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Why Market Research Will Be a Catalyst for Blockchain Mass Adoption

Oct 16, 2018 1:58:33 PM

Despite the extraordinary interest and activity around blockchain-based technologies, we are still a long way from a point of mass adoption. Bitcoin was, in some sense, the first killer application of blockchain. However, while most people have heard of bitcoin, only approximately eight percent of Americans hold any cryptocurrency. There are a few obvious reasons for this including regulation, skepticism, relative immaturity of the technology, and lack of obvious, easy-to-use consumer-based technologies such as digital wallets.

Outside of cryptocurrencies, another interesting area to look at is the use of distributed applications or DApps. According to dapp.review as noted by James Martin Duffy, co-founder at Loom Network, if you add up all the daily active users (DAU) for the top 100+ active DApps, we are looking at less than 10,000 users in total who are interacting with an Ethereum DApp. Most of these are either exchanges, games, or casino/gambling DApps. Ever heard of CryptoKitties?

We at Measure predict in the near term that most of us will be utilizing some kind of blockchain and cryptographic token whether we are aware of it or not.

There are typically two factors that drive any kind of behavior change leading to mass adoption. We can characterize these as social pressure (or FOMO), and economic. Barring any basic survival needs, these are the strongest forces driving individuals to change their behavior.

Most of today’s social platform success has been driven by social pressure or fear-of-missing-out (FOMO). Nobody needs or ever wanted Facebook or Instagram. These platforms are successful because our friends use them. Everyone knows that one friend who is still resisting and, as a result, is left out of “water cooler” discussions. Ask yourself, if your friends were no longer on Facebook, would you miss it?

The second motivator for behavior change, in this case, mass adoption, is an economic one. To date, most of the blockchain projects we’ve seen focused around monetizing an individual’s data are based on micropayments. While being a very valid approach, micropayments for ad exposure, for passive data contribution, or other require high volumes and long durations to amount to anything significant.

A micropayment approach works well within the digital advertising field for the buy and sell sides where many tens of thousands of transactions can be aggregated. For the individual, however, it is hard to achieve meaningful volume and the few cents or single digit dollars per month that this is worth is insufficient to overcome the effort required to participate.

Here lies the opportunity for market research. Market research is in a unique situation where individual transactions are worth dollars — a very different proposition than micropayments worth cents. Researchers regularly engage with consumers to provide feedback via surveys and, depending on a number of criteria, can be $1, $5, or even $20 or more.

Unfortunately, today, much of this value is allocated to research panels who are tasked with recruiting, managing, sampling, and incentivizing panelists to complete research tasks. They act as intermediaries between the researcher and consumer. For many large panels, in a typical transaction, a respondent may receive only about 41 cents out of $5 that was spent on them.

The market research industry is also grappling with issues around fraud, data quality, lack of transparency, and declining participation. At Measure, we believe that it’s possible to use a blockchain as the backbone of an automated system that can fundamentally change the rules of engagement and drive improved economics. What happens when instead of paying 41 cents we are able to pay participants $3, $4 or $12? Compounded with assurances around privacy, validation, transparency, and overall improvements in data quality we now have what is a potential game changer.

Paying individuals fairly for participation will lead to increased participation, good behavior, and higher retention. In terms of scale, many current sample providers have in excess of 6 million or more participants. If even a small percentage of research participants — along with new audiences attracted by the promise of data sovereignty, higher payments, the allure of cryptocurrency, and guarantees of privacy — engage within a blockchain-powered marketplace, there is a real opportunity that market research will be the first to onboard a million users onto a blockchain.

Original article published on Medium

Paul Neto
Written by Paul Neto

He is a technologist, entrepreneur and market researcher. He was the co-founder and head of research at Crowd Science. Most recently he was head of digital and media for Kantar Canada, the research arm of WPP.

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