Why Web 2.0 Brands Struggle to Succeed in the Web 3.0 Era
A comprehensive guide
Let’s take a closer look at the most recent mints from National Geographic and Porsche.
Let’s dissect it and see what could go wrong during the web2 -> web3 transition.
National Geographic
National Geographic released its first collection of NFTs on the Polygon blockchain on January 17, featuring photographs by sixteen different photographers. The NFT collection, titled ‘Good Morning: Daybreak Around the World,’ commemorates the revolutionary magazine’s 135th anniversary.
While the uninitiated expected a smooth transition from a loving magazine, their foray into web3 encountered several challenges that could have resulted in disaster.
What went wrong was as follows:
Poor market research
The Web3 community was unimpressed with the mint. ONE DAY BEFORE THE MINT, general audiences (web2 natives) were “educated” about NFTs. Furthermore, instead of using art from one of their incredible photographers, they chose a Getty image from BAYC (Bored Ape Yacht Club). As evidenced by the comments, their followers were both angry and shocked. Is it a lack of effort or total incompetence?
The KYC nightmare
Many people complained about the lengthy wait times for the KYC process. It appears that no one has gone through it before.
An anonymous launchpad
Instead of performing the mint on one of the more established platforms, National Geographic chose Snowcrash.
The Snowcrash crash
Snowcrash team decided to postpone the mint for a couple of hours. Everything appeared to be disorganized.
The art, on the other hand, is fantastic and affordable (around $200). They featured some of the best artists, including Mia Forrest, John Knopf, Delphine Diallo, Justin Aversano, Reuben Wu, Cath Simard.
Fortunately, after three days of public sale, Snowcrash announced the phase’s completion on January 20.
The conclusion of the public sale signaled the unveiling of the artworks purchased by buyers, as well as the beginning of secondary sales.
Everything worked out in the end because National Geographic has something to offer the audience. Despite the exhausting process, people were willing to go the extra mile to obtain excellent art pieces.
Let’s take a look at another recent example that does not appear to end well.
Porsche (mint still active)
The sale began on January 23 and is divided into five stages. The first phase (the existing one) involves 7,500 Porsche 911 NFTs that enable you to access “a new world of Porsche where the rewards are real and special to you”. Phase 2 (coming soon) will allow you to choose between performance, heritage, and lifestyle paths. Finally, phases 3–5 will enable you to create your own rarity.
What went wrong was as follows:
A large supply at a high mint price
7,500 NFTs appears to be a very random number and is extremely unusual in the current market situation at this mint price.
Porsche is a premium brand, which is understandable. But the fact that they expected $11M+ looks more like a cash grab than a “community project”.
The fact that the current floor price is lower than the minting one is a clear indication of a bad strategy.
Ineffective communication
Discord is closed to posts. Except for the tweets themselves, Twitter communication is also suboptimal and frequently non-existent. There are no Twitter spaces, and no responses to community feedback.
Poor utility and a hazy roadmap
There is no clear plan. In this case, Porsche appears to be far from a serious brand that strategizes properly. Finally, there is nothing luxurious about a luxury brand’s drop.
Despite National Geographic’s difficulties during the sale, the sale was completed successfully. On the other hand, Porsche’s web3 chances of success do not appear promising.
What can be improved?
Because the purpose of this article is not to criticize but to offer solutions for improvement, let’s look at what can be done better.
Big brand ≠ big results in web3
Being a well-known brand does not guarantee a smooth transition into web3. It’s a different market with different audiences, so plan ahead of time and determine your engagement model before diving in. It requires involving the web3 community, i.e. people who may trade your NFTs. You must listen to them.
Don’t get into web3 for the sake of getting into web3
National Geographic’s entry into NFTs makes sense because their incredible photographs are an integral part of their brand. It makes sense for a luxury brand like Porsche to do the same, but with proper utility and engagement in mind rather than clearly looking into ways to extract value from a potent market.
Education is essential
NFTs are unfamiliar to most people, and it takes time to educate them. Until the tooling improves, you must create guides to walk people outside of the space through everything. Furthermore, you must incentivize them to join by providing real utility that will entice them to dive into web3.
Hire web3 natives instead of traditional consultants
People who have spent a significant amount of time in the space can help you think outside the box and adapt to market trends and current conditions. They would also tell you that it is critical to first become a member of the community and PROVIDE before selling something later on. Furthermore, crypto natives would make you aware of importance of being invested in the space and long-term strategy. Not to mention the execution part, which must be as smooth as possible.
Final thoughts
We witnessed a lot of negativity and irony surrounding the recent mints. I don’t want to take such a stance because similar experiences only serve to set us back from more big names entering the space. Nonetheless, best wishes from the bottom of my heart. I will be pleased if I am incorrect and the Porsche project is a success. Every success in the space benefits all of us.
