Blockchain provides the basis for a dynamic shared ledger that can reduce time when recording transactions, intermediary costs, and fraud. In the last couple of years, I’ve seen an increasing number of presentations on the value of blockchain. In industries where digital record-keeping is lacking, an immutable ledger (guaranteeing the chain of custody between parties) can be an enormously powerful tool.
Now it is much more than a concept – blockchain is being implemented around the globe. As the development of the “physical cloud” evolves, blockchain will thrive as more processes are truly automated, presenting fewer vulnerabilities and opportunities for fraud. Supply chains will have less buffer inventory, and more materials will be harvested just-in-time to feed fluctuating demand.
Yet in the marketing research industry, blockchain faces significant challenges. Current efforts, like those in other industries, are primarily focused on accounting benefits and fraud prevention. In particular, online consumer panel companies are dealing with huge amounts of fraud: they have been paying out millions in incentives for surveys with no data! How does this happen? Bots, click farms, and illegal software can all circumvent legitimate data collection efforts. One of the worst is a program called Coby. Once installed, it hides behind a VPN. Coby brags that it can generate personal information “to protect your privacy”, can complete Captcha prompts, completes surveys that have just enough variability, and generates email to fool panel companies. No wonder research companies are panicked.
Data privacy advocates say that blockchain will allow consumers to take control of their personal data “assets” such demographics or financial data. Online consumer panelists allow access to their anonymized personal information using tokens, which are digital permission slips with a limited lifespan. One a token is exchanged, the anonymized information (including survey responses) is passed to the survey research company. Then the token expires and the transaction is immutable. From a data privacy standpoint, these are positive developments.
Conversely, while blockchain is good for fattening research company profits, it does nothing to address the biggest issue in the marketing research industry: survey participation and non-response bias. Non-response needs significantly more attention, and is a major omission in blockchain discussions. One could argue (and I would agree) that putting the individual in charge of their own information is essential (and is at the heart of GDPR). In doing so, we may reduce the number of inappropriate requests for survey participation. Perhaps this will increase the likelihood that individuals will participate in the future.
For the short term, blockchain may solve part of the data quality problem. Can blockchain restore trust, and foster greater cooperation? Time will tell – and it will take a lot of time.