My journey into Web3 marketing officially began when I joined ConsenSys as chief marketing officer in 2016, where I built the first Web3 marketing team and helped bring Ethereum as well as the ConsenSys brand and many early Ethereum-based tools and applications to market. During my time at ConsenSys, our marketing team played a pivotal role in shaping the narrative around blockchain and crypto adoption globally, engaging enterprises, governments, developers and end users. I then founded Serotonin — a Web3 native marketing and product studio — to multiply the impact of the Web3 marketing best practices we had developed by expanding beyond the ConsenSys ecosystem.
I recently had the chance to be a part of Pandoraland’s Accelerator program as a mentor on Web3 marketing. My goal in speaking with the startups in the accelerator, as well as in writing my recently published book Web3 Marketing, is to share the lessons from eight years developing and honing a Web3-specific practice of marketing with those best-positioned to turn the lessons into value. Perhaps you, too, are one of those people: an entrepreneur, educator, builder, creator or community leader exploring what Web3 could unlock for your business, school, project or career. A book, or an expert talking about a book, ideally offers an efficiency, packaging up years of learnings from repeat experiences into an actionable form. Below is a taste of that efficiency in the form of a modified excerpt.
From Web3 native projects to enterprises entering the space, Web3 has permanently changed how marketing works. Here is a bit of what that means.
Marketing in a Web3 world
Web3 marketing is fundamentally different from Web2. Imagine a marketing campaign in Web2 for a piece of software or a consumer packaged good. The campaign probably consists of paid ads using the Business Suite on Facebook, Instagram, Google Ads and maybe Twitter. The marketing team uploads the creative (that is, the visual elements of the ad), writes the copy, funds the campaign with a credit card and selects the audiences they want to reach. They probably start small, testing several combinations of creative and copy to see which converts users best off the social media platform to the product’s website. They A/B test to optimize the website to send visitors to the cash register, then scale up spending and marketese for “the amount of money invested” — with the best-performing creative on the highest ROI channels. With a Facebook or Google pixel, a tiny image on a website that can be used to track user activity, they can gather data on their target audience and retarget visitors. Using Google Analytics and other platforms like Mixpanel, they constantly monitor each step of the process, addressing any blockages.
Traditional marketers speak in numbers and abbreviations and spend their professional lives staring at Facebook ad managers. In a world where marketers have uncertain value to their organizations — since attributing credit for making a sale can be difficult — Web2 marketers tend to present their craft in scientific-sounding terms to appear credible. In my opinion, they miss the point and take the practice of marketing far from its growth hacker roots. The numbers and analytics in marketing are descriptions of reality, not the reality itself. Compelling stories, images and interactions drive users to take action, then the metrics describe how well they worked.
How traditional marketing practices were failing Web3
Unsurprisingly, the traditional marketers I met when originally hiring for the team at ConsenSys were befuddled by the idea of bringing a decentralized technology ecosystem to market. New Ethereum users weren’t going to be reached with a paid Facebook campaign. Determining the customer lifetime value (CLV) of a developer learning Solidity and comparing it to the customer acquisition cost (CAC) to acquire them in order to budget spend on a campaign to achieve ROI for Ethereum (whatever that would even mean) was a nonsensical approach. To add insult to injury, Facebook and Google Ads, the major Web2 marketing platforms at the time, had banned using crypto terminology in paid advertising. If their algorithms detected Web3 language (so much as the word “token” or “blockchain”) in creative or copy, the ad was automatically flagged and removed. In 2017, Web2 platforms from Facebook to MailChimp were so terrified of crypto that they refused to take marketing dollars from any blockchain-related companies.
So we wouldn’t pay the Web2 pipers to market Web3. It wasn’t even an option! Without these data platforms, Web3 marketers were free to return to our creative roots in storytelling and growth hacking. Web2 marketing is a scheme by giant data platforms to keep vendors reliant, so they have to keep paying every day to continue reaching their own audiences. Instead of the Web2 marketing approach, where companies must continue running paid campaigns forever to continue growing revenue, we focused on using the substrate of Web3 to design self-marketing systems, where aligned communities of users, builders and investors are incentivized to grow projects together. Web3 marketing is like staking a newly planted tree. The stakes are temporary: once its roots are established, the tree should stand up on its own. However, full self-marketing Web3 projects don’t spontaneously emerge and market themselves. The job of a Web3 marketer is to start the flywheel of growth until a community can take over. To start spinning this flywheel for a new Web3 project, marketers first need to bootstrap demand.
Source: Web3 Marketing: A Handbook for the Next Internet Revolution
What is a Web3 marketing funnel?
Sometimes demand already exists and need only be directed to the platform where it can meet the supply. More often, though, it’s contingent on the Web3 marketer to stimulate the demand for a product from zero, then channel it into a structure that transforms it into economic value. The best way to envision it is as a funnel:
- Discovery — the first moment a potential user encounters a product. This is the marketer’s opportunity to present the potential user with a memorable, differentiated value proposition that ideally creates its own category.
- Engagement — marketers are actively exploring using the product, with the goal to convert a user.
- Use — a potential user is converted to become an active user of the product.
- Retention — a marketer must retain users or they risk losing network effects or defensibility to competitors. A broken funnel can leak out of the sides and bottom, while a well-designed funnel is watertight and smooth, converting users through each step with minimal friction.
The steps of the marketing funnel are strung together by successive catalysts marketers refer to as “calls to action.” At each CTA (for example, “Click to download”) the user chooses whether or not to take the next step. CTAs are ideal points to measure whether the funnel is working. At each step, marketers combat the forces of indifference, skepticism and inertia, which can prevent marketing funnels from forming or break them later on.
The marketer’s job is to design the funnel, monitor the CTA catalysts at each step, and if they’re not working, decide whether to patch individual leaks or redesign the funnel entirely. Patches are often experiments with new messaging, a different channel or even a different target audience. Tests should be conducted with as little economic investment as possible, until a channel has been proven to deliver ROI. Then marketers should scale up investment. This is the modern marketing discipline.
Marketing funnel. Source: Web3 Marketing: A Handbook for the Next Internet Revolution
While the concept of a marketing funnel is almost indistinguishable between Web2 and Web3, the activities that take place along it are radically different. For a true Web3 project that aspires to be as decentralized as possible, the force that propels potential users from the top through to the bottom of this funnel isn’t paid campaigns on third-party Web2 platforms. No, marketing in Web3 is no longer an arbitrage that someone else (Google, Meta) is monetizing. It’s the community.
Community refers to the single category that forms when a Web3 project collapses those of investor, builder and user into a single, economically aligned group. Participants in this group contribute to the project in self-defined ways, sometimes contributing to its codebase, answering a challenge or participating in a bug bounty for a reward, and sometimes deploying capital into the project. Their incentives can run the full gamut from extrinsic to intrinsic. Some communities are primarily social groups that offer participants a sense of identity and shared purpose. Others are focused on various modes of economic value creation. In the context of the marketing funnel, Web3 community forms in the middle (you need to convert people to join it, after they first discover the project) and if done right, becomes a high-energy engine tank for retargeting, generating creative ideas, and getting practical help and support.
Unlike Web2 companies that Meta and Google have contrived to make forever dependent on their platforms, Web3 projects have the opportunity to design self-marketing systems. They need to bootstrap demand and initial community using practices that nearly eight years of Web3 marketing have demonstrated as proven and successful. Once the system is in place, however, they should make it part of their roadmap to decentralize the marketing function. Thanks to its potential to decentralize over a network of incentive-aligned community members over the long term, Web3 marketing has the potential to be more efficient and sustainable than in Web2; incentive design and building the right early community are the keys to success.
The Pandoraland Accelerator program aims to boost the growth of innovative Web3 products and helps promising startups reach their full potential by increasing their exposure through Pandoraland’s media platform.
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