players and provides a direct interaction between brands and consumers.
Blockchain in marketing can provide transparency to customers. It also provides security to brands while building their brand value against fraud. Brands do have an advantage when they have direct interaction with customers.
Why is Blockchain in Marketing Important?
Here are three big reasons that make blockchain in marketing necessary.
Blockchain Provides Transparency
Blockchain is a digital ledger distributed across the users in the blockchain to give access to transactions. The transactions are visible to everyone; however, the identity of the users remains concealed. It enforces businesses to act with integrity and responsibility.
Blockchain Provides Security
The second reason is blockchain marketing provides security through the immutability of data. Each time a transaction is generated, it is encrypted and linked to the previous transaction. As a result, it is impossible to alter the data. Anyone trying to hack will need to change records at all nodes, which becomes practically impossible.
Blockchain Provides Decentralization
Blockchain technology removes the involvement of middlemen like the involvement of the bank in financial transactions. In a blockchain, there is no single source of data. Every node stores information. Decentralizations remove dependency on a single entity and build trust.
In the future, blockchain technology will change the face of the insurance sector, banking, and financial services. It will also have credible face value in healthcare, retail, media, and legal fields.
With changing trends that are prominently visible in the future, businesses must develop a few strategies for blockchain marketing.
1. Social Platforms Based on Blockchain
Social media has been the driving force for marketers for over a decade now. However, social media comes with a cost for providing data. In addition, social media is dependent on ad revenue. Hence they try hard to target to enhance their targeting abilities. With blockchain marketing, the power is in the hands of users. It allows you to build an application on the platform to build communities and monetize your content. It can also allow users to fund open-source projects.
2. Generate Leads
Most marketers have the same strategy to generate leads. They try to get some information and use it to run advertisement campaigns to target potential customers. It’s a great practice until the data is accurate.
With blockchain marketing, you can straight away get customer data that is 100% reliable. A good strategy will be to give incentives to people who will get you the information. It may be a bit expensive, but the knowledge and leads will be accurate to provide you with high dividends.
3. Use Blockchain for Loyalty Programs
Loyalty programs have been a proven strategy for businesses to retain their clients. Customers are also happy with loyalty programs since they get discounts and gifts. Research shows most people are part of at least 10 to 15 loyalty programs. The problem lies with keeping track of loyalty points before they expire. With blockchain marketing, you can have a sophisticated system by decentralization. Multiple brands have an option to collaborate to allow customers to redeem any of the points.
4. Blockchain in Social Commerce
Social commerce is the next thing driven by implementing blockchain in marketing. In addition, it enables faster transactions, prevents fraud, and protects users’ identities. E-commerce and blockchain have a similar application in fraud prevention.
5. Blockchain in Affiliate Marketing
Statistics data reveal that more than $ 6.6 billion are spent every year on affiliate marketing. Yet, despite a large amount spent, businesses are still facing challenges from fraudulent affiliates. It not only incurs a loss to their companies but also has an impact on their brand value.
With blockchain marketing, brands can enhance accountability to counter frauds. In addition, blockchain can use cryptocurrencies to simplify payments apart from getting rid of payment limits.
Benefits of Blockchain in Marketing
Despite being in its budding phase, blockchain technology is predicted for the future of accounting. It is one of the top ten trending topics expected to be in the winning leagues in the future. However, to survive, businesses will have to experiment and match steps with technology to stay.
Here are five advantages of adopting blockchain in marketing.
1. Eliminate Frauds
Statistics reveal that, on average, businesses lose $ 42 billion every year due to fraudulent advertisements. Maximum damage is done by domain spoofing, fraud traffic, and malicious advertising. Blockchain marketing removes the role of intermediaries eliminating the risk of fraud ads. In addition, it provides transparency by keeping only the user, advertiser, and publisher in the network.
A good example is Spring Labs which uses blockchain technology to identify fraud. It helps businesses securely control and share sensitive data without leaking the data.
2. Enhanced Data Security
Data security is one of the biggest concerns for businesses. All businesses must have the means and ways to protect the privacy and data of their clients. Since the induction of GDPR in 2018, companies have been spending a considerable amount on data security. Blockchain marketing has the solution to data security. It gives an advantage to users to sell their data to rands of their choice or keep it discrete.
Blockchain is a secure peer-to-peer technology that provides inherent security. As a result, brands are no longer required to keep a fat sum of money for securing their data. In addition, blockchain in marketing removes the role and cost of the third party. Advertising networks are known to dent a hole in your pocket. With blockchain technology, you know you are paying only for what is there in the terms and conditions.
Blockchain technology allows brands to deal with freelancers, vendors, and publishers directly. Although the initial setup may need some money for design, blockchain will be much more economical in the longer run.
Procedures and paperwork like generating an invoice are time-consuming and monotonous. In addition, the involvement of a third party further delays the process and payments. With blockchain technology, businesses can handle transactions in real-time. Another advantage is that the data and records are available to both parties, and individual data maintenance is not required. With innovative facilities, payments are released as soon as the terms and conditions of the agreements are met.
Coinbase is the largest company that uses blockchain technology to sell cryptocurrencies. It has a market value of US $100 billion. Blockchain in digital technology allows users to sell and buy cryptocurrencies like bitcoin, dogecoin, or other similar currencies.
Traditional mobile apps are controlled by the Play store or similar App store. With a single authority, they can close the app or change the terms and conditions without prior warning. With blockchain marketing, no single source controls the app stores. It provides a level playfield for all. You can build your app and make a community around it. Since there is no control by a single authority, you can connect with your audiences directly.
Blockchain is a new technology, but trends indicate it has enormous potential to grow in the future. Blockchain provides transparency, accessibility of secured data, and decentralization. Now businesses in various fields are looking up to this technology to enhance their businesses.
It should not surprise us that even the marketing industry is gearing up to adopt blockchain technology. It comes with a promise to revolutionize blockchain for digital marketing. As we have seen, there are plenty of reasons for blockchain marketing to come up. If we go by the statistics, blockchain in marketing will be the new trend.
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