IBM-Unilever blockchain pilot cuts wasteful ad spend

Michelle Peluso

Michelle Peluso

August 15, 2019 - Matt Marshall of VentureBeat writes: A year-long pilot that uses blockchain to improve online advertising efficiency has yielded promising initial results, according to IBM CMO Michelle Peluso [pictured].

The project has already reduced pennies on the dollar of waste in the area of ad reconciliation and brought greater transparency to the complex gauntlet of intermediaries brand advertisers have to deal with, Peluso told VentureBeat in an interview this week. And there’s more to come, she said.

Peluso’s remarks are the first time the company has commented publicly about results of the pilot.

Reconciliation refers to the process advertisers use to ensure contracted agreements are actually delivered. Peluso estimated the average savings at 2 to 3 percentage points, though the company is still collecting results from its multiple brand partners.

The problem

On the one hand, online ads are highly effective because they’re more personalized than other forms of advertising. The sector has exploded, and this year online ads will for the first time account for more than half of the total advertising market.

But that growth has been accompanied by significant problems.

Just 20 years ago, Peluso explains, about 85 cents of every dollar spent by an advertiser made it to the publisher. The reason it wasn’t 100% is because an advertiser would pay modest fees to a creative agency, and perhaps a media placement firm. Today, at most only 40 cents of every dollar is getting through to the publisher, Peluso says. (The Association of National Advertisers cites similar numbers.) More...