Recently we had the pleasure of speaking with (the other) David Berkowitz, founder and CEO of Serial Marketer and longtime digital marketing guru. In his over 500 articles written for major publications like AdAge and VentureBeat, countless talks at marketing and technology events around the world, and senior positions held at agencies like 360i and MRY, David has nurtured a reputation as a outspoken thought leader with his expertise, wit, and candor.

We talk to him about blockchain, programmatic advertising, and whether or not postcards are a viable identity management strategy in 2018. David is a Lucidity advisor. 

Q: Do what so many others have failed to do. Give us a simple definition of blockchain technology.

It’s a decentralized ledger that does peer-to-peer ledgering for verifying authenticity.

Did I say “ledger” yet?

The Oxford English Dictionary – which comes from a place where elected officials actually need to be able to string sentences together – uses this as an example: “We can actually have a look at the blockchain and see evidence of what’s going on.”

You can replace “blockchain” with a lot of words here:

  • microscope
  • spreadsheet
  • screen
  • research
  • textbook
  • or Netflix series

That’s why “blockchain” is moving into the territory of phrases like “augmented reality” and “fake news.”

These phrases are totally meaningless unless you’re discussing a specific application of what it does, and even that application may not be a good example of it.

For instance, a lot of definitions of “blockchains” use terms like “public ledger,” but then various people or companies will reference a private blockchain, and you can throw the old definition out the window.

Blockchains do tend to share some characteristics, including that the data written to them can’t be altered, and that the data must be verified by a number of different sources before it is confirmed to be true.

Q: What parallels do you see between blockchain today and the Internet in the early 90s?

Blockchain is connective tissue, a framework. It’s not totally unlike that not-so-terrible “information superhighway” concept.

“Bitcoin may have uses, but it’s far from the killer blockchain app. We’re still trying to figure out what those killer apps are.”

Blockchain is like an extra high-occupancy-vehicle (HOV) lane added to the highway, still largely under construction, where all the rest stops are talking to each other and going, “Hey, Skippy, is that red ‘94 Tercel supposed to be there?” And all the other rest stops are frantically confirming or denying it.

And those rest stops are really varied. Some serve gas. Some serve food. Some have really good doughnuts, and you’re like, “Wow, what are the best doughnuts ever doing at this random rest stop?” And others smell of stale cigarette smoke with restrooms reeking of too many different kinds of bodily fluids, so it makes you want to get moving as quickly as possible.

Anyway, there’s a lot of energy in the blockchain space. There’s a lot of smart money, and a lot more stupid money, all from people who had made that money off a mix of smart and stupid Internet ideas.

For the Internet though, you had about 25 years between the first messages being transmitted on it and the first Web browser to make it user-friendly. In between, you had Steve Jobs and Bill Gates and so many others coming up with the hardware and software underpinnings.

By the time anyone was investing in dot-com startups, there were already killer apps like email. There were interoperability standards.

While blockchain was an idea dating back to the early 90s, it didn’t have any embodiment until Bitcoin’s debut in 2008 and official release in 2009.

Bitcoin may have uses, but it’s far from the killer blockchain app. We’re still trying to figure out what those killer apps are.

Q: Do you think blockchain is headed towards the same large-scale adoption as the Internet? Why or why not?

Blockchain will always be a subset of the Internet. Blockchain can’t exist without the Internet. The Internet can exist without blockchain.

“My other favorite real-world blockchain application? Pissing off ad execs.”

But yes, there’s probably enough value coming from the protocols that make blockchain work that blockchain will be part of people’s daily lives. For a few people, it will be very explicit – like they’re using blockchain to ensure both sides adhere to the terms in a contract.

But for most, it’ll be behind the scenes. You know how on TV, that superimposed first-down marker is really an application of augmented reality, but no one calls it augmented reality? That’s what blockchain will be for most people and most use cases.

Q: What are some of your favorite real-world applications of blockchain in use today?

I like a lot of the smart contract applications. You can use them to verify that something happened the way it should.

For example, you can confirm that the infant formula that you bought really came from the processing plant on the label and only includes the ingredients listed; a car that really was owned by these people and passed this series of inspections; an ad was really bought by this advertiser and ran on this publisher and was seen by human beings who meet these characteristics.

My other favorite real-world blockchain application? Pissing off ad execs. Business Insider wrote, “Ad industry execs are getting into screaming matches over whether blockchain will actually have any effect on the industry.”

Given how many people wish they could scream at ad industry execs, anything that makes such execs take their anger out on each other must be some kind of force for good.

Q: What are some laughably bad applications of blockchain?

I’m a fan of brands that can make fun of themselves, and the whole blockchain field.

KFC, for instance, pegged a bucket of fried chicken to the price of Bitcoin for a week. They’re getting some bad ideas out of their system so others don’t have to do it for real.

The actual worst idea relating to any major or once-major brand is KodakCOIN.

Kodak founder George Eastman, who shot himself in the heart after suffering from a spinal disorder, must be quite busy calling everyone he knows in hell to see if there’s a special place that can be reserved for those who tarnished his legacy this way.

Q: How would you describe the current state of programmatic advertising?

Unnecessarily complex.

I’ve been reading up on Byron Sharp, the author of the “How Brands Grow” books, among others, and he makes it all seem so simple. Marketers need to increase mental availability so people know about their offerings, and then increase physical availability so that such offerings are easy to buy.

Why is it that complicated to buy media, see what works, and do more of that?

What we need is the proverbial Staples-esque “easy” button for online advertising. There are now self-driving cars that can credibly pick you up at the touch of a button and drive you practically anywhere that roads can take you as soon as you tell it the address. Driving is a ridiculously complex activity that literally becomes a matter of life and death.

But no, let’s set things up so that you need PhDs in engineering and statistics just to be sure that your 10-second video about people consuming artificially colored and sweetened water is seen by a real human for more than a split-second.

Does this make any sense whatsoever?

Q: So blockchain in programmatic advertising. What’s your take?

Sure, let’s do it.

Q: Who bears the burden of enforcing transparency in digital advertising?

The one ultimately paying for it – the advertiser – needs to bear responsibility for it.

That means two things:

  1. Enforcing that partners uphold standards, such as minimizing fraud and ensuring that ads meet predetermined thresholds of viewability, placement quality, and other standards.
  2. That also means accepting the cost – training agencies and partners, investing in auditing technologies and services, spending more for real ads served to real people who might really be in the target audience.

Vendors must do everything possible to be above-board and not knowingly deceive buyers. Agencies need to do more to educate clients and their internal teams.

But if the clients are demanding the maximum reach for the minimum spend, they will get what they pay for, and they will set up all their partners for failure.

Q: Can blockchain help with any of these problems?

God, I hope so.

It seems like we’ve tried just about everything else, right? Or maybe we scrap all that and go with Facebook’s idea: sending everyone postcards to verify identities.

Facebook, which is sitting on north of $40 billion in cash and amassed a pretty good chunk of the world’s best engineers, is resorting to postcards. Read that as if there are a few expletives in there. It’s as if when we went to capture Bin Laden, the top brass said, “We have all the resources of the finest military in the world, but we’re going to go in there with muskets, flashlights, and a catapult.”

Q: Predictions for the future: what does digital advertising look like in 5 years?

All of it has gone in-house. And then all of it is spent on Amazon because Amazon has in turn acquired every significant company in every single vertical, so all of these Amazon brands just spend money there.

That put Facebook and Google out of business, as well as every ad agency and ad-tech company. There is still a duopoly because Amazon is in turn reliant on one other company: the US Postal Service, as postcards are the other driving force of the ad industry.

Amazon has tried numerous times to purchase it, but then gave up because negotiating with President Avenatti proved to be such a tiring pain-in-the-ass that Jeff Bezos said he could keep the damn USPS. If the President does in fact stick with his promise to only serve one term, then Bezos will try his luck with the groomed successor, the current Vice President Winfrey.