Most people don’t particularly like being bombarded with ads. In fact, about 85 percent of people feel a negative opinion about websites with unpleasant advertising. It’s already bad enough on TV, public transport, and when driving around town, however the Internet is a minefield of advertising.
Whether you’re browsing your favorite social media site, using a search engine, or something else entirely, chances are you’ll be faced with dozens of ads. And many of them won’t even be relevant, just irritating and seemingly random.
It’s an annoying situation, and it’s down to the centralized, data-based advertising model that big companies like Facebook and Google use. Not only is this strategy annoying for these sites’ users, but it’s also far from ideal for ad companies and content creators.
In fact, the only parties who really benefit are the big platforms themselves, who pull in enormous ad revenues as a result of these methods. But let’s take a look at the cost of this to the other groups involved.
The issues with online advertising
A big chunk of Facebook and Google’s profits come from harvesting the data of their users. While they insist that this data isn’t directly sold to ad companies, it’s still used to help ad companies target and tailor their advertising.
This data is useful because it tells advertisers what users like, what they generally search for, their hobbies, and much more. In theory, it allows them to target ads far more accurately, so potential customers see things they actually want to buy.
In practice, this doesn’t work quite so well, and causes problems for almost everyone involved. Here’s why:
- Advertising companies often end up with inaccurate or mis-sold user data. This means they end up targeting the wrong people with their marketing, so users end up being inundated with irrelevant ads. That means ad companies are paying money to target people who simply aren’t interested — a terrible waste.
- Users get faced with a stream of annoying ads that they don’t care about. These ads are often in ugly and impersonal formats like banner ads. What’s more, even though Facebook and Google make billions from user data, the users don’t get rewarded at all. And they have no say in how their personal data is used or who it’s shared with.
- Content creators spend hours crafting videos, posts, and images to share online on platforms like Facebook and Google. This content attracts the traffic that’s necessary to sell ad space and make money for the big hosting platforms — but the creators often get a meagre reward.
It’s a system where just about everyone loses, while the tech giants make insane profits and go from strength to strength. There has to be a better way of doing this, and that’s what many people in the blockchain space are working on.
What’s the solution?
Companies like Kind Ads and BAT want to build a more pleasant internet, with better methods of advertising. Their goal is to focus on properly and fairly targeted ads, so users can see the products and services they actually want to pay for.
At the same time, ad companies can get higher response rates and ensure their money is spent in a more sensible way.
“Publishers get compensated poorly, and advertisers keep complaining of high fees. And at the end of the day, Facebook and Google keep all the money. This has to change” says Neil Patel of Kind Ads.
The company seeks to remedy this by using blockchain and remove the middleman which is a giant in this niche. Inherently decentralized, blockchain is the perfect antidote to the rampant centralization of Google and Facebook. It can remove the middlemen, so ad companies can interact with users and content creators directly.
The results of this are significant — it means users can own their data again and give it to advertisers in exchange for tokens within the platform. This way, they get paid for their valuable data and gain control over who uses it.
Advertisers can then target ads much more precisely, to people who truly want to see them. It’ll also allow for more personal types of advertising like chatbots and push notifications, which have shown to be more effective and well-received than methods like the dreaded banner ad.
Content creators would benefit, too. In this system they can work directly with advertising companies and get paid a far more reasonable rate for the important service they provide. Without a centralized platform taking all the money, content creators and educators will be able to command a decent income, so they can devote more of their time to making the content their followers love.
Blockchain is still a young technology, and its potential is only just beginning to show itself. In an advertising environment that has been crippled by centralization, blockchain has the power to make a real and lasting difference.
Disclaimer: This is a contributed article and should not be taken as investment advice