How to market an NFT Project

A comprehensive guide to marketing an NFT project.

Image Credit: Bored Ape Yacht Club

It’s clear that go-to-market strategy and customer behaviour in web3 is vastly different from the way it was in web2. In web2, companies invested significantly in sales and marketing teams as part of a traditional marketing funnel that focused on generating leads, acquiring and retaining customers.

In web3, a new model for enterprise building has come to light. Replacing centralised leadership teams who make all decisions about a product or service, and using consumers’ data and free, user-generated content to do that, this model leverages the blockchain to bring users into the role of owners through non-fungible tokens (NFTs). This transforms marketing for web3 enterprises and has transformed how customers think about their role. The focus for this article will be on a specific type of web3 enterprise — particularly NFT projects. You can find a detailed overview of what an NFT is here.

So what does NFT marketing look like?

What practices can be borrowed from web2 marketing?

How does one prepare and future-proof themselves in a space defined by weekly rugs, bear markets and everything in between?

In short, how do you go to market and convince potential customers to spend their time, money and attention on your NFT project?

For anyone that’s new to the web3 landscape, I wanted to start with an overview of the evolution of the internet and marketing over the last 40 years.

An overview of the evolution of the internet and marketing in web1, web2 and web3. Source Credit: https://twitter.com/womenof_web3

As a16z puts it “Web3 aligns network participants to work together toward a common goal — the growth of the network.”

So what does that mean for marketing in Web3, specifically NFT marketing?

Here are 7 principles to consider in marketing your NFT project.

1. Think of your customers as co-creators of your brand’s value. The greatness of your community = the greatness of your brand.
2. Establish a clear and unique mission to inspire and build a community.
3. Once a community has been established, identify brand ambassadors. Elevate and incentivise them.
4. Think about utility as your competitive advantage in the market. It’s a mechanism for incentivising your community.
5. Tap into Key Opinionated Leaders (KOLs) and strategic partnerships that align to your NFT project, to drive brand awareness.
6. Develop an effective social media and growth strategy.
7. Define and monitor the metrics that matter. Use this feedback to iterate as needed.

Let’s break these principles down:

1. Think of your customers as co-creators of your brand’s value. The greatness of your community = the greatness of your brand.

In web2, businesses view customers through the customer acquisition funnel. This focuses on moving customers from awareness and consideration at the top of the funnel, through to conversion and retention at the bottom of the funnel.

In web3, tokens offer an alternative approach to enticing and acquiring new customers. NFT projects can use tokens to bring in early users and financially reward them for their contributions to brand building. Not only do these early users become evangelists who bring more people into the network and advocate the benefits of the community to their followers, but these users also:

a. Provide your project with unfiltered feedback loops on what’s working vs. what isn’t.

b. Act as beta testers for your project’s community, patient and willing to help when things go wrong.

NFTs incentivise customers to evangelise projects because they have financial upside and can benefit from helping grow that community. There is direct incentive for community members and customers. They want you to succeed.

“The major shift is to ‘make your customers owners,’ so that the early users and contributors receive part of the value they help platforms create, and eventually have governance over it and more control. We are essentially giving these companies to the users — and that’s the biggest societal social shift that we’re creating here.” (Bradford Stephens, Co-founder & Managing Partner at Blockchain Capital)

Think of your customers as co-creators and partners, working with you to create and benefit from the value created. As a result, align incentives for them throughout the funnel. When faced with a decision that’s hard to make, collect community feedback and crowd-source your decision making.

In web3, your “go-to-market” strategy becomes “go-to-community” strategy. Community is a core differentiator to the success of any NFT project. So how do you go about effectively building your community?

2. Establish a clear and unique mission to inspire and build a community.

NFT projects need to approach their community building through a clear mission for why they exist — i.e. what problem is your NFT project trying to solve and why are you the best team to solve it? This needs to be supported with a high-quality community, alongside the right organisational governance model to deliver on that mission.

Developing a manifesto can be an effective way to attract community members that resonate with the mission and long-term goals of the NFT project. For example, the Meta Angels NFT manifesto states that, “the value of Meta Angels lies in its network, the quality of the members, and the depth of our partnerships and programming that remain steady, regardless of market fluctuation. We care deeply about creating real, tangible value for our members. But we won’t base decisions on an irrational secondary market. We will not prioritize hype over substance, even if we take a hit for refusing to play that game.”

When crafting your go-to-community strategy, consider 4 key areas:

a. Community Design:

• What is your project’s purpose?
• What values will you imbue?
• What are your unique norms or rituals? (e.g. Trivia Wednesdays)
• What roles do you require to create a self-sufficient community? (e.g. Discord / Community Manager, Marketer, Partnerships Manager, Engineer, Project Manager)
• What is your roadmap and business plan?
• Where and how will the community’s purpose, vision, values and roadmap be documented?

b. Community Management:

• What roles and access will priority members receive? Will there be tiers of membership?
• How will roles be incentivised throughout the funnel — At awareness, consideration, conversion, loyalty and advocacy?
• How will governance and decision making occur? (e.g. Decentralized Autonomous Organization (DAOs))
• What support roles will be available for the community? When and how?

c. Community Engagement:

• How are you onboarding and welcoming new community members? (e.g. each new member gets paired with an onboarding buddy)
• How are you nurturing that relationship and building trust? (e.g. special perks unlocked depending on how long they’ve been a part of the community)
• How are you building connections between community members? (e.g. Discord social events, pay it forward channels)
• How are you activating community members to fully realise benefits and increase their overall engagement (e.g. providing them with an allowlist spot to mint your NFT? Members getting involved in work pods to contribute to the community?)
• How often are you engaging with your community members?

d. Community Co-creation:

• Are you organising projects within your community that members can contribute to? How will work be organised? (e.g. A Web3 guild is a collective of crypto-enabled developers, designers, and thinkers that share resources (be it knowledge or labour) in the pursuit of a common goal.))
• Can community members vote on which initiatives they’d like to support as a community? (This is an example of how the Decentraland DAO enables token holders to vote over decisions that impact on the content and future operation of the platform).

Peter Yang from Odyssey DAO, provides an overview of how NFT projects can build thriving membership communities, by examining three case studies — VeeFriends, Moonbirds and Meta Angels.

“All three projects built thriving NFT membership communities through: a) Creators who were committed to providing long-term value for holders, b) Community that prioritised people who care about utility vs. the quick flip and c) Utility that brought people together and encouraged them to hold long-term.”

3. Once a community has been established, identify brand ambassadors. Elevate and incentivise them.

One of the most exciting things about building in web3, is the opportunity for projects to deepen their relationships with their customers. Platforms like Discord allow projects to build superfan communities and reach their customers, 100% of the time. This unfiltered access provides opportunities for projects to crowd source innovation and co-create initiatives, all while gaining feedback.

Of these superfan communities, you can usually find a handful of individuals willing to advocate your brand and defend it through thick and thin. These are your brand ambassadors.

How do you identify a brand ambassador?

A good brand ambassador can be identified as an individual, via their regular and valuable contributions to the community, have garnered the trust and respect of fellow community members. Therefore, they command a certain degree of influence within the community.

Brand ambassadors are valuable because they bring credibility to your project and have the ability to reverse negative reviews. They can also hold the hand of users on the fence about your project, and welcome them in.

How do you incentivise brand ambassadors?

There are a range of monetary and non-monetary incentives that your project can employ to incentivise brand ambassadors.

Monetary incentives for brand ambassadors:

• Additional Tokens — Offer ambassadors additional NFTs based on their contributions to your community. This could include a tiered contribution model whereby highly active ambassadors unlock rare NFTs or additional tokens.
• Exclusive access to brand utility — Allow ambassadors to unlock access to additional utilities based on their contributions. This could include art airdrops, exclusive merchandise or vouchers to partnering products.

Non-monetary incentives for brand ambassadors:

• Allowlist spots — Provide ambassadors with spots in upcoming mints for other projects, by partnering with projects that are minting. These allowlists could be offered at a slight discount.
• Social and public recognition — Ambassadors are generally already fans of the brand, so giving them public recognition for their contributions can deepen that relationship. This can be achieved by using dashboard announcement channels to recognise them or retweeting their work with the wider community.
• Status within the community — Giving ambassadors a status or title within the community can go a long way. As part of this title, projects can offer ambassadors the ability to participate in generating ideas or decision making for the brand.

4. Think about utility as your competitive advantage in the market. It’s a mechanism for incentivising your community.

NFT utilities are ways to reward NFT holders and make them feel a part of a community or give them a sense of belonging. When defining the utility for a project, you need to consider what value your NFT serves the customer and how your team is uniquely positioned to deliver those. Set clearly defined and realistic expectations on utility and the roadmap for your project. This will bring in community members that are committed to the project’s mission, as opposed to those coming in for arbitrage or demanding instant utility from the project.

Considerations around utility for your NFT project:

a. Access to exclusive partners and advisors (virtual and in real life): Projects can provide token holders with access to a pool of exclusive partners and advisors to tap into as they grow their own projects. Access can be in the form of Discord chats, real life conferences or seminars. For example, Crypto Packaged Goods NFT’s utility is that it is “a token to unite the finest minds in web3”, with core members such as Jaime Schmidt, Chris Cantino, Randi Zuckerberg and Zeneca to name a few. Further, holding the CPG NFT provides members access to alpha chats and call seminars with leading entrepreneurs.

b. Access to products (virtual and physical): Projects can consider partnering with other web3 brands or leveraging relationships with web2 brands to provide token holders with access to a range of physical and virtual products. Surge Women NFT is an example of a project that leveraged partnerships with other brands to offer utilities to its token holders. As the website highlights, the Surge Passport NFT will encompass an ecosystem of perks in education, finance, and Web3 tooling that will grant you with crypto skin in the game. A few of these utilities include:

• Vouchers to purchase NFT domains
• Blockchain learning bootcamps and masterclasses
• Digital wallet vouchers
• Opportunities to receive development grants
• Access to networking summits

c. Promise of future value (e.g. social status, rise in token value): Projects that have experienced a meteoric rise or have been recognised by celebrities prior to launch, can leverage that traction to highlight the promise of future value for holders of their token. For example, owning a Bored Ape Yacht Club (BAYC) signifies holders not only have the funds to do so, but they join a community of celebrities. As BAYC puts it, when you buy a Bored Ape, you’re not simply buying an avatar or a probably-rare piece of art. You are gaining membership access to a club whose benefits and offerings will increase over time. Your Bored Ape can serve as your digital identity, and open digital doors for you.

5. Tap into Key Opinionated Leaders (KOLs) and strategic partnerships that align to your project, to drive brand awareness.

As media becomes increasingly decentralised, you will need to partner with Key Opinionated Leaders and like-minded communities, to play an important role in building awareness for your project.

What is a Key Opinionated Leader (KOL)?

Key Opinion Leaders (KOLs) are authorities in a field whose advice is respected by others in their field. They usually have a targeted audience specific to their niche.

How can you reach out to identified KOLs and build meaningful partnerships?

Once you identify KOLs or strategic partners that align to your brand, reach out to them via email or social media. Some tips to consider when doing this:

a. Write a punchy subject line

b. Keep the pitch short yet personal (Research the KOL to understand what resonates with them, and consider how you can bring your project to life for them).

c. Offer them with incentives and value. Think about what monetary or non-monetary value your project can provide them in return for a partnership.

d. Consider the hook — If you can tell a compelling story about the project, you’re more likely to strike up some interesting partnerships.

Leverage these partnerships as part of a social media content calendar. Host twitter spaces or podcasts to interview the KOLs and like-minded communities, get them to invite their followers and showcase your project. Partner with these individuals and other brands to give their followers special perks or access to the community.

How do you measure the success of your partnerships?

The metrics to track success against partnerships can fall into two key categories:

1. Brand awareness metrics, which represent increased community awareness of your project. This includes:

• Increased followers or community members (e.g. on Twitter, Instagram or Discord)
• Likes, comments, retweets
• Reach
• Traffic

2. Direct response metrics, which represent community actions and purchase intent. This includes:

• Website clicks
• Collection Mints
• Leads or email subscribers

6. Develop an effective social media and growth strategy.

Alongside these strategic partnerships, define a social media and growth strategy to grow your NFT project. The 4 key steps in designing and delivering an effective strategy includes:

a. Identify and set growth goals — Example goals can include sold out mint, more Discord members, increased social media reach on Twitter and Instagram.

b. Plan the social content — Build a target persona of your community and develop social media content that resonates and engages with them. Get creative, the opportunities are endless.

c. Build a content calendar — Once you’ve identified your primary goals and planned your social content, it’s time to build a social media content calendar.

d. Implement and measure your strategy — Once you’ve started consistently delivering your social media content, measure the results of your efforts. Given how quickly things change in this space, you should analyse your content every week to identify what is and isn’t working. A few of the most important social media metrics to measure include:

• Awareness — The number of times people saw your content as identified by impressions and reach.
• Engagements — The number of reactions, comments, clicks and shares your content gets.
• ROI — Conversions and referrals from external sources.

7. Identify and monitor the metrics that matter. Use this feedback to iterate as needed.

Some of the key metrics to track when building NFT projects, can be categorised into financial and non-financial metrics.

These metrics can be leveraged to navigate the quality, growth and success of your NFT project. Depending on the stage of your project (i.e. pre-mint vs. post-mint) some metrics will be more relevant than others. Given the pace of change in this space, relevant metrics will need to be frequently monitored and your approach will need to be iterated as the market evolves.

Financial metrics can include:

a. Estimated market cap — This can be calculated by multiplying your NFT’s 7-day average price by its total supply. A higher estimated market cap indicates more owners of the token may be willing to pay higher prices to purchase the NFT. A good tool to measure the estimated market cap is rarity.tools.

b. Volume traded — This represents the overall demand for your NFT collection.

c. Floor price — This can be used to monitor the entry price for your NFT collection.

Non-financial metrics can include:

a. The growth and size of the community across relevant channels — This can be measured by analysing Twitter, Discord and Instagram metrics.

b. The number of unique holders of your token — This is another measure for the size of the NFT collection, and can signify the amount of awareness it can receive. The more unique holders equals the wider the awareness and engagement net has been cast.

c. Quality of community engagement — This can be measured through the primary communications platforms used by the project. An example of this is tracking channel activity on Discord, in the form of:

• Member activation and retention
• Attendance on community calls
• Governance participation (who is voting on what, and how often)
• Work being completed against defined tasks

d. Net-new relationships and trust developed amongst community members — This can be measured through sentiment analysis surveys.

e. Diamond hand balance — This refers to the number of owners who have not sold out of the project, and can indicate the community belief in the long term success and utility of the project.

f. Sell out time — This refers to the amount of time it takes to sell 100% of the NFT collection.

g. Roadmap delivery — This refers to how quickly and effectively the project team delivers on each item within the NFT roadmap and can signify how quickly token holders will see utility.

As for what’s next?

The role of marketing will continue to evolve as the web3 landscape matures. Please remember none of this is financial advice, always do your own research.

Additional Resources:

Here are some additional resources to continue fostering your thinking around NFT marketing:

• The web3 playbook: using token incentives to bootstrap new networks: Captures how tokens overcome the cold-start problem of building networks for brands. — https://cdixon.mirror.xyz/NooXlkyxdtr2-hB8UJCEhK5vz_2CbhgGACmN6_G2FkE
• How to Drive Business Growth By Fostering Your Community: An overview of how to operationalise your community building efforts to align them with business outcomes. — https://future.a16z.com/drive-business-growth-by-fostering-community-gtc/
• Community ≠ Marketing: Why We Need Go-to-Community, Not Just Go-to-Market: Frameworks for considering your go-to-community strategies. — https://future.a16z.com/community-%E2%89%A0-marketing-why-we-need-go-to-community-not-just-go-to-market/
• A Framework for Network Effects in Web3: Summarises how Web3 networks unlock new species of network effects. — https://medium.com/@soumilsinghnz/a-framework-for-network-effects-in-web3-d415b6652d0b
• The New Creator Economy: A guide on Web3 creator platforms: Provides guidance and suggested frameworks for building communities in the new creator economy. — https://www.antler.co/blog/creatoreconomy2022

About me:

I’m Ash, a senior marketer and founder of Insider, a next-gen loyalty solution that’s powered by the blockchain. Learn more about Insider here.