Can Adshares re-invent Ads?

I’m interested in advertising and new technology.
I have thought about blockchain and advertising for a while. My last conclusion was transparency was enough to disrupt advertising industry. Here’s my last though on it.

Adshare’s ICO

I found that one company called Adshare did ICO. ICO means they made their crypto currency public. This is similar to IPO but without regulation.

It looks Adshare’s mission is to disrupt the advertising industry.
I like it and I even want to support them.

I like the idea of disrupting the ad industry with new innovative technology. This must be great because even though internet economy may need ads, current advertising do have problems.

Problems of advertising industry

1. Too annoying
   Advertising is annoying. This may be acceptable because we want to use some services for free but ads is getting more and more annoying these days because company needs to increase revenue intrinsically.
2. Too creepy
   Facebook read all our posts and know all our likes. Google know our search history and conversation on Gmail. I understand advertising companies need to collect our data to provide better ads. But the activity is getting creepier and creepier.
3. Expensive because of complexity, inefficiency, and fraud
   Since there are many stakeholders, the industry is complicated. The complexity makes the price higher and small businesses may not be treated fairly.

So if someone make ads less annoying, less creepy, and cheaper for advertiser, I can say this is better advertising. But to make this change happen, the startups like Adshares need to satisfy all stakeholders.

Stakeholders

1. User
   User likes free services but they also don’t like too annoying ads. Startups need to provide equally or less annoying ads. User will find a way to avoid ads otherwise.
2. Advertiser
   Most advertisers want is just performance. They don’t care transparency much.
3. Media
   They need revenue of course. They also don’t care transparency much.
4. Ad network
   Intermediates also need money.

Yes. they all but user want to increase revenue. their goal is not having transparency but money.

So in order to disrupt advertising, startups need to provide better ROI to advertisers and increase medias revenue without making ads more annoying. Ad network companies also have to make money.

Let’s check Adshare’s papaer with the criteria

We can find potential advantages of blockchain based ad network on their paper. Let’s check them.

1. Elimination of middlemen
   I understand that. Blockchain could potentially reduce the number of middlemen. But I think we need middlemen and Adshares looks to be one of middlemen. Or if we could make advertising work without any middlemen, it can be interesting.
2. 90% reduction of the fees is feasible
   As far as I know 70%(It depends of course) of money is distributed to media. Even though blockchain reduce 90% of middlemen’s fee, the impact is not significant. And I have doubt that they can create real business by reducing 9-% of middlemen’s fee while they are a middleman.
3. No barriers to entry
   More than 60% of online advertising is owned by Google and Facebook. They have significant barriers. Other ad networks also has entrance barriers. This may be false.
4. Single currency
   Advertising is basically local business. Multinational companies are happy where they are now. This is not a big deal.
5. Ability to serve controversial segments
   This may be real killer! Gambling and adult service may want crypto advertising. But I’m not sure media can accept it.
6. Equality of access to data
   This is a ethically good thing but not significant economically because most small businesses don’t have any AI resources. But I love it.
7. Less fraud
   This has a potential. but most deep pocket advertisers want big chunk of outcomes. If this feature is not pluggable to existing advertising services, it may not be appealing.
8. Data available to academics to develop better algorithm
   This is technically same as #6.
9. Resistance of ad blockers
   I have no idea because ad blockers can adopt to anything.
10. Compatible with coalition for better ads.
    This may be a good idea but nothing to do with blockchain.

I want to support Adshares because I love what they’re trying to do.

But I think the advantages are not strong enough to disrupt ad industry because there are strong entry barriers and reducing middlemen’s fee and transparency is not strong enough.

I also think middleman claiming reducing middleman’s fee as a big advantage is odd because I don’t want to invest in companies which are trying to shrink the market. If they do, their business model should be different from middleman. Or they may expect making money only by speculation of their own currency.

I agree the complexity of ad industry is one of problem. But merely one of problems and not a big one.

We need creative ideas which potentially can increase conversions dramatically without making ads more annoying.

If some idea increase conversion 10x without making ads more annoying, we can reduce ads half and increase advertisers’ and medias’ revenue at a time.

It may be real unicorn…

By the way I may not understand Adshares’s business model completely so this is merely a thought for the idea that blockchain ad startup try to disrupt the industry with transparency and middleman’s fee reduction.

Thank you for reading.