CNBC recently reported that blockchain technology – the very tech that brought us the decentralized cryptocurrency Bitcoin – is set to go mainstream. This change could fundamentally disrupt financial marketing as we know it.
Most people associate blockchain technology with Bitcoin, but there are several other cryptos making waves, Ethereum being one of them. Analysts say that we are still at least a year away from the blockchain revolution, but marketers should prepare themselves for industry-wide blockchain adoption.
Believe the Hype
As a financial marketer, you may scoff at the notion that blockchain tech will ever be accepted by our culture as a whole. But consider how marketers felt when the Internet first became a thing, or email, or social media.
You would be justified feeling skeptical about this technology, given how Google+, Vine, and Google Wave all made headlines, then quickly fizzled out. As marketers, overhyping is in our blood.
But unlike Google+, Vine, and Wave, blockchain technology – namely Bitcoin – is already being adopted by millions of people. And let’s be honest, we are long overdue for a decentralized currency, given all the threats to the current financial services sector, namely hacking.
For nine years, Bitcoin has been going strong, and steadily gaining speed. It’s never been hacked, and is recognized for its value. There has been some volatility, but major players are already putting the currency to good use, like IBM and Walmart.
Consider these other organizations planning to adopt blockchain.
- The DTCC is set to use blockchain to settle its derivatives trades to the tune of $11 trillion.
- Homeland Security plans to use blockchain to track goods and people across international borders.
- The FDA is looking at blockchain to help manage population health.
Another reason we need blockchain technology is because the pace of our lives demands it. It’s not as easy to send money or the title of a car or rights to a song as it is to send email, text, or a video file. All of this will change when blockchain goes mainstream.
But what does this mean for marketers?
Any Asset Can Now Become Digital
Right now brands control access identity and the gathering of personal information. With blockchain technologies, users will be able to use technology like Keybase to perform “cryptographically-secure” operations like chatting and file sharing while protecting their social identities.
Customers may choose to align with brands that offer censorship-resistant marketplaces, where users don’t have to divulge their identities to engage in transactions, while shunning traditional brands that don’t coincide with their core values.
Currently, brands are able to improve their value by retaining customer data. In the future, blockchain technologies may force brands to alter their approach. It will be more about how companies help customers use, interpret and interface with data that truly matters. For example, big banks and some governments are currently using blockchains as distributed ledgers that revolutionize the way information is stored and transactions are conducted. This gives users more speed, lower costs, higher security, and fewer errors. Blockchain also eliminates the central points of attack and failure.
We can expect blockchain tech to cause people to become skeptical to all claims without proof. For instance, Paul Armstrong, who wrote the book Disruptive Technologies: Understand, Evaluate, Respond, said that blockchain gives users “the opportunity to verify the identities of sellers or the authenticity of products, which could be huge for the luxury goods market and healthcare. You’ve got the potential to link back to the source for everything, so in food labeling you could use blockchain to scan a barcode that identifies a fish was caught in safe waters, reassuring consumers why they’re paying a premium.This may cause the supply chain to become a key part of a brand’s value proposition, rather than merely the products or services themselves.
Customer Rewards and Deals
We may see customers trading loyalty points and coupons freely among one another thanks to services like ShapeShift. This also means that it will take more than loyalty points to lock customers into a relationship.
Social media platforms like Steem will allow users to earn attention and get rewarded for participation. This means that marketers will need to engage in meaningful ways if they hope to garner attention. It also means they won’t be able to buy the attention they want. Email may be impacted by this trend, as well.
If you hope to “future proof” your marketing campaigns and business, imagine that assets like land deeds, loans, and bonds, will soon become digital. This may require asset programmability where business details and legal rules are hard-coded into the assets themselves. We can expect this to affect budget tracking and management.
In addition, consider that customer transactional data will soon be shared among all competitors within any given industry. That’s because blockchain transactions are public, transparent, and cannot be altered. This is likely to affect analytics and forecasting.
You should even be prepared to pay for customer attention at every touchpoint. With cryptocurrencies able to be divvied up into the smallest of fractions, an insignificant transaction can identify you as a serious marketer while keeping spammers at bay. All of this will be conducted directly without third-party intermediaries like banks or PayPal, making the tracking of consumers difficult. That’s not even mentioning the impossibility of tracking your target base when they start using anonymous currencies like Monero and Zcash.
Right now, financial marketers seem to be focused on the marketing trends of today to remain competitive. However, and while we can only speculate as to what the true changes will be, with Microsoft and IBM already making massive moves into blockchain solutions, the time is now to consider how to prepare for the future of marketing in the coming age of blockchain technology.
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of Banking.com or NCR Corporation.
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