Podcast Notes | Interview with Spindle Founder: The Feasibility of Decentralized Advertising and Marketing
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Podcast Notes | Interview with Spindle Founder: The Feasibility of Decentralized Advertising and Marketing
The main challenge of advertising is linking the user's initial interaction with an ad to their eventual purchase or conversion behavior.
Navigating Web3 tides with focused insightsCompiled & Translated: TechFlow
In the latest episode of the Empire podcast, Antonio García Martínez—founder of Spindle, bestselling author of The New York Times, and a tech executive with experience ranging from Facebook to Goldman Sachs—delved into the intricate world of advertising. He contrasted traditional Web2 paradigms with emerging Web3 possibilities, revealing insights on the decentralization of ad platforms, evolving monetization models, and the ethical implications surrounding data privacy.
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Below are the key takeaways from the conversation, transcribed and compiled by TechFlow:
Host: Jason, Empire Podcast
Guest: Antonio García Martínez, Founder of Spindle
Video Source: Empire Podcast
Episode: Link
Original Title: "Web3 Ad Markets Explained | Antonio García Martínez"
Date: August 29
Weaknesses of Web2 Advertising: Multi-Touch Attribution
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Antonio first discussed the concept of "multi-touch attribution" (MTA), an advertising term describing how credit is assigned across multiple ads or marketing touchpoints a user encounters before making a purchase or conversion.
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He illustrated this with an example: if a user first learns about a product via a podcast, then uses Google search for more information but doesn’t buy immediately, and later sees a Twitter ad and decides to purchase—the three touchpoints (podcast, Google search, Twitter ad) all contributed to the final conversion. Therefore, all three should receive attribution, rather than giving full credit solely to the last touchpoint (the Twitter ad).
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Antonio pointed out that under the Web2 paradigm, achieving such attribution is extremely difficult. Technical and data limitations in Web2 make it complex to accurately track users' behaviors across multiple touchpoints. If a user operates across different devices or browsers, tracing their complete purchase journey becomes even harder.
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Jason mentioned two recently popular themes in the crypto space: friendtech and social tokens. With the rise of these narratives, questions around Web3 social business models have emerged. Unlike traditional Web2 social platforms like Facebook or Twitter, Web3 social models are more decentralized and may involve token-based incentive mechanisms.
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Antonio explained that at its core, advertising—whether traditional or future Web3 in-game ads—is about user exposure to ads. The primary challenge lies in linking a user’s initial contact with an ad to their eventual purchase or conversion behavior—this is known as the attribution problem.
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Facebook not only needed to build targeting capabilities but also systems to measure ad effectiveness. For instance, back in 2011, if you clicked on a Facebook ad, Facebook had no way of knowing what you did afterward on other websites or whether the ad was effective.
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Antonio noted that Web2 took about 10 years to develop real attribution and measurement systems, and he hopes Web3 won't take nearly as long.
TechFlow Note: True measurement means that if a company spent $30,000 on Facebook ads last month, they want to know exactly how much revenue it generated.
Strengths of Web3 Advertising: The Attribution Database
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Jason shared an interesting story: when their clients spent heavily on ad campaigns, they often had no clear idea of the results, relying instead on informal feedback to assess performance.
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Antonio explained that advertising has two main components: targeting and attribution. On the targeting side, advertisers want to know how many users they can reach on platforms like Facebook—a match rate that was very high during early product launches. Then comes the measurement component: advertisers need to know whether their spending yields positive returns. To obtain this data, there needs to be a common identifier shared between advertisers and platforms. In Web3, this could be a wallet address; in Web2, it might be an email address.
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Antonio further illustrated that each Apple device (like an iPhone) has a unique “ID” called the IDFA, while Google’s Android devices have a similar identifier called the Android Advertising ID. These IDs function like personal identification numbers—unique identifiers allowing advertisers to know which specific device saw an ad.
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However, Apple recently made privacy changes that removed access to the IDFA. As a result, if advertisers want to serve ads on iPhones, they cannot precisely identify which specific iPhone received the ad, making it difficult to accurately track ad performance.
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Antonio emphasized the importance of advertising in Web2. Ad tech funded the Web2 internet, enabling many online services and content to remain free for users. However, poor-quality advertising creates a bad user experience—for example, overly frequent, irrelevant, or intrusive ads may drive users away from a site or app.
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Antonio believes Web3 offers new monetization pathways. He predicts that due to its decentralized nature and blockchain technology, Web3 advertising will allow for more personalized and targeted ads—making them more engaging and interesting, while also offering greater creative freedom.
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Antonio highlighted a significant advantage of Web3 over Web2 advertising markets: the existence of an attribution database—the blockchain. In Web2, ad attribution (tracking users from ad exposure to action) is a complex issue requiring multiple tools and technologies. In Web3, the blockchain provides a transparent, immutable record system, simplifying and streamlining attribution.
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Because the blockchain is a public, decentralized database, anyone can query its data—giving advertisers a powerful tool to accurately track ad performance and optimize based on real data.
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Antonio emphasized that in the Web3 world, when a user buys cryptocurrency or an NFT, that transaction is recorded on the blockchain. This gives advertisers a unique opportunity to identify which users are interested in certain products or services and target them accordingly.
Centralization Trends in Advertising Markets
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Jason discussed the complexity of ad tech, outlining the ecosystem involving advertisers, publishers, agencies, media buying desks, DSPs (Demand-Side Platforms), ad exchanges, and ad networks.
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He explained how ads pass through multiple platforms, noting that within the so-called "programmatic stack," an ad might go through five or six different platforms before reaching the user. Starting from the advertiser, the ad flows through various intermediaries—media buying platforms, DSPs, ad exchanges, ad networks—and finally reaches the publisher or user. Each step may involve selection, optimization, and pricing decisions.
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Antonio added that although the Web2 ad market has already become quite complex, with the rise of Web3, similar specialization trends are beginning to emerge. He believes the future ad market will be more decentralized, with ad delivery and optimization becoming more transparent and fair.
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Antonio introduced the concept of "vertical integration," where a single company controls multiple stages of its supply chain—from ad creation, selection, and optimization to final delivery and measurement—all managed internally.
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Large companies like Facebook, due to their scale, technical capabilities, and resources, can vertically integrate the entire ad ecosystem. This allows them to optimize ads more efficiently, deliver more targeted content, and measure performance more accurately. Smaller companies, constrained by limited resources and technology, struggle to achieve full vertical integration.
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Due to the dominant positions of giants like Facebook and Google in the ad market, the industry shows a trend toward centralization—allowing these large players to strengthen their control over the ad ecosystem, while smaller firms face increasing competitive pressure.
Current State of Advertising in the Crypto World
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Jason asked about the current state of advertising in the crypto market. Antonio responded that if this question were asked a year ago, the answer would likely have been “almost non-existent,” except for NFTs and token launches.
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Antonio described the complexity of tracking a user’s journey in Web3—from clicking an ad to executing a trade on a decentralized exchange (DEX). Due to blockchain’s anonymity and decentralized nature, traditional ad tracking methods no longer apply.
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In Web3, referral systems typically operate via smart contracts. When a user makes a transaction through a referral link, the smart contract automatically rewards the referrer. The advantage of this system is that it’s fully decentralized, requiring no intermediaries.
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Antonio pointed out that many existing referral systems have a flaw: when a user clicks a new referral link, the old referral ID may be overwritten, causing the original referrer to lose deserved rewards. He mentioned that Spindle’s referral system ensures referrers receive fair compensation, even if users later click on other referral links.
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Antonio also referenced CoinGecko, a well-known cryptocurrency price tracking website, which hosts numerous referral links pointing to various crypto exchanges or related services. When users register or trade through these links, CoinGecko earns commissions from partner platforms.
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Antonio emphasized that in the Web3 model, advertisers can pay for multiple touchpoints, not just the most recent interaction. If a user sees ads in multiple places and eventually makes a purchase, all those touchpoints may receive some form of reward. This multi-touch attribution model is difficult to implement in Web2 advertising markets.
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In Web2, advertisers typically only pay for the last touchpoint, considered the most critical factor leading to conversion. But in Web3, due to technological advances and decentralization, advertisers can fairly compensate multiple touchpoints.
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He continued discussing Web3 advertising models, noting that they enable payment across multiple touchpoints, not just the latest one. Such multi-touch attribution is impossible in Web2. In Web3 advertising, not only do advertisers and publishers earn revenue, but referrers, content creators, and other participants can also receive rewards based on user actions.
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Antonio highlighted a core feature of the Web3 experience: “wallet awareness.” That is, the Web3 user experience is built around crypto wallets—whether Coinbase Wallet, MetaMask, or any other—contrasting sharply with Web2, where experiences are usually based on user accounts or other authentication methods.
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Antonio noted that Web3 users typically have a much higher lifetime value (LTV) compared to Web2 users. Web3 users often deposit substantial funds on decentralized exchanges or other platforms and actively participate in various crypto projects and transactions.
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Antonio emphasized two key characteristics of the Web3 advertising market: high lifetime value (LTV) and relatively low daily active users (DAU). Despite lower DAU, the high LTV allows cost-per-thousand impressions (CPM) to remain healthy. This means that even though the number of daily active users may be small, their value to advertisers is exceptionally high.
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