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Blockchain: Online Marketing Extinction

Blockchain: Online Marketing Extinction

It was a grand dream, I myself was a firm believer. A level playing field where the small business can advertise, compete and carve out business away from the big boxes. Online marketing was supposed to be the great equalizer. But, as the way of the world goes, all unregulated markets consolidate upwards, into monopolies. The ascension of Google and Facebook into the “Standard Oil” of Internet has meant that the revolution is over and the status quo was all will ever be gunning for.

So, why do they win? It’s because of extinction. The term referenced comes from the world of physics, not Paleontology (the study of dinosaurs).

In physics, attenuation or, in some contexts, extinction is the gradual loss of flux intensity through a medium ~ (WikiPedia, April 24th 2018)

What caught my attention was the very concept of “medium” and the conventional wisdom accepting “gradual loss” through them when it comes to the various upper funnel metrics of online marketing: impressions, installs, clicks, etc.

3 Myths About Click Discrepancy, for Digital Strategists

As the old edict goes, in order to understand why something happens there are a few basic principles to use.

  1. What is the simplest explanation?
  2. Who stands to gain from the current situation?
  3. If a radical transformation were to happen, what could be done to stop it?

And so, when viewed through this prism it’s easy to understand that click (or other KPI discrepancy) is built into the business model of established operations. They either take advantage of the natural complexity of tracking systems and fortify against this in their terms and conditions. Or they pre-design them into their margin at the expense of their demand partners.

So, if that is the simplest explanation what are the ramifications? As the inefficiency is built into the model, the demand player that manages to overcome them is those large enough to negotiate the issues with their supply channels. They basically fix the technological medium’s intrinsic porousness with business terms or accept that not all cards are on the table as there is no auditing mechanism of the true numbers.

In this system, those who have already undergone digital transformation (mostly retail marketplaces, service providers – leadgen, apps) can work demand the terms they need. Those who did not transform die out and the smaller players are capped at niche volumes, feeding off scraps of glossed over niches the pack leaders rushed by. These, of course, include criminals and gray hat practitioners that operate at such high margins through pressure tactics, upsells, cross-sells and compliance violations, that this doesn’t affect them.

Total transparency is bad news for everyone who is on top in this system – the monopolies, criminals and kingmakers of the new order (google, facebook, amazon, etc.)

Why Digital Strategists Love BlockChain

By using a distributed ledger, BlockChain would allow for a complete reconciliation of the tracked metric between demand and supply parties. There would be no “extinction” the “medium” of marketing would not alter the fundamentals of data integrity. The monopoly would be reduced to total transparency about actual pricing rates and backroom deals would be out in the open. This would motivate smaller players to band together in a wholesome transition to wholesale buying as opposed to the current divide and conquer practices employed by the largest supply players.

Blockchain, to re-cap:

is an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way ~ (Marco Iansiti; Karim R. Lakhani, Harvard Business Review, 2017, Jan–Feb Issue.)

Digital Strategy for Blockchain, In Conclusion

We have all taken a beating in the hands of monopolies during our careers, sometime we ride the wave, sometime the wave pushes us under. The moment of transformation will begin when players large enough up the food chain will incorporate Blockchain to transform their own business. This will flush through the system elevating their advertisers, giving them higher ROI and capturing market share at the expense of the old guard. We can’t wait.

The Paradox of Tactics

The Paradox of Tactics

A two year writing hiatus is best broken by this note – “Tactics will make you soar, but will not keep you air-born.”

Trough-out my career, I have noted, is that tactical work can be contrasted from strategic one in the following way:

Imagine a wheelbarrow, one person inside it, another outside – ready to push it downhill. That push, the construction of the wheelbarrow, the decision to take the leap these will all get you down the hill and moving forward. However, strategy would actually be plotting the path as you hurtle downwards and realizing, mid way, you don’t have a steering wheel.

The truth of the matter is that if you’re not willing to push, there will be no movement. However, without a plan the movement will be short lived as you crash into a ditch.

Build It, Then Tear It Down

The way I have been working to reconcile both of these realizations as of late is via the use of standard operating procedures (SOPs). The purpose is to decide on a:

  1. Workflow – high level
  2. Document tasks, owners, allotted time
  3. Roll it up, simplify the workflow and tasks – editorial work
  4. Quantify (use a reporting system)
  5. Optimize

Once you have a SOP (established flow, clear task ownership and timelines) and a way to quantify the steps and bottlenecks (CRM, Task Management, etc.) you have mapped your tactical tasks.

These quantified tactical lists are now applied into the strategic plan to see if projections are on point or not and how far off we are to reaching the fulfillment of the strategic plan.

Are We There Yet?

After the SOPs are live and performance on them is quantified, it’s time to see what’s wrong. If numbers are off by 20% the path to iterate with the SOPs is clear.

Iterating is done by altering a SOP or product feature, while keeping a control (a/b testing) to see if we are moving forward. To do so, you must plan an experiment which validates or invalidates an assumption you have made, and so:

  1. Write assumption
  2. Define experiment (tweaked SOP, or feature)
  3. Measure results against baseline
  4. Rinse and repeat

If you do not see growth via this method keep in mind that there might is a product to market fit issue.

Listening To The Market

In order to understand your experiments fully, qualitative research must be used. Asking a customer who is experiencing the control or new experiment what they were expecting is useful. Using the “five whys” method, in which you ask “what  were you expecting to see here” once and with each ensuing question ask “why?” will reveal a lot about the value you drive to customers.

What Do I Use?

  1. Task Mapping – Trello.com
  2. SOP Creation – Process.st
  3. Strategic Plan – LeanMonitor.com
  4. Market insight – Intercom.io
  5. Interviews – UserTesting.com
AdWords as a Research Tool

AdWords as a Research Tool

So many companies have become allergic to using AdWords. The reason? With the ability to track exactly what ads and keywords one uses in their campaigns via tools like SEMRush maintaining an advantage over time is highly difficult. A winning approach is to use AdWords as a competitive intelligence research tool.

By the time one stops a campaign with adwords they would have accrrued a lot of useful data. On the content network, using conversion tracking, you will have found websites that generate sales. With the search network, you would have found keywords that provide revenues.

Because Google Adwords are a competitive marketplace, every time you bid on a placement or keyword you are limited. You are limited to the rules of the game that the AdWords supply and demand market creates. This market place merely replaces two other marketplaces that are significantly less competitive. Those are: search engine optimization and media buying.

By using AdWords as a research tool and not as a channel, one can fine out what keywords are worth hunting and what ad placements one should acquire with niche websites by going for a direct media buy.