Most marketers by now have heard the word "blockchain," but some still cannot describe the technology or know what it does. So Data & Programmatic Insider caught up with Charles
Manning, CEO of Kochava, to walk through the details.
Although Kochava is a mobile measurement company, Manning's latest venture begins with measurement through the
blockchain XCHNG.
"Blockchain, much like the internet in the late to mid-1990s, isn't a cure-all for which you can apply pixie dust over a client-server system and have
things magically happen," Manning said. "There are a bunch of components and parts."
Someone who doesn't know much about coding can use Wix to build a website. Those wanting to set up
smart contract on a blockchain to transfer money can use Ethereum to accept Bitcoin.
Online advertising is digitally rendered, making blockchain a prime candidate to support the
industry.
The automated blockchain has four distinct parts. There's the distributed ledger or network with synchronized nodes; the decentralized ad networks or data from which
content gets pulled; proof of work that allows the decentralization model to work smoothly; and smart contracts to ensure advertisements are served.
The insertion order for the ad buy
becomes the smart contract. And it's open-sourced, so anyone could use it.
"Blockchain is about unifying incentives to align," he said, explaining how cryptocurrency works. "You're creating
incentives for people to set up machines to ensure you have decentralization."
Manning likened Fast Track and a vending machine to a smart contract. "There's no intermediator," he said. "I put
in money, push a button and product comes out. I'm aware of the contract when I approach the machine and I get what I want out of it. No one is there to ensure it's done."
If there is no
central database, if everything is decentralized, there must be systems and codes in place that synchronize the network, provide incentives to alight, and ensure consistency along the ad supply
chain.
In Manning's description, remembering that unification is paramount to understanding how a blockchain works. All advertisements must run on one pipeline that allows them to travel on
the same track with a way to confirm the ad got placed and served in the correct location.