Blockchain for programmatic? You must be kidding
A view from Dan Gilbert

Blockchain for programmatic? You must be kidding

Trying to use blockchain to solve programmatic media is excessive use of technology, argues the chief executive and founder of BrainLabs.

What’s the best way to fix the programmatic transparency problem? According to the latest thinking, it’s to use blockchain. In other words, throw even more technology at a problem that is caused in the first place by an excessive use of...er, technology. I call this addressing the symptom not the cause.

The thinking goes that blockchain technology would prohibit agencies/platforms from sneaking extra fees, and misrepresenting performance data. By providing a decentralised, fully transparent record of activity, blockchain certainly could work. And respect where respect is due: anyone attempting to clean up this mess deserves a massive high five. However, I have a much less glamorous suggestion: 

Step 1. Use one DSP.

Step 2. Give clients access.

Step 3. Job done.

I appreciate this won’t get many headlines because it’s not complicated enough to bedazzle advertisers into submission. But It literally could be this easy. Then we could get back to our jobs. Which is marketing, by the way.

Why not blockchain?

First and foremost, it’s an unnecessary cost. The biggest issue with programmatic is that ad tech providers have created extra costs where there needn’t be any, exploiting advertisers who aren’t able to properly assess their value. Blockchain would add yet another cost and complication to an already inefficiently complex ecosystem.

The technology itself, which creates a decentralised digital ledger of transactions, is also untested within this space. There is scepticism as to whether a blockchain platform will be able to process the millions of transactions per second that occur within existing programmatic platforms. The inability of a blockchain network to generate real-time consensus between its users may also cause issues. 

It’s a nice theory, but, like I say, unnecessary and the wrong direction for programmatic. What the industry needs is simplicity, starting with heavy limitations on DSP numbers.

One DSP only 

For every 5% extra reach you get from additional networks, DSPs, meta-DSPs meta-meta-DSPs and data providers, you lose double that in time wasted on complexity, lack of visibility and user journey control.

No surprise that even after all the brand safety malarkey advertisers still don't know how to keep their ads off dodgy sites. With so much digital clutter, it becomes almost impossible to properly monitor the distribution of your ads. How can there be transparency when most programmatic advertisers don’t even know what’s going on themselves! 

A one DSP approach resolves this issue. It also allows an agency to build up a thorough understanding of how the platform works, which means they can optimise their use of it, and better explain its functionality to a client. Ads can be tracked, and costs easily accounted for.

I don’t want to overstate this: of course, if you complete Steps 1-3 above and everyone is happy then it’s OK to start adding other DSPs or networks that add genuine incremental value. Let’s just not do it for the sake of it or because someone actually thinks that ‘reach’ is the problem we’re trying to solve. 

Give clients access

This is as it sounds. Whatever platform you use to run a programmatic campaign, all you need to do is give the advertiser view-only access. Then whatever happens on that account – the good and the bad – will be visible, and there will be no opportunities for non-transparency. 

That means there’s nowhere for the ‘magic mark-up’ button to hide anymore. All the rebates, all the undisclosed costs, all the fudged performance figures are no longer within a black box.

Management fees, data... 

While I’m on a run, why not keep management fees separate to media fees, rather than building it into the platform or media cost? I shared a breakdown of a programmatic spend last year where I talked about this, but just to reiterate.

If you apply management fee post-spend, you make it obvious what the cost of your services actually is. If you add it in via the platform, the fee gets mixed up with all the other costs, creating an easy opportunity for sneaking some extra income. 

And what about data sharing? Please tell me I’m not the only one who insists on account data being the legal property of the client. I really hope not. 

Blockchain AdWords?

Have you ever heard anyone suggest we use blockchain for AdWords? Or Facebook? I very much doubt it. And the reason for that is: they don’t have transparency issues – well, certainly not to the extent that programmatic platforms do.

So how about we think of the success stories of digital as benchmarks, and instead of trying to solve over-complication with further complication, make things simple. Don’t get me wrong, I love programmatic. It’s the future, and it’s going to make advertising a gazillion times better. We just need to tackle the cause rather than fix the symptoms.

To every programmatic advertiser out there: get rid of all the mess, get total visibility into what’s going on, and then we can all get on with the stuff we’re supposed to be doing: marketing.

Dan Gilbert, chief executive and founder of BrainLabs

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