How is marketing digital assets different from regular marketing?
For the past 10 years, I happily worked as an advertising copywriter on large, sometimes global brands like Heineken, McDonald’s, Vodafone and the Dutch Olympic team. I saw the results of my work in the streets, on tv and on beer cans around the world. Marketing cryptocurrency didn’t enter my mind. But I have been doing exactly that, for the past 5 months. Nevermind how this turn of events occured, suffice to say that I have been enjoying it immensely and learned a lot. About 5 months in, this is what strikes me so far.
You learn or you leave
The first thing is the learning curve when entering the arena of blockchain technology. It’s so steep, at times it felt like bumping into a lamp post. I asked questions at events and got pittying looks, with answers like: “Sorry, I assumed that was clear”. Mind you, I have had a decent academic education, and even taught at a renowned Dutch university. Feeling like the nincompoop in a room with 250 people was refreshingly humbling.
How is ICO marketing different from other marketing?
Starting backwards: solution-driven instead of need-driven.
It’s been said that blockchain is a solution looking for a problem. And for some blockchain companies, that definitely holds up. The core idea of good marketing is to identify a need in the market and then create a product or service to satisfy that need. In blockchain, you see companies that started with the technology and then retrofitted it into something people might be interested in. That’s fine if you find something that actually solves a problem, or satisfies a need. Of course, you then need to make people aware of that need or problem. That has been an issue for some really bright ideas that can disrupt or fully replace entire industries: few people in those industries consider the way they do things now to be a problem, yet. People in general don’t like change, but they like it even less when you tell them they have a problem, but just don’t realize it yet.
There are some great examples of companies solving recognized problems like counterfeit goods or dodgy ticket scalping that couldn’t be solved before: look up companies GUTS (GET), SEAL and Attrace. All have very real, very practical solutions that can only be achieved through the use of blockchain tech.
The target group is all over the place
The target group for investors in ICOs has to be a unique one in the history of investment capital.
First, a significant group is made up of the actual tech enthusiasts. They are the developers and IT guys, the nerds and the geeks. The smart kids of any age, and from absolutely anywhere. They are more interested in the how than in the why — even though there is also a love for anarchy and taking institutions down a peg that I suppose can also be found in the hacker community (but I’m going out on a limb here). The interesting thing is that they may not have invested heavily, but are in it for the intellectual stimulance and the revolution. They may not be buying your token, but can still be very influential. They are a tenacious force of fact checkers and will vet smart contracts, do the math on your tokenomics, read out your blockchain to match it to your public statements and love nothing more than calling bullshit. Loudly, on every forum your company may be on. In essence, they are the custodians, keeping the space as clean and transparent as it allows for. With their earned credibility, prolific writing and commenting, people buy based on their judgments. Get them in your corner and feed them information. Don’t expect great bedside manners, though. The instant messaging mindset seems to make smart, rational people behave like toddlers in a supermarket.
Part of this group is made up of early adopters, who bought plenty of Bitcoin before the 2017 December rally. They are the Coinonairres, the ones who saw it coming and are still playing the field with their newfound wealth, simply because they were never in it for the money. They will talk advanced tokenomics all day, with a couple of insider memes thrown in for teenage snickering. There is no way to tell then apart from college kids, and they can come from anywhere. The only way to gauge their virtual wealth is by asking how long they’ve been in the game. Anyone who spent over a thousand dollars 5 years ago should be pretty comfortable by now.
Then you have the topical investors, who did recognize the value of the innovation within their own industry. Say, bankers investing in Ripple. Or gamers investing in Asura coin. Supply chain managers investing in Walton Chain, Cora, or VeChain. AI contractors getting the EFX token by Effect AI. These groups are likely the best community to have. They will patiently hold on to your tokens since they believe in the project. And they will actively supply you with advice, sollicited or not.
There are the traditional investors who represent large capital looking for high returns. They bring technical analysis to the game, trying to predict the rise and fall of digital currencies with old school rules of thumb. The actual business idea isn’t that important to them, they are just looking for skewed odds — where the possible gains outway the risk of losing all. And with digital currencies and tokens, there seem to be plenty of those odds. They remain quiet, but can move markets and greatly influence token prices, if their funds are large enough. Those are best dealt with in private sales — but don’t worry, they’ll make that clear to you. Some are united in Syndicates, pools of buyers looking that vet ICO offerings and negotiate the best possible terms for the group. It’s the best way for individual, smaller players to benefit from large scale buying power. Just make sure you join a legitimate one, preferably one that uses smart contracts so you know what happens to your investment.
Of course, you will find the pure gamblers. High risk takers, looking for moonshots. These are the digital version of lottery ticket buyers, and with the skewed odds, who can blame them? Lottery marketing managers will tell you that the majority of their buyers come from the lowest income groups. At first, that seems odd, till you realize that they see the lottery as their only chance to escape poverty. On a similar note, on a trip to South-East Asia in January I was told that a number of the Cambodian poor suffered from severe crypto fever for the same reason, selling the few posessions they had to buy into digital currencies. That took a nasty turn as the market has crumbled ever since.
Finally, there are the bounty hunters. This the raucous army of present day online mercenaries. Investors, especially of the private, traditional kind, have labeled the size of the (maily Telegram) community as a tell-all metric for future ICO success. There is something to be said for valuing great community support — especially the companies that provide the more innovative consumer-facing use cases have their share of true brand ambassadors — but making it all important has led to the bounty phenomenon. Companies see themselves forced to bloat their Telegram community channels by giving away free tokens to members who join, tweet or retweets, upvote Reddit posts, or bring in other members. Tokens are not in short supply in the pre-ICO stage, so for any internet connected person who has or makes time for it, it’s easy to fill your bags. As a result, we see many members from low-wage countries like India, Sri Lanka and Indonesia fill the communities. Clicking away, possibly with several online identities, can be a lot more rewarding than their alternatives in the local job market. If it were just numbers in the Telegram group, it would be fairly harmless, but bounty programs also have them promoting through posts, tweets, and commenting wherever possible. No one can expect bounty hunters to be the best copywriters, so they generally opt to copy paste generic messages along the line of “Really excellent project. Invest now, be rich soon.” With praise like that, who needs criticism? More than anything, it undercuts companies’ credibilty in an already suspicious market.
Check your privilege — competition is global
It’s very global, and very merit-driven, especially on the technical side of things. If you want to become aware of your western privilege, come work in blockchain. All of a sudden, you find yourself competing with bright minds from absolutely everywhere. Willing to start working for monthly wages that wouldn’t rent you a parking space in Amsterdam, the potential for earnings has been spotted by developers all over Asia and Eastern Europe. Scarcity will push up the wages as demand is bound to grow over the coming years. So if you’re good, you will still stand to make a killing. If not, well, you can always join me in marketing.
And it’s pretty sure of itself
Finally, for all the Fear Of Missing Out, and the Fear, Uncertainty and Doubt, I find the giddy optimism the most striking thing. Blockchain technology is to be the panacea for most things wrong with the internet, financial markets and governments, if you listen to the visionaries. It provides absolute certainty without the need for trust. Full transparency without sacrificing privacy. Transaction efficiency without loss of quality. It adds integrity to internet and the economy as a whole. And of course, there will be lambos for everyone.
This optimism defies logic. The course of the main digital currencies like the Bitcoin and Ethereum is volatile, but has generally been decreasing for months, and 99% of their value is based on speculation of future applications. Yet new companies enter the market every day. Bad news and adversity from formidable institutions like governments and the banking sector is regularly taken in stride. The number of people determined to hold on for dear life (HODL) is steadfast. Exchange rates drop, but bounce back. There is more than the ultimate belief in the revolution that drives this. It’s the heady feeling of being part of the group of early believers, the ones who appreciate the infinite potential of blockchain technology before others do. The idea of having superior knowledge over the masses strokes the ego. But it’s not just hubris or mass hysteria. Once you’ve put in the hours to wrap your head around the blockchain and its possible consequences, it’s hard not to get excited.
René van der Hoofd is a freelance creative strategist and advertising copywriter based in Amsterdam. He writes about advertising, branding and, to his own surprise, cryptocurrencies.