It’s not atypical for the tech world to get excited about a technology – and for marketers to get swept into the buzz. But the buzz surrounding blockchain, and its impact on analytics, is worth a closer look.
So here are the basics. Blockchain is a verification protocol that allows valuable assets to move from one entity to another. Blockchain has been commonly associated with digital currencies such as Bitcoin and Ethereum, but the assets do not necessarily have to have a monetary purpose. An asset in a blockchain is essentially data stored in a file or database, so it can be anything from legal contracts to advertising orders.
Blockchain operates as a distributed open ledger system that records movement of assets. Every movement of these assets is called a transaction, with a given related series of transactions stored within a block. Within the ledger system is a series of blocks – this series is literally the “chain” of the blockchain. The blocks are arranged in a sequence.
The block sequence in a blockchain relies on hashes to identify the chain. A hash is a link from the parent block to a subsequent block. The hash is unique and computed based on the contents within the block.
There are two key points at which blockchain can impact analytics:
- One opportunity arises from data that exists as a blockchain asset. Accessing blockchain assets leads to regulatory and operational analytics opportunities such as fraud detection or customer verification
- The second opportunity comes from data in movement within the blockchain environment. The activity created by the parties involved in a blockchain is called event generation. Event generation, can provide a stream of real-time data to be analyzed. For analytics this means a traditional data collection point, an event form, is replaced in the analytic planning by the transaction processes that an event generation creates. The result is real-time analytics for any blockchain activity.
The benefits exist both for a public blockchain – of which cryptocurrency is an example – and a private blockchain used among a group of organizations. But it’s the private usage that holds particular promise from an analytics perspective.
A blockchain within a private network, such as financial and medical institutions, provides members making transactions with a trusted platform. Big data analytics can help predict spending patterns, establishing machine learning responses for the assets involved, and ultimately reducing the time in which business activities become visible. Up until now organizations had to detect anomalies through retroactively reviewing data and metrics. In instances of fraud analysis, that can consume precious time.
For marketers, much of blockchain’s immediate benefit lies in verification. In the case of advertising that means a stronger ability to verify ad delivery on the planned platform, and engagement on delivered ads, as well as helping avoid overserving the same ads to a target audience.
That stronger ability arrives at a time when digital marketers are increasingly distrustful of ad performance against precious campaign budgets. Incidents of ad fraud, click fraud, and a general distrust of the value of traffic sources, has marketers seeking better tools to ensure that real people online see their campaigns.
Developers are learning how to create blockchain details in programming language they are familiar with. They are learning to carry the hash, timestamp, and transactions within widely available programming, such as R, Python, and Node.JS. These programming frameworks help developers envision where hashes and information are placed for a viable blockchain arrangement. Marketers should align with developers to research how these efforts suggest how an analytics script fits against the programming structure for a blockchain.
Blockchain has the potential to play a major role in establishing trust on the internet – a significant factor in the aftermath of social media’s role in political discord. As many digital systems like ad programmatics are increasing the complexity of the environment, marketers will turn to blockchains to raise accountability to new heights.
