This Cryptocurrency Is Challenging Facebook And Google's Advertising Duopoly

The global advertising industry in its current setup is fundamentally flawed.

The current setup of the global ads industry is centralized and only handful of companies determine how the market operates. Google and Facebook have a duopoly of sorts as both companies accounted for a combined 61% of the global ad spend in 2017. In FY 2017, Facebook reported that its total ads revenue was around $39.9B and Google’s ad revenue in the same period was around $95.4B.

The fact that only two companies control the bulk of the digital ads market gives them a duopoly of sorts in which they dictate the terms that other stakeholders must follow.

The duopoly of Google and Facebook has seen ad spend growing rapidly in the last couple of years. Forecasts from Zenith Online shows that social media ad spend will increase by 21% to $58B while video ad spend is expected to jump by 19% to $32B this year. Advertisers simply need to spend more money to get their ads in the face of their target audience.

Increasing ad spend doesn’t guarantee decent ROI

Unfortunately for advertisers, increasing your ad spend doesn’t necessarily mean that the attention of your target audience is guaranteed. For instance, the average click-through rate (CTR) in Google Adwords across all industries is 3.17% and 0.46% on the display network (see infographic below). Facebook advertisers have it worse with an average clickthrough rate of 0.90% across all industries.

Many of today’s ads feel intrusive, hence many people have learnt to ignore ads or stop them completely by installing ad blockers on their browsers.

Thirdly, people who create the content that often serves as the driving force behind the ads rarely get paid enough or at all for their content. Some platform such as Google’s YouTube and Facebook’s Instagram pay content creators signed up on their ad networks.

However, for the most part regular users don’t get paid for the content their produce. This piece examines how blockchain technology could decentralize the digital advertising industry.

Kind Ads to challenge Google and Facebook’s ad dominance

The advertising industry is flawed but blockchain technology is coming to the rescue by facilitating a disruption of epic proportions.

Blockchain technology has proven to be a gamechanger causing a paradigm shift across economies, markets, and industries. Kind Ads, a brainchild of The Leadchain Foundation is setting up shop to leverage blockchain technology to challenge the dominance of Google and Facebook in the digital advertisement industry.

Blockchain technology is fundamentally decentralized and Kind Ads believe that the decentralization is the key to connecting advertisers directly to publishers and users. A decentralized peer-to-peer advertising ecosystem allows advertisers an opportunity to deal directly with publishers without going through intermediaries such as Google or Facebook.

In other words, cutting down the platform fees for advertising or big revenue share of the duopoly will leave publishers and advertisers with most of the money this time around.

Under the current ads setup, an advertiser technically needs to buy ad spots from Google, Facebook, or some other ad networks. The ad network then places the ads on online properties – the fee paid by the advertiser is dependent on factors such as type of ad, industry, and where you want the ads. The ad network also takes a (big) cut and pays the publishers for hosting the ads. The users whose data and attention are exploited rarely gets anything from this set up.

The encrypted immutability of blockchain technology also provides the added layer of protection for users whose data are mined in order to place targeted ads. The blockchain protocol of Kind Ads network ensures that no staff of the company or the company itself can access your data or exploit such your personal information for personal gain.

A cursory look at the current state of the global ads market suggests that nobody might be able to challenge Google and Facebook’s dominance in the industry. In fact, the market capitalization of Google alone dwarfs the market dap of the entire cryptocurrency industry. Google has a market cap of about $751.96B while the market cap of the entire cryptocurrency industry is $374.18B; hence, Kind Ads doesn’t seem to have the resources to go head to head against its established rivals.

The platform will aim to serve user-friendly ads that doesn’t interfere with the user experience could be a better way to change the paradigm shift of the ads industry. Kind Ads is coming to the market by focusing on push notifications and email marketing – these are ad mediums that Google and Facebook have largely ignored. Kind Ads will eventually offer native ads to compete with Google and Facebook, but it would only make that jump after it has won the hearts of users with its non-intrusive ads.

In simple terms, Kind Ads thinks we should let the customer be the judge on the kind of ads they want to see and the ad network they trust with their data and their attention.

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