Three Little-Known Things to Grow Web3 Into The Real Thing

“Products don’t sell themselves.”

\ That’s why even Edison conducted comprehensive marketing for the light bulb in 1880, transforming it from an innovative invention into a household necessity. In 1955, P&G introduced the first fluoride toothpaste, but consumers were skeptical of its cavity-fighting claims, viewing toothpaste as purely cosmetic. It took over five years of extensive marketing before P&G achieved widespread adoption.

\ It's natural for people to resist change, but it's curious how we often hesitate to embrace innovations that could benefit us. While innovative technology has the potential to enhance our lives, realizing this potential requires a shift in consumer mindsets. Marketing plays a crucial role in driving this adoption and turning technological possibilities into everyday realities.

Since joining the crypto industry in 2018, I have had the privilege of contributing to the marketing of various crypto projects. This experience provided me with the opportunity to engage directly with a diverse range of individuals in the crypto space, offering valuable insights into their needs and behaviors. I learned what people expect, how they respond, what drives their happiness or frustration, and how these emotions translate into actions and outcomes. This led me to realize that Web3 requires a completely different marketing playbook compared to traditional or Web2 marketing.

\ For instance, all crypto projects I've worked on have placed a strong emphasis on branding, often asking me to spend a significant amount of time creating and managing their websites. However, how often do crypto users actually visit the homepage of a specific project? Crypto enthusiasts primarily congregate in community channels like Discord or X.

\ While traditional marketing centered around the homepage, in Web3, community channels have become the new hubs, with the opinions and activities of community members serving as key branding elements. Social media is where the project's operations actually take place. It's akin to the ancient Greek Agora, a hub of political, economic, and social activity.

\ A successful marketing playbook can only be developed after gaining a thorough understanding of customers. Therefore, the primary focus of my marketing efforts was to gain a deep understanding of our users through community channels. In this article, I will share three key insights that could form the backbone of an effective crypto marketing playbook.

In traditional marketing, customer segmentation involves dividing a company's customers into distinct groups. However, Web3 customers, as I've observed, do not fit into segmented groups. Fundamentally, all customers of a Web3 project are ‘token holders’. Those who actively use the protocol become ‘users’, and those who participate in DAO governance are considered ‘community members.

\ Therefore, the customer structure in Web3 is not about segmentation but about layered inclusion, where each layer encompasses the previous one.

\n * Web3 Customer Structure

| Customer Layer | Community Member | User | Retail Investor | |:---:|:---:|:---:|:---:| | Qualifications | DAO participant \n dApp user \n Token holder | dApp user \n Token holder | Token holder | | Goals | Project’s success \n dApp utility \n Token price increase | dApp utility \n Token price increase | Token price increase |

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\n \n ==Most Web3 projects lump all customers together as community members, regardless of their layers, and focus solely on expanding their user base. In my view, this is the fundamental reason why Web3 adoption has become directionless and stagnant.== Since each layer has its own expectations and contributions, marketers should tailor their strategies to address them as outlined below:

The community members are undoubtedly the most foundational layer. In Web3, the community serves as both owners and contributors. Thus, the future of the project depends on the community's quality—how capable, motivated, and loyal they are. “Community is where its members get daily dopamine." This is the coolest, most succinct community management principle I've encountered in the Web3 space. The ideal Web3 marketing strategy revolves around continuously engaging the community with this mindset.

\ ==Successful branding is not about making the brand itself cool; it is about making its customers feel cool.== In other words, consider whether your marketing programs are motivating and exciting the community, ultimately leading them to feel proud to be part of it. This is the direction in which Web3 branding should evolve—more than just a nice website or visual design.

The user layer is crucial for scaling the project and cultivating future community members. In the current nascent stage of Web3, educating users on why they should use a product is more important than how. In a previous article, I criticized the widespread use of airdrops to artificially inflate user bases. Consumers are often smarter than brands, and current airdrop marketing is merely attracting airdrop farmers.

\ Recent issues with fake accounts and bots during the Megadrop IEO event and ZKSync’s airdrop highlight the risks of airdrop marketing. In fact, the problem is deeper. Users who stay after claiming rewards may create toxic communities focused on price speculation, making it harder to attract quality members.

\n Regardinghow to use the product, many projects struggle with user onboarding, offering either overly complex or insufficient guides. This issue is compounded by the incomplete state of many systems, where timely risk alerts become crucial. The recent Black Monday exemplified this problem, with users incurring losses due to unadjusted collateral ratios. Web3 marketers must therefore focus not just on promotion, but also on providing preemptive risk management.

Typically, retail investors are not the primary target for Web3 marketers, just as traditional companies do not target stock investors. However, since token price affects community morale and reflects product and marketing performance, Web3 marketers must recognize that retail investors are a stakeholder group that requires continuous management.

\ This involves closely monitoring their feedback, ensuring the accuracy, timeliness, and quality of the information, and proactively managing the dissemination of this information across both internal and external crypto channels.

\ The biggest irony for a Web3 marketer is that tokens are integral to the functioning of the Web3 ecosystem, yet a marketer cannot directly market tokens. The etymology of the word 'token' is 'representation.'

\ Indeed, tokens represent the project, even when the project team discourages price discussions and responds to such discussions by saying, "We just keep building." Are there ways to market tokens more effectively? This consideration led me to my next insight.

Why did the Securities and Exchange Commission (SEC) issue a Wells Notice to Uniswap Labs in April 2024?

\n The SEC’sceaseless intervention is tied to the nature of Web3, which isn't just another IT sector but a token-based economy. Even in the marketing space, financial marketing regulations are particularly stringent due to the sensitive nature of financial products and their potential impact on consumers and the economy.

\ In my experience working as a marketer at EY, I witnessed firsthand how challenging it can be to promote financial products, with most marketing messages being rejected for their potential to mislead.

\ But wait, Web3 marketing’s case is different. Although blockchain technology is often described as self-executing through code, my experience in the Web3 space has shown that it heavily depends on human input. At its core, ==Web3 is a fusion of decentralized technology and human collaboration. Just as blockchain nodes broadcast transactions and blocks to ensure transparency and consensus worldwide, community members broadcast information, ideas, and passion, fueling the ecosystem's growth.==

\n The empowerment of individuals is the ultimate value of the Internet. The term 'user-generated content' emerged in the early 1990s, gaining significant traction with the advent of Web 2.0. TIME Magazine aptly recognized 'You' as the Person of the Year in 2006. This shift altered marketing trust dynamics, as consumers began placing greater trust in peer-generated content over brand-driven messages.

\ This phenomenon has been an established trend for over two decades, signifying that the marketer's role is now shared with consumers.

\n Given these two circumstances - sensitive regulatory issues and shifted trust dynamics - Web3 marketers should focus on supporting the community’s broadcasting efforts rather than directly selling or promoting themselves. This means equipping community members with the necessary resources such as information, content, and marketing programs to empower them and encourage their continued active participation.

\n Building a community of actively engaged members was once a marketer’s dream. In Web3, this dream is attainable for any project. I've come to think that the members who demonstrate loyal participation deserve the title of 'core contributors,' while the project team members might be better described as 'full-time contributors.'

The Polkadot team faced backlash from its community after spending $37 million in DOT tokens on marketing in the first half of 2024. Community members raised concerns that such a significant expenditure could negatively affect DOT’s price. Some argued that hiring influencers to tweet a few times, say at a cost of $20,000 per month, would have been more cost-effective.

\n It is perplexing that current marketing trends continue to rely on Web2 strategies. Influencer marketing comes with its drawbacks: increasing regulatory scrutiny and authenticity concerns, debatable effectiveness due to perceived insincerity, and potential damage to influencers' credibility when promoting subpar products. Moreover, Web3 technology is designed to mitigate single points of failure through decentralization. Why do marketers continue to lean on a few high-risk influencers?

\ The collective intelligence of distributed community networks is a force to be reckoned with. A message pushed by centralized entities cannot compare to the creativity, persuasiveness, and marketing power of diverse ideas and voices generated by the crowd on a global scale. We often encounter more insightful comments than the main posts on Web2 social media.

\ Yet, negative behaviors are also prevalent, making it challenging for user communities to be established as core marketing channels. In contrast, Web3 communities collaborate towards shared goals, resulting in more constructive contributions.

\ I consistently learn from and am inspired by community members, often receiving a daily dose of dopamine from their contributions. I have worked to promote these individuals and elevate their status within the crypto community. The project team's recognition builds credibility and encourages ongoing engagement. When a high level of community responses accompany this recognition, these members grow as influencers.

\ A virtuous cycle is established, where great insights spread, motivating others to contribute even better ideas, and attracting new valuable members.  A genuine and thriving community, where organically grown influencers and new aspiring leaders are nurtured, is essential for driving the authentic growth of Web3.

\ As a marketer, I have had the privilege of witnessing countless moments when even the most unexpected individuals come up with brilliant ideas. It’s our role as marketers to capture these sparks of creativity and amplify these shining moments. Especially in Web3, these are the times when we feel most fulfilled and proud of our work.

Web3 is a fusion of technology and humans. Its open-source technology can be forked, but genuine communities cannot. These communities can only be built through the authentic efforts of Web3 marketers. The goal of Web3 marketers should be to cultivate a network of community members that others may aspire to copy but can hardly do.

\ Developers BUIDL products. Marketers BUIDL trust, loyalty, enthusiasm, and affection. Marketing is more than just promoting products; it’s about ==caring==. Successful marketing is ultimately about people, beyond the product.

\ Naval Ravikant said, “Learn to sell. Learn to build. If you can do both, you will be unstoppable.”  Web3 will reach its full potential and become unstoppable if its marketing is on the right track.