Bithumb Global AMA Live with WOMProtocol (WOM)
8th April 2020, Wednesday
Recap of Live AMA with the Founder & CEO of WOM, Melanie Mohr
AMA Link >> https://t.me/bithumbglobal_EN/101997
Q1: Can you explain your thoughts and ideas around word of mouth advertising? How is word of mouth advertising better than traditional advertising and marketing campaigns?
Melanie: The marketing industry understands that customer referrals are the most effective form of marketing. These word-of-mouth recommendations are shared online 2.1 billion times each day in the form of videos, photos, or text. They have the highest conversion rate due to the level of trust between the recommender and recommendee.
Yet brands and marketers do not have an effective and scalable way to properly identify, incentivize, and measure trusted peer-to-peer recommendations. Even worse, methods such as affiliate and influencer marketing can compromise the trustworthiness of content and its
Word of mouth is more effective and has a higher conversion than any currently-available marketing channel because the messages come from peers and not the companies themselves. This has been proven by numerous studies across decades. Here are a few standout figures:
92% of people trust recommendations from friends and family over any type of advertising.
74% of consumers identify word-of-mouth as a key influencer in their purchasing decisions.
68% of people trust online opinions from other consumers, which places online opinions as the third most trusted source of product information.
and on top 50% of all purchase decisions have their origin in word-of-mouth — a recommendation from someone we trust.
John: We can see some of the problems everyday. An influencer becomes popular, then makes a deal with a brand, and now has the financial incentive to promote that brand, which lowers his overall trustability. It is a viscious circle.
Francis: I also would add that ‘word of mouth’ is a natural mechanism that people use in their daily lives to communicate interest. The idea would be to create a frictionless way for that ‘protocol’ to be useful / beneficial to the decentralized community.
ie -> take something natural and useful to people, and create a decentralized mechanism that can convey it far and wide.
Q2: Some pretty solid figures there. Since the YEAY app has been touched on, can you explain the relationship between WOM protocol and the existing app YEAY, it appears most of the team founded and have previously or still work at YEAY?
A2: The WOM Protocol idea was born out of a pivot of the YEAY app and when the idea grew into its own project beyond the YEAY app, the YEAY team founded WOM Protocol Pte. Ltd. Particularly because WOM Protocol has no business model due to its truly decentralized goals, it relies on YEAY for resources including personnel and funding. The YEAY investors have supported the WOM initiative which makes WOM so strong. The YEAY investors are not typical crypto investors but institutional investors with amazing portfolio companies that present huge partnerships opportunities for WOM.
Happy to also name some of our early supporters and backers.
Q3: Let’s move onto how the whole ecosystem functions then. Can you breakdown the different types of stakeholders and participants involved in the WOM ecosystem, what do each of these layers consist of and how will they be used?
A3: There are five different types of stakeholders and participants within the WOM Ecosystem:
First we have Content Creators
-Create WOM-relevant content on a platform.
-Earn WOM Tokens for user engagement with WOM content.
-Stake WOM Tokens as collateral to receive the right to participate in content creation in exchange for the option of earning WOM Token rewards.
-Lose WOM Tokens if cheating (fake accounts, click farms, collusion, etc.) the WOM Ecosystem.
Then consumers or platform users. They:
-Receive access to high-quality, trustworthy WOM content.
-Benefit from recommendations of trusted peers.
-Engage with WOM content on a platform.
Third are Authenticators who:
-Validate the content according to WOM relevance.
-Earn WOM Tokens for validating WOM content.
-Stake WOM Tokens as collateral to receive the right to participate in content validation in exchange for WOM Token rewards.
-Lose WOM Tokens if cheating the WOM Ecosystem.
Next are Brands, Retailers, & Marketers
-Use WOM Tokens to gain access to user-generated WOM content.
-Create a connection to new consumers through their fans.
-Can add links to WOM content and track engagement.
-Can increase the reach of specific content.
-Can incentivize the creation of content about a specific product.
-Can reward their fans just for being loyal advocates.
And lastly Content Publishing & Distribution Platforms. There are some nuances between the different publisher and distribution platforms that can adopt and use the WOM Protocol that we don’t have time to get into in an AMA.
But overall, these platforms:
-Provide interfaces to the WOM Protocol for creators and consumers.
-Earn a share of content creator rewards.
-Operate as trusted intermediaries for tracking content interactions.
-Design news feed algorithms to properly place authenticated content supported by brands to maximize platform rewards.
Q4: Can you please explain the staking system WOM will use and do you have set reward amounts for staking WOM tokens? So what’s the current state of development and what will be released in the near future? So what’s the revenue model for WOM and do you have any figures on how much you have generated so far or what your future projections?
A4: Content creators must stake a certain number of WOM Tokens to get their content authenticated. If the quality of the content is evaluated above a certain threshold, the content creator may earn WOM Tokens. If the content is rated below a certain threshold, the content creator loses their staked WOM Tokens.
Authenticators likewise stake tokens for the right to authenticate content. If their authentication falls within the majority consensus with other authenticators, authenticators can earn WOM Tokens. If their authentication is not in the majority, they lose their stake.
Q5: How about governance, how does that work on WOM? So if you can, run me through the main utilities for the WOM token on the platform? So atm, is there currently any use for WOM outside of speculation or utility is coming at a later date? What sort of dApps would you initially be looking to integrate your protocol?
Melanie: The WOM Protocol will scale an entire ecosystem to enable monetization of word-of-mouth content for brands, creators, and publishers. The WOM Protocol will become the main marketing channel for brands and the main revenue stream for content platforms.
Jerry: Ultimately, WOM Protocol Pte. Ltd. will dissolve so that the WOM Protocol becomes a DAO that cannot be controlled by any single entity.
Therefore, as a DAO, there is no revenue model for WOM Protocol Pte.Ltd.
Rather, as already discussed, the WOM Protocol is currently supported by the YEAY investors, etc.
Francis: Development is currently focused around maturing the working prototype — we’re around 90% complete now, and the system is functional and in use. We’re currently working on the more advanced (performance based) reward scheme for creators, we expect that to be available in less than a month.
Jerry: Currently the governance relies on a central entity (WOM Protocol Pte. Ltd) to monitor and curate the process. Most decentralized networks are in their nascent stages right now, as is ours. This is expected, as the fundamental ideas and development of related infrastructure need time to mature. The idea is to replace components with decentralized equivalents, gradually and piece by piece as they reach that maturity and safety level. The complementary technologies required to completely decentralized an application, network or system of WOM’s scope do not currently exist — but they will soon.
In the early stages, WOM Protocol Pte. Ltd. will monitor the growth of the ecosystem and make changes and updates as needed. However, as described earlier, the ultimate goal is to transition to a DAO and have the community directly governing the WOM Protocol.
So governance is one utility of the WOM Token, but it’s a utility that will be implemented far down the road.
The other utilities are:
Reward unit: Brands, content creators, and content authenticators all use the WOM Token in various ways to reward actions within the decentralized WOM Ecosystem.
And earning rights: Content creators and authenticators need to stake WOM Tokens (as collateral) to make their content available for campaigns.
John: This is an important point. The team is dedicated to steadily move to a fully decentralised system, but realizes that we cannot do that at the start. We need time to understand behavor, to understand what works and what does not in the code and infrastructure, then migrate to more and more decentralization as it becomes stable and reliable. Pure, initial decentralisation does not usually succeed.
Q6: You recently partnered with Advanced store and Groupify, can you go into some detail about who these two companies are, how the partnership came about and what you will be looking to achieve together? You were also accepted into a Adidas accelerator program, how did this come about and how does the accelerator program work? Are there any blockchain projects that you’d ideally like to work with in the future that could bring value to your platform?
A6: Advanced Store is not only a partner but also one of our early supporters who purchased WOM in private sale. One of our very strong crypto and blockchain asset focused angel investors introduced us to Advanced Store. Advanced Store is an industry leader in the European online ad-display industry. Excisting since more than 13 years, 900 brands on board and thousands of publishers.
We already integrated their tech to allow word-of-mouth recommendations to also convert directly in sales through affiliate linking. In the YEAY app users will soon be able to make a video with a product recommendation and their friends and followers will be able to purchase the products directly through the video. Every creator is instantly also an affiliate without signing up with a brand or advertiser.
Groupify is another YEAY like app / platform that was seeking an additional revenue stream and is also enabling word-of-mouth recommendations. After testing the WOM Protocol with YEAY this is another platform that will integrate.
Adidas was one of the first brands that really believed in our new MarTech solution. We were selected with both companies — YEAY and WOM Protocol into their accelerator in 2019. It was a great experience and an amazing oportunity to develop the WOM brand campaing manager technology so closely with a fortune 500 company.
We will also run a pilot with adidas and YEAY in Q2/Q3. adidas customers will be able to make product recommendations with the YEAY app and get rewarded with WOM. adidas will use WOM token to reward creators and boost content.
Q7: This is honestly the first time I’ve heard about WOM and it sure seems like a really interesting project. Aside from trading competitions and current AMA’s , what has the team been up to the past year that has the community involved?
A7: We already established many local communities on Telegram. You can join our Global English Community but also local ones: Turkish, Arabic, LATAM, Brazil, Germany, Russian, Indian, Indonesian, Chinese, Korean and African.
We will soon start with exciting bounty campaings in our communities. Please check them out if you are further interested.
Q8: How can companies or social media platforms that want to use the WOM infrastructure benefit? Can the WOM infrastructure be integrated into many platforms or social media environments?
Jerry: This was touched upon earlier when we discussed the various stakeholders in the WOM Ecosystem. The WOM Protocol can be integrated into or adopted by any platform or social media environment that enables users to create, display, or otherwise interact with recommendations.
These platforms either earn a share of content creator rewards earned on their platform or pay to use WOM content for the benefit of their users.
Chris: To expand on Jeremy’s answer. Social Media organisations can integrate in many way, dependant on what they want to achieve. They can help their users generate content, and they can display content on their systems. Or, they could simply fully integrate WOM into their life and use word of mouth in place of current advertisements.
Q9: How is WOM platform better than the traditional Word-of-Mouth?. For my recommendation to be reliable, I must know the person to whom I am sending the information. This could easily be done directly in person or via WhatsApp, for example. Why should we choose WOM?
Chris: The problem with traditional word of mouth is that it is often after the fact. You get a recommendation about a different product after you tell people you have purchased something. WOM allows you to see genuine recommendations prior to the purchase decision. We believe, and the statistics above show, that a genuine recommendation is valuable, regardless of source.s.
Francis: Word of mouth is a natural process (as we described earlier), the idea of WOM is that participants get to benefit from it. It simply enables mechanisms for observing, curating and rewarding these social processes.
Question from the Community
Q: WOM protocol is a blockchain project which seems trying to build AD-free ecosystem. Please explain how blockchain plays. Is it the role in it? How easy is it to implement the WOM protocol?
Melanie: We try to make it easy through SDKs/APIs that social networks, e-com platforms, digital publisher will be able to integrate.
Q: I would like to know which types of benefits Content Creators and Consumers will receive from wom protocol compared to the current centralized ecosystem?
Francis: As a decentralization ‘purist’ -> Essentially we can see how the centralization of advertising has resulted in the usual opaque and anti-competitive business practices. It’s ok if you’re a huge company, but for the small players a lot of it is essentially weighted against them. The idea of decentralization in general is to try and ‘spread out the power’ -> power in this case meaning the ability to get involved, play and earn. In it’s fully decentralized final instance, the WOM protocol will not be taking rent, not cutting out the small players, and allows the various participants (creator / viewer / purchasers) to be the primary beneficiaries of the entire process. Basically, it’s not just ad-free, it’s mainly ‘ad-corporation-free’.
Q: Can all contents of brands be included in the WOM infrastructure? What content can qualify for reward? Can these contents be scaled for each platform between brands?
Melanie: We have a campaign manager for brands/advertisers to access WOM authenticated content. Think of a google adwords kind of campaign manager just not limited to Google. F.e. adidas can find a product recommendation form a teenager who loves adidas sneakers there but he is not a influencer, he has just 50 followers. Now adidas can boost the content and show it to more people. This is also good for the teenage creator and for the authenticators that validated the content of the teenager and also for the platform where adidas wants the content to be shown to more people. Everyone benefits and gets WOM based rewards.
WOM can be used in any industry, verticle and by any brand, from fashion to beauty form tech gadgets to travel to music or entertainment.
Q: WOM users and content creators can gain from a unique monetization model on WOM protocol platform. How will WOM protocol reward mechanism work to give accurate reward to participants in WOM ecosystem and which standard does reward base on? As we know, content is still key but existing platforms can’t adapt: no monetization, limited community, limited content options, etc. So, how will WOM protocol resolve these problem to response the requirements of Gen-Z, Influencers and Advertisers?
Chris: The WOM protocol rewards participants based upon the actual engagement of the product. We collect details of every interaction with content. We record whether they like the video, share it etc. We attribute a proportional value to each interaction. Each day, we add all the interaction up and reward based upon that. In addition, if a brand or other organization wants to utilise the content, for this video, this interaction total has multipliers attached and therefore more is paid. The actual payment comes partly from a centralized fund, more comes from the brand, and then if the content is used elsewhere, then the user of the content will contribute as well.
Melanie: WOM also uses performance based pay outs, how many views, likes, clicks, shares a piece of content is able to get. However it is also important how the WOM authenticators rated the content: authenticity, creativity, positivity. On top even a content that usually wouldn’t get a huge reach can be boosted when a brand/advertisers puts marketing spend inform of WOM tokens behind it. This solves the problem that even someone who is not an influencer can reach scale with his/her content.
Q: WOM Project is basically working on Online Marketing Platform! But, Can you explain, What’s the main role of Blockchain Technology in Online Marketing / WOM Project?
Jerry: The WOM Protocol is a marketing solution for advertisers, as well as a revenue opportunity for platforms and people who make recommendations.
Blockchain enables us to create an authentication protocol to validate recommendations in a way that maintains the trust and honesty of word of mouth recommendations. No central party is needed for authentication and therefore users don’t have to worry about a central party swaying the results.
Q: WOM protocol is a blockchain project which seems trying to build AD-free ecosystem. Please explain how blockchain plays. Is it the role in it? How easy is it to implement the WOM protocol?
Francis: The core parts of the protocol (the mechanism that allows users to participate in consensus) are appropriate for the level to which blockchain has matured today. The processes beyond that will need to remain in prototype form until decentralized equivalents begin to appear.
Q: According to statistics, Many Big Companies like Google, Facebook, Twitter, etc Generates Billions of USD ($) just from advertisements! But, WOM Concept is AD-Free Marketing! Can you tell us How it’s possible? As can we expect same revenue / Earning with Ad-free Model as Ads Model?
Melanie: We just replace the advertisment format and allow brands/advertisers and publishing platforms to use user-generated content with honest product recommendations in it. The WOM Protocol is even a future revenue stream and solution for Facebook, Google, Twitter. We hope they join one day. As WOM is truely decentralized in its approach we don’t see any reason why they should not want to join.
Q: How WOM Ad-free Model is Consumer & Brand friendly? How Brands can do Marketing & attract users without Ads? I mean, If Brands don’t make Ads, then how consumer know about Brand & their Competitive advantages?
Jerry: We find out about brands and products all the time through our friends and others we see online. You ask other people when you’re wondering about “the best x” product or want to know about “a good y company” that offers something you’re looking for. Everything you learn is not related to advertising.
People are way better than brands at describing why a product is good — and largely because they aren’t biased and you trust what people say.
The WOM Protocol merges the best of both worlds: you learning about products through recommendations not ads, and brands being able to leverage those recommendations and glean insights from them.
Q: Defi seems to be a useful case and concept right now. Many and many finance-related blockchain projects are built with Defi inside. So, beside cooperating with banking, has your team ever thought about integrating Defi into WOM platform ?
How easy is it to use WOM in an existing infrastructure? And how does WOM ensure the security of user data?
Could you tell some products you have built for your businesses?
What do you intend to do to keep increasing adoption? What is your vision in next few years?
Francis: DeFi is already a vague term. There is currently work underway to approach the connection between FIAT and crypto in a newer (very user-friendly) and highly decentralized way. The details obviously go beyond the scope of this AMA, but suffice to say there’ll be many more interaction points between ‘financial instruments’ and the WOM protocol as this project continues.
Q: Can You Explain How does the Curators Validate any content? What are the key Point they check to Validate any content?
Francis: That’s entirely up to them — hence it’s their word, and their mouth :) Essentially they are looking to confirm that the content conforms to what they feel is authentic and useful. All recommendations are then passed into a consensus algorithm, that determines which way the community ‘voted’.
Q: Is WOW different from Affiliate Marketing? What are the highlights of WOW over Affiliate Marketing? What is the mechanism to encourage people to join the WOW network?
Jerry: With affiliate marketing, the affiliate essentially says “buy this thing because I get paid when you do”. An affiliate marketer could truly believe in the product, but the consumer can never be sure.
With the WOM Protocol, all recommendations are authenticated by the general public first and only after they pass authentication can they be rewarded. Therefore, authentication process enables the consumer to have full confidence in the honesty and authenticity of the recommendation.
Various people join the WOM Ecosystem for various reasons. Someone might join because they want to earn from the recommendations they make, some might join because they want to authenticate recommendations and keep crap out and earn while doing it. Someone might join because they’re tired of the inauthentic recommedations they continually see frim influencers on IG or some other platform, etc.
Q: What’s the Future Roadmap of WOM Project? What’s the upcoming events we will expect to WOM ?
Melanie: Besides the tech updates that are continiously coming and the adidas pilot we will soon have another listing. However I need to say that Bithumb Global and Bithumb Korea gave us the most amazing start a project in the blockchain space could have dreamed of. Incredibly supportive in all means.
I really want to thank the amazing Bithumb Global team here and also in the headquater and locations around the globe! You have build an great platform and you can count also on our community support in all possible ways!