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A Brief Introduction to Kaleido

What is Kaleido?

Kaleido is a protocol that automates traditional ad transactions using smart contracts. Media ad space is treated as NFT.

Can there be a future where ad space is traded as NFTs with smart contracts?

My main job is working for an advertising agency. I always think ad space transactions are often useless, and I'm hoping that smart contracts will support Digital Transformation, so I'm thinking about ad delivery using smart contracts.
For example, if you're thinking of placing an ad on a 4-sided digital signage ad in Tokyo, you can't place an ad unless you know the business that manages the ad space or asks an ad agency. The act of placing an ad in an ad space is a "right," so if you are listed as an NFT, and your ad is confirmed and billed by smart contracts, your cash flow will improve dramatically, and anyone can participate, making ad space trading more convenient.
The reality is not that simple, but if the rights to be published in the media and news sites are NFTed, a deal to buy them and introduce them to the public could be realized.
The explanation may be a little redundant, but please bear with me.
 

Traditional ad space transactions

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The following is the flow of transactions that have taken place between advertising agencies and media companies so far. The following is a specific flow, but the details are not important, so please assume that there are many steps involved. ※The client is the advertiser.
■The actual flow
  1. The media company prepares an ad space that can be used to place an ad on its media. The company then sells the space to an advertising agency.
  1. The media representative of the advertising agency that provided the ad space will create a list of ad spaces for internal use.
  1. The person in charge of the media explains the advertising space to the sales team, and the sales team proposes it to the client as a plan.
  1. The client receives the proposal, judges whether the plan is good or bad, and decides to place the ad if satisfied.
  1. Decide on the content of the ad placement and produce the ad creative.
  1. The ad creative is delivered to the agency and the ad placement is completed.
  1. The advertising agency confirms the placement of the advertisement and invoices the client for the amount equivalent to the amount of the placement.
  1. The transaction is completed with the transfer of the advertising fee from the client.
 

The ideal ad space transaction

In this diagram, as an example,
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As the flow itself is not important, some changes will be possible from the traditional advertising model.
■Changes from Traditional models
  • The black box of ad space information will become open and available for anyone to purchase.
  • Ad spaces used to be sold at a fixed price, but since the price changes according to supply and demand, revenue opportunities increase.
  • Since ad spaces are NFT, they can be distributed secondarily.
  • Personal Twitter fixed tweets and email newsletters, which were previously difficult to use as media, can now be used as ad spaces.
  • Cash flow will be improved because of smart contract settlement.
 
■The ideal flow
  1. media companies list ad spaces as NFTs on the ad space marketplace (=Non-Fungible Ad Token)
  1. NFTs are automatically listed on the marketplace and made available for anyone to view.
  1. Clients can directly browse the marketplace and search for their desired ad space.
  1. when they find an ad space that meets their needs, they purchase the space (dynamic pricing)
  1. After the purchase, the marketplace asks the client to submit the creative.
  1. During the period indicated in the ad space NFT, the submitted creative will be automatically submitted
  1. After the ad placement period is over, the NFT fee will be billed and paid via smart contract.
  1. After the payment is completed, the whole process is finished.
As I wrote about the ideal ad space deal, if this could be realized, the work of ad agencies would decrease considerably. To be a little more precise, the job of an advertising agency will become a job that anyone can do.
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For example, there is a position in an advertising agency called media planner, which is responsible for planning which media should be used to fulfill the advertiser's wishes. This position uses media data for planning, so if you stop working at an ad agency, you can't stop because you won't see the data anymore.
If this system can be realized, the information of the frame will be open, so individuals will be able to do media planning. I haven't seen many examples of smart contracts for advertising, but a project born from a hackathon called microsponsors has realized about half of this process.
notion image
I think it would be difficult to immediately introduce this system to the current media because there would be many conflicts, but I thought about what the future ad serving system would be like. I've been thinking about this. I think there may be a future where full-on-chain ad frameworks, NFTs, become popular in the future.
What do you think after reading this? I'm looking forward to your opinions and comments.