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Tackling Fraud and Waste with Blockchain


Tackling Fraud and Waste with Blockchain

Nadim Karam, Senior Director – Planning at Hearts & Science, explains how blockchain brings scalable trust to the digital marketing industry.

It is no secret that the digital marketing ecosystem is riddled with complexities and inefficiencies. In fact, fraud and waste within digital marketing have been doubling every two years on average, and there are no signs of it slowing down.

This is because today, the digital supply chain is based on non-transparent walled gardens. On average, there are 23 different participants involved in getting an ad from the advertiser to a consumer, and then back to the advertiser. And each point where data flows among these 23 participants is a point where unnecessary margins, errors or fraud chip away at that marketing dollar and make it difficult – if not impossible – to accurately measure an ad’s impact.

To make matters worse, there is no unified standard of measurement. Each of these 23 participants is likely to measure differently or employ different auction mechanics. For example, an ad server might count an impression according to one set of criteria entirely different from a DSP, an SSP or an ad exchange.

No mechanism exists for these unconnected parties to communicate with each other effectively. So, in our post-campaign reports, the industry accepts a 10% to 15% discrepancy between sources.

This environment has led to a lack of auditability and accountability, allowing for all kinds of fraud and waste to go unchecked, despite using the most advanced verification tools.

Ultimately, this is not only damaging advertiser ROI, but also leading to the growing lack of trust within our industry where even the most effective players can no longer prove their value.

The promise of blockchain

Blockchain is a list of records called blocks that are often public, transparent and permanent. New data (or blocks) is added to the blockchain only if it abides by a set of standards that is agreed upon by all participants, and no one can alter these transaction details once it is done.

The essential promise of blockchain is to guarantee that “You see what I see.” It creates a shared reality across entities that do not know or trust each other. Such a transparent and shared ledger can save billions of dollars from waste or fraud, and can help companies make more informed decisions.

Through a blockchain, all participants share a single and unified view of how advertisements are bought and delivered, providing end-to-end transparency across the supply chain. With this in place, no verification or reconciliation is needed since the blockchain provides complete visibility on where every media dollar is being spent.

It allows us to move away from closed and fragmented silos to an open and transparent ecosystem, where impressions are tracked based on a shared consensus of its participants, making them more reliable and authentic. Records are stored in a tamper-proof manner, creating a single source of truth where the data is auditable and time-stamped.

Furthermore, cryptography helps secure these verified records and allows users with permission to see only the parts of the ledger that are relevant to them, while keeping sensitive data secure and confidential. Essentially, blockchain’s value lies in its power to automate and scale trust – something that our industry is in desperate need of.

Benefits of blockchain

Many believe that it is just a matter of time before blockchain technology becomes an integral part of the digital marketing ecosystem. Why? Because this technology stands to benefit all the major players within the ecosystem.

Ad buyers:

  • Advertisers and agencies can finally get accountability and proof that the services they are paying for are being delivered.
  • They get the ability to deterministically mine current metrics for insights that improve future campaigns.
  • They can reduce waste and fraud, which ultimately improves the ROI of their marketing dollars.


  • Publishers receive a more cost-effective way to monetize their content and maximize their yield.
  • They are able to accurately measure their inventory’s impact and adjust campaigns to meet the evolving needs of the marketplace.
  • They get the ability to automate the expensive, manual, and time-consuming effort of managing and selling digital space. Furthermore, payments of verified impressions can take place nearly instantly through the blockchain, at almost no cost.


  • Consumers can keep their data secure as it travels through the digital landscape, deciding who can use it, when, and how.
  • They can also monetize their attention. Through the blockchain, they would be able to directly receive rewards or incentives for engaging with brands and their advertisements.
  • Their experience is improved, thanks to relevant and non-intrusive ads.

Blockchain is a potential game-changer for an industry in which the number of participants has grown enormously and where fraud, waste, and inefficiency have emerged as top challenges. With increased confidence in the data flowing between all parties, trust among ad buyers, publishers and consumers would grow.

Blockchain technology solves an important challenge that our society and industry are facing: scalable trust – the ability to securely transact with others who you may not know or trust.

Although it is difficult to predict exactly how blockchain will integrate into the digital marketing ecosystem, I look forward to a world where advertisers pay their fair share, publishers are rewarded for great content, and consumers are compensated for their most valuable asset – their data.

Opinions expressed in this piece belong to the author.

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