All Fact, No Fiction: The True Story About AI And Blockchain
April 30th, 2018 | ACA Team, Association of Canadian Advertisers
Much of the business world these days is talking about blockchain and artificial intelligence—including advertising and marketing.
And as so often happens with new technology, surging interest has brought a deluge of hyperbole and wild speculation about what the technology can and cannot do.
Trying to make sense of the hype was the key motivation behind the ACA’s recent executive forum in Toronto, with two advertising experts — one specializing in blockchain and the other in AI — there to make sense of both technologies and separate the fact from the fiction.
The morning began with a presentation from Will Luttrell, founder and CEO of Amino Payments, which is using blockchain to bring some much-needed transparency to online advertising.
Luttrell agreed there is a great deal of hype about blockchain, but pointed out that much of that exuberance is about cryptocurrencies and initial coin offerings.
“It is massive speculation,” he said. “Just pure greed.”
Blockchain is not just about Bitcoin or any other cryptocurrency. It has enormous potential as a platform to address some of the biggest problems in advertising today: waste and outright fraud in programmatic ad buying.
The digital ad market has become infected by bad actors creating fake sites and domain spoofing. “That is outright theft,” he said. “But then there exists another challenge, the attrition of value.”
That attrition arises in a system with too many intermediaries leading to confusion and uncertainty about where and how advertiser dollars are being divided.
Many estimates now have as little as 30 cents from each advertiser dollar actually making it to publishers with much of the rest skimmed off by ad technologies.
A lack of transparency is the fundamental problem behind both fraud and attrition — and this is where blockchain comes in.
Transparency is the defining attribute of blockchain. A private blockchain, accessible and open to anyone in an advertiser’s supply chain, would mean every single transaction recorded for everyone else to see. When the advertiser knows exactly what is going in and can see where every penny goes, more informed decisions can be made, said Luttrell. If a DSP is taking 20% of your dollar, if an exchange is taking 20% of your dollar, are they bringing the value that justifies that 20%?
In a Q&A at the end of the session, one attendee bluntly asked why the industry continues to work with a system so riddled by waste and fraud.
“I really do believe that programmatic advertising is the most efficient way to reach your consumers at scale. Hands down. Period,” Luttrell said. “You just have to clean it up.” Solutions to clean it up are starting to emerge, and the application of blockchain could be one of them.
Luttrell was followed by Konrad Feldman, founder and CEO of AI-driven consumer insights and measurement firm Quantcast.
Feldman also began by addressing the hype around his speciality.
“It is possible for something to be overhyped and utterly transformative,” he said. The hype may seem extreme at the moment, but “we are probably underestimating the impact it will have.”
Brands today are struggling to grow while spending more than ever on marketing and technology. Feldman outlined a few of the reasons underlying that growth crisis.
“One is technology being applied for technology’s sake,” he said. Too often marketers hear about a new technology —like AI —race to bring it into the organization and then look for a way to use it. “That is entirely the wrong way around,” he said. Establish clear goals and actions first and then figure out how, or if, technology can help.
Feldman called on marketers to put more first-party data into its AI initiatives — “a lot of third party data is garbage,” he said — and to strive for better performance metrics. “We value what we can measure rather than measure what we value.”
And he wants the industry to be more ambitious with how it uses AI. “What we have done is use technology to speed up the application of conventional wisdom,” he said.
The real opportunity comes from using technology to do new things or things it can handle better than humans, freeing people up to focus on work humans do best. When machines handle all the data crunching, marketing staff can spend more time and focus on strategy and creativity, he said. “It’s going to allow marketers to be marketers again,” he said. “It will empower humans to be more creative and more strategic.”