Why the Basic Attention Token (BAT) is the answer to digital advertisers biggest problems.

If you have been following the recent bout of ICO’s you have likely heard of the Basic Attention Token (BAT). If you have been following BAT with Google alerts or something similar, you have also likely heard that they raised 35 million in 30 seconds. In fact you have probably heard this every other day and it seems to be the only thing mentioned about it.

This is a real shame, because if the focus was on WHY it sold out that quick the information would be more useful. Every successful technology solves a real world problem, and the online ad industry definitely has a real problem.

The underlying benefit of so many blockchain technologies is that they cut out the middleman and provide transparency. Online advertising, as anyone who works in it knows, has A LOT of middlemen¹.

Between the advertiser and the publisher (who makes the content you want to read) there is an entire industry referred to as “Adtech” that is designed, in theory, to help advertisers find their audience. However, the entire industry is incentivized to inflate audience numbers. The payment models often used are CPM (cost per mille) which means for every 1000 views an ad receives a certain amount is paid, or CPC (Cost per click). The average CPM for the sort of ads you will see in your browser is about $2.80². Since the audience number is used to drive the pricing model fraud is rampant. So much so that the worlds biggest advertiser P&G has even described the whole thing as “murky at best, and fraudulent at worst”³. Not exactly a resounding endorsement.

With a blockchain based approach, both the advertiser and publisher are able to see the payment go across the entire purchase journey. With a full implementation of BAT, it is no longer possible for behind the scenes deals to eat into publisher profits. Basically, a publisher wants to use BAT because they can get a bigger cut of the advertising budget for their content, the Advertiser wants to use BAT because they can avoid a large part of the unnecessary tech tax and get a better price, even while the publisher makes more. This transparency is desperately needed and is reason alone for BAT to succeed, but as with every great story, there’s more.

The other party involved in this whole process is of course you. The reader. With Ad-blocking and anti-tracking software freely available, readers do not have to “be the product” if they do not want to be. As much as the publisher may be interested in what they are writing about, the financial incentive to publish is never too far from mind, by the very nature of this article being on Steemit we can all agree to this :) BAT hopes to find a sensible middle ground by allowing the advertiser to understand the audience they are reaching without giving them free access to all of the users data. With BAT, the user has the ability to both be rewarded for participating in the advertising transaction and reward sites that they frequent often. Of course, there will be some users who simply leach, but as with other things (think, private torrent tracker), the community will devise a way to highlight that choice.

So will BAT change the online advertising world, only time will tell, but it solves some of the biggest problems it has, and as with all successful technologies, when a real world problem gets solved, the tech takes off in a big way.

Disclosure: I hold a meager amount of BAT (~3000).
Disclaimer: This is not investment advice.

^{1.http://www.lumapartners.com
2.https://monetizepros.com/display-advertising/average-cpm-rates/
3.https://www.marketingweek.com/2017/01/30/pg-media-buying/
Photo by Aidan Bartos on Unsplash}