The Ad Tech Industry’s Data Transparency Problem
partnership, IBM and Unilever aim to help address a deep-seated and well-known
issue within the ad tech industry.
of the problem is the lack of transparency within
The programmatic advertising platforms that connect advertisers (with ads to
run) to publishers (whose websites visitors might want to see those ads on)
operate behind tightly closed doors. They collect vast amounts of data
about users, usually
without their consent or even knowledge. They use that data to make decisions
about where to serve specific ads, but the advertisers who pay them typically
have no way of knowing where, when or exactly why a particular ad was served to
a particular user. It’s all a secret.
secrecy gives rise to widespread fraud, among other problems, within the digital advertising
industry. Efforts to control the risk of fraud and other challenges have
swelled the ranks of middlemen within the ad tech ecosystem. The middlemen
consume an outsized portion of revenue, with as much as 70 percent of the money advertisers spend
to place ads ending up in the pockets of these middlemen. That loss comes at
the expense of content publishers, who would otherwise enjoy higher revenue for
the ads that they let advertisers publish on their sites.
IBM and Unilever Partner to Disrupt Ad Tech
this month, Unilever announced a partnership with IBM iX, a business
consultancy service run by IBM, to design a solution to the ad tech industry’s
data transparency woes and the problems that arise from them.
the companies have revealed little about the technical specifics of the new
platform, its core feature is that it is based on a blockchain.
blockchain [technology], you’ll be able to see everyone in the process and
exactly the function they perform,” Babs Rangaiah, executive partner for global
marketing at IBM iX, told Fast Company in reference to the platform.
testing, the blockchain-based ad tech solution has helped to identify
discrepancies within ad placement data, the companies said.
not the first time that IBM and Unilever have collaborated on a blockchain
technology project. Along with other companies, they partnered last summer to pursue a blockchain-based
solution for tracking contaminated food.
Newcomers to a Crowded Market
Unilever are by no means the first companies to recognize the data transparency
problem in ad tech or to envision that blockchains could be a solution.
Network and XCHNG have been working on similar solutions for some time. Both companies
are building platforms that use digital tokens and blockchain-based data
management to restore transparency to ad tech, while also aiming to provide
fairer revenue to stakeholders.
interviews, representatives of both of these startups said that they welcome
the new ad tech platform from IBM and Unilever, and expect it to complement the
solutions they are building.
thrilled to see major brands and agencies taking blockchain technology
seriously,” Adam Helfgott, CEO and founder of MAD Network, told Distributed.com.
“We are fans of Babs and the team at IBM and are excited to help as they start
to look at how blockchains can improve targeting and address consumer privacy.”
Network is also using blockchain technology to address the current challenges
facing ad tech, with solutions that allow consumer privacy and corporate
profitability to coexist, Helfgott said.
Walker, SVP of Blockchain at Kochava, the company behind XCHNG, said that XCHNG
“is in no way competitive to IBM’s blockchain technology, which is based on its
Hyperledger protocol and a general purpose platform for all industries. XCHNG
is a custom-built blockchain, not affiliated with an existing blockchain
protocol, that is custom-built from the ground up for the advertising
In fact, Walker
sees a partnership opportunity in the IBM and Unilever news.
which specializes in digital advertising measurement software, “could be an
invaluable media spend measurement partner to the IBM-Unilever venture,” he
said. “IBM’s analytics tools and blockchain technology are helping Unilever
tackle certain aspects of fraud by increasing the transparency of their supply
chain. Increasing transparency is a positive but, beyond that, you have to be
able to measure the customer’s journey in great detail.”
the blockchain space, too, advertising companies are pursuing new models of data sharing with the goal of restoring
transparency to the industry.
IBM and Unilever have not mentioned that a digital token will be part of their
blockchain-based advertising platform. That would be one differentiator between
their project and startups like MAD Network and XCHNG.
in the absence of more details about how the IBM-Unilever platform actually
works, it is hard to assess to what extent their solution will truly compete
with or complement existing solutions in this market.
clear, however, is that large enterprises are now taking a keen interest in ad
tech’s data transparency problem, and they see the blockchain as the solution.
Their thinking in this respect may not be entirely novel, but their ability to place
big names and big budgets behind blockchain-based ad tech solutions provides
further assurance that blockchain technology is poised to become an important
source of disruption in the digital advertising industry.
enterprises or startups will drive that innovation remains to be seen.