The massive share of $550 bln advertisement market belongs to search engines and social networks accumulating private data, but the founders of a new startup BitClave believe they can change the situation.
A Blockchain startup BitClave based in Mountain View, California is aiming to reduce the cost of online advertisement by eliminating the middlemen. “Too much money goes to the hidden ad network with too little added value for business and customers,” the company said in the white paper.
The idea behind the startup is to give control back to the users, who could profit from every search result in which they meet the customer profile. Users would be able to control their identity, decide who has access to their data, and get “paid” each time businesses “use” their data to make offers.
BitClave promises to store data securely with the help of Blockchain and cryptography. The startup’s founder Alex Bessonov, a former Chief Security Officer of LG Electronics, said the platform is trying to bring peace of mind to Internet users by protecting them from hackers. BitClave will allow people to only select organizations to access their data in one-off “smart contracts.”
Impressions, views and clicks
According to the “Princeton Web Transparency & Accountability Project,” 76 percent of websites contain hidden Google trackers, and 24 percent have hidden Facebook trackers. Thanks to all this private information they can offer much better targeting than the competition. As a result, they now make 63 percent of all digital advertising.
In the US, Google received around $35 bln for the digital ads in 2017, while Facebook captured more than ‘one in five’ US digital ad dollars with a total revenue of more than $17 bln. But, according to BitClave, businesses have little guarantee the traffic they generate on their promotions is genuine.
In fact, nearly 50 percent of all advertising traffic is generated by bots, essentially defeating the entire purpose of advertising. Sellers pay for “impressions, views, and clicks” resulting in extremely low conversion rates. Decentralized search is the next step in advertising, BitClave claims and could help people and businesses to engage in value creation.
BitClave is building a token-based ecosystem for marketing and retail. The startup’s innovative decentralized search technology will be market driven. This means “businesses can optimize marketing investment with real results, consumers are incentivized to participate, and anonymity and data privacy are in the hands of each individual party,” the startup founders explain in the white paper.
What’s the potential for growth?
Every participant in the BitClave’s distributed Blockchain-based system called the BitClave Active Search Ecosystem (BASE), will receive Consumer Activity Tokens (CAT). The tokens will be used to reward participants for different services within the system.
Customers and retailers can interact directly through transparent and consumer-authorized message posts and data bundles on the public Blockchain. Additional parties can contribute as service providers by creating software capabilities, such as data analytics.
The BitClave’s alternative to search economy has a potential to become a retail marketplace. The startup creates opportunities for additional roles beyond buyer and seller. Any entity can participate in the system as an analytics provider.
This gives new opportunities to e-commerce, marketing or customer relationship. Any company who wants to know a particular feature of their customer base would be able to create a smart contract with an analytics provider.
While the ecosystem does not support contracting and bidding processes, any developer or organization could create new activity types and mechanisms for ‘bidding and negotiation’ so the participants could place their offers.
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