The following is an excerpt from the new e-book, The CMO Primer For The Blockchain World: How This “Trust Machine” Impacts Branding, Customer Experience, Advertising and Much More by Jeremy Epstein, CEO of Never Stop Marketing.
It features forewords by the CMO of Nasdaq, Jeremy Skule and the CMO of Dun & Bradstreet, Rishi Dave. The e-book explores seven different marketing functions and how blockchains might impact them as well as highlighting a few emerging vendors in the blockchain marketing tech space.
To download the FREE e-book, please click here.
Data Becomes a Commodity, Insights and Questions are Assets
There is nothing you don’t already know that can be added here.
Where Blockchain Technology Can Fit In
If there is a “sweet spot” for blockchain, this is probably it.
The first and most obvious benefit is that blockchains will give you greater confidence in the integrity of the data you see. Immutable entries, consensus-driven timestamping, audit trails, and certainty about the origin of data (e.g. a sensor or a kiosk) are all areas where you will see improvement as blockchain technology becomes more mainstream.
Beyond data integrity (which is a huge component), the shared data layer that blockchains will introduce creates an entirely new set of possibilities for marketing AI capabilities and insights.
- More data thus improved modelling capabilities
- Qualitatively new data leading to entirely new models
The inherent immutability leads to provenance on training and testing data and the models they produce, all leading to greater confidence in the accuracy.
We are also likely to see blockchain-based technology make an impact in the cost of storing data and in the amount (and quality) of data available to you as a CMO. This data will help you create predictive models to identify new revenue opportunities.
Cost savings in data storage will come from the disintermediation of centralized storage providers, thus reducing the “trust tax,” you pay them currently. This should also create downward pricing pressure on your SaaS suppliers as they move to decentralized storage providers.
Near-Term Impacts and Benefits
You can expect to see decentralized solutions like Storj, Sia, MaidSafe, and FileCoin start to gain some initial traction in the enterprise storage space. Storj already has one enterprise customer in pilot phase and the estimates are that, so far, they will be able to reduce costs of storing data by 90% when compared to AWS. As a CMO with large enterprise data costs (either direct or indirect), this represents significant potential cost savings, which can be redeployed elsewhere.
Imagine reducing the cost of hosting the data for your entire website by 90%. As for blockchain-driven AI, you can expect to see a three phase roll-out. First, within the existing enterprise. Then, within the ecosystem. Finally, totally open systems. The entire industry might be termed blockchains for big data (Trent’s words).
This will certainly take some time to evolve, but you will see companies like BigChainDB and others like Chain.com, PeerNova and DisLedger, as they expand from the financial services world. Of course, large established enterprise players will jump into the fray. IBM has already announced a “Watson for Blockchain” solution and Google will use DeepMind and Microsoft’s blockchain team is getting stronger.
For an early preview of what one AI+blockchain solution looks like, you can look at Numeraire. It is an effort to create a collaborative hedge fund using common data sets. Members of the network compete to create the best algorithm for generating returns. They stake their efforts using Numeraire tokens and then share proportionally in rewards. The hypothesis of the firm is that removing the obstacles to access to the data and giving each of the network participants a monetary incentive aligned to overall performance of the network will yield improved results.
Long-Term Impacts and Benefits
We will see an expansion of the concept of “big bata,” as we move from proprietary data silos to blockchain-enabled shared data layers. In the first epoch of big data, power resided with those who owned the data. In the blockchain epoch of big data, power will reside with those who can access the most data (where public blockchains will ultimately defeat private blockchains) and who can gain the most insights most rapidly.
There are two significant implications.
- Customer data will not belong to organizations, locked away in corporate databases. It will belong to each individual, represented as tokens or coins on an identity blockchain. The customer of the future will grant access to others as necessary.
- Transaction data will be viewable by anyone. Anyone can access the data about the transactions that occur on a given blockchain. (For example, here are the latest Bitcoin transactions.)
When data moves out of proprietary systems onto open blockchains, having the data itself is no longer a competitive advantage. Interpreting the data becomes the advantage.
In a blockchain world, all competitors are looking at the same ledger (imagine you and your competitors all have the Google Sheet or Excel file). Anyone can provide an interface to that ledger. That’s relatively easy. That’s what you see here for Ethereum or zCash. Many companies will provide applications that enable a customer to interact with a protocol. This is what Jaxx or BitPay do, for Bitcoin.
Yet, there are very few companies that provide a set of analytic capabilities that suck up all of this data and explain what it all means or what should be done about it. Fewer still have figured out the scalable process for doing this. This is the opportunity. Some have called it the “Data Industrialization Opportunity.” Simply put, it is the question of who can put the best AI/machine learning solution on top of open, shared, blockchain-based data layers.
Whoever does that gains some degree of competitive advantage. If a Bitcoin wallet, for example, instead of being “dumb” (as it is now) is actually “smart” — in the sense that it can advise or help customers make sense of the world (based on all the data available on the blockchain) — that one will be market leader.
It will also lead to improved customer retention. Customer lock-in should never be “let’s make it really difficult for people to leave;” it is better imagined as “how can we mine, extract, and deliver insights and value from the shared data layer so that people don’t want to leave.”
The world’s top 50 physical mining companies are worth about $700 billion dollars. You can expect to see blockchain-based data mining companies that will easily take us into trillions of dollars of market capitalization (granted, this may be many years off).
As a CMO of the future, you will benefit from a cursory understanding of how AI works on top of blockchain-based data. According to the MIT Sloan Management Review in Romantic and Rational Approaches to Artificial Intelligence,
“Managers and executives may find that their understanding of the AI output improves slowly. As complex as analytical models can be, managers and executives likely have at least some basic statistics background to build from — so they have a starting point. But with artificial intelligence models, managers probably have less background. Machine learning is rarely part of a business curriculum core.”
Understanding the capabilities of AI and machine learning is important, as is how to interpret the data, but that is not the most important skill for the CMO of the future. The most important skill is knowing how to ask great questions.
Kevin Kelly, one of the most impressive thinkers on technology in the world, wrote a fantastic book called The Inevitable: Understanding the 12 Technological Forces That Will Shape Our Future. He makes many excellent points, but let’s focus on one in particular, the importance of questions:
“A good question is the seed of innovation in science, technology, art, politics, and business. A good question is a probe, a what-if scenario. A good question skirts on the edge of what is known and not known, neither silly nor obvious. A good question cannot be predicted. A good question will be the sign of an educated mind. A good question is one that generates many other good questions. A good question may be the last job a machine will learn to do. A good question is what humans are for.”
Machines may be able to give us the answers, but they don’t know which questions to ask. Work on your questioning skills.
In a blockchain world, data changes from an asset to a commodity. The larger the dataset, the better the AI, which is why open/public blockchains should dominate in the long run. It’s not who owns the data, it is who uses it better by asking the best questions.
- Begin exploring blockchain-based solutions to help stitch together various data silos within your enterprise and ecosystem, with the expectation of improving the size of your data set
- Get a basic understanding of AI and Machine Learning
- Practice asking better questions. Start with the “5 Whys” of Toyota