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December 5th - 2022. Digital marketing is a broad term that includes many different methods of promoting products and services online. The goal of digital marketing is to reach potential customers through online channels such as search engines, social media, email, etc.
One emerging digital marketing trend is “crypto-driven” or “blockchain-based” digital marketing. This new approach uses blockchain technology to create more effective and innovative marketing campaigns. In this way, crypto-driven marketing can be seen as an evolution from traditional digital marketing.
This article will discuss cryptocurrency and how crypto-driven marketing could help you promote your business.
What are Cryptocurrencies?
Cryptocurrency is a digital currency that uses cryptography to secure transactions and control access to a shared ledger. Bitcoin was the first successful implementation of this concept. However, other cryptocurrencies are available today, including Ethereum, Ripple, XRP, Solana, etc.
Cryptocurrency prices fluctuate based on market demand and supply. So when the demand for a certain coin increases, its price goes up.
Despite cryptocurrency price fluctuations, they have gained popularity over the past few years because they offer several advantages over traditional payment systems. For example:
- You don’t need to share sensitive information with merchants.
- It’s easy to transfer money across borders.
- Transactions take place almost instantly.
- No middlemen (such as banks or the government)
How Does Cryptocurrency Affect Digital Marketing?
The rise of cryptocurrency has paved the way for a new generation of businesses. These companies use blockchain technology in their operations, and they’re often referred to as “crypto-driven” or “blockchain-based.”
Here’s how cryptocurrency affects digital marketing:
Eliminates the platform that hosts advertisements
Digital advertisements usually involve four parties: the consumer, advertiser, content creators, and platforms hosting the advertisements. With blockchain advertising, advertisers will upload their ads to a blockchain, and the platform will host them. In short, the blockchain will become the intermediary between the advertiser and the consumer.
This eliminates the role of the platform hosting advertisements. Advertisers won’t pay them anymore; instead, they’ll utilize blockchain technology to distribute their ads to consumers directly. This means that the number of interacting parties involved in digital marketing is reduced to just three groups.
The use of crypto tokens
Another benefit of using cryptocurrency for digital marketing is the ability to incentivize your audience. Crypto tokens are a popular way to reward people who perform tasks online. For example, you could give away free coins in exchange for engaging with an ad. Or, you could give away some coins for signing up for your email list.
Tokenized communities with strong social capital help build brand loyalty. Those who participate in these communities feel more connected to the brand and are more likely to recommend products to others.
Utilizing blockchain technology for fraud detection
When it comes to fraud prevention, blockchain technology offers some unique benefits. It allows users to verify each transaction individually. Therefore, if someone tries to make fraudulent transactions, it would be very difficult.
Marketers can use blockchain technology to detect fraudulent activity when it comes to digital marketing. They can use the data gathered by the blockchain to eliminate fraudulent impressions and fake traffic. This helps identify and prevent click fraud and bot infiltration for better and more accurate reports.
Creates better and more specific leads
With the use of blockchain, marketers can create leads that are much more accurate than before. The data collected from the blockchain is extremely valuable for creating highly targeted leads.
When a user performs actions like downloading apps or visiting websites, the information about this action is recorded in the blockchain. Through this process, marketers can learn more about their customers and target them accordingly. There will be a better understanding of what makes a customer tick. This enables marketers to develop better strategies to convert leads into sales.
Crypto-Driven Digital Marketing: Pros and Cons
There are different ways to integrate cryptocurrency and blockchain technology in digital marketing. But before you decide which one to go with, here are some pros and cons of this method.
- Eliminates middlemen: No third party is required to mediate the relationship between the advertiser and consumer.
- Reduces costs: Blockchain has the potential to reduce costs since there’s no need to pay intermediaries.
- Faster processes: Eliminating the need for intermediaries speeds up the entire process. Direct transactions between businesses and consumers are possible.
- Requires technical knowledge: Since blockchain and cryptocurrency are still new concepts, many companies need to hire experts to implement this strategy.
- May only be suitable for some businesses: Some businesses may find it challenging to adopt this strategy because of its complexity.
- Ads must be more appealing: Marketers need to create more appealing ads to capture the attention of blockchain users.
The Bottom Line
Blockchain technology and cryptocurrency are changing how we interact with the internet. As a result, it’s becoming increasingly important for brands to understand how to leverage these emerging technologies. While it requires effort and time to fully grasp the concept, incorporating crypto-based solutions into existing digital marketing strategies can help your company gain a competitive edge.