Issue #2: The Web3 Marketing Challenge

Happy Monday and a big welcome to the 82 new subscribers who have joined us since last week's issue.

What's coming up in today's issue:

• The big marketing problem most web3 projects are facing right now.

• Mark Zuckerberg finds a way to keep tabs on us in the web3 world with Instagram digital collectibles.

• How might podcasting look in a web3 world? A closer look at one show that's already exploring it.

1. Hype is out. What now for web3 marketers?

If 2020 was the year of “this meeting could’ve been an email,” then 2022 is “this NFT could’ve been a JPEG.”

In the last week, we’ve seen Tiffany & Co. launching a range of NFTs, Gucci and Tag Heuer announcing they’ll accept purchases made in-store with Apecoin (a cryptocurrency), and Starbucks unveiling their web3 rewards program.

I can’t help but think: Did these need to be a web3 project, or are they capitalising on the hype around crypto and NFTs to get media coverage?

The first major wave of NFT projects (like CryptoPunks and Bored Ape Yacht Club) capitalised on hype and made a lot of speculators a lot of money. Then came the brands and celebrities. Some of them sold out in minutes, while Chris Brown’s project had only sold 814 NFTs out of 10,000 at the time of writing this newsletter. The dude has more than 100m Instagram followers—that’s a terrible conversion rate no matter how you spin it.

Chris’s failed project reminds us of two crucial elements when you’re selling anything: brand reputation and perceived value. His NFT launch was lacking in both.

Hype is no longer enough to sell an NFT collection. This is a great thing because now we can look beyond the pretty pictures and financial speculation. We can start to look at them for what they are: a killer piece of technology with so much potential value for our customers.

Tiffany, Gucci and Tag? I’m not convinced about their announcements yet. Starbucks, on the other hand, has a killer use case for NFTs: they’re expanding their existing loyalty program to include digital collectibles. If you’re a venti Pumpkin Spice Latte kinda gal, you might soon be able to show this off as part of your online identity—it’s almost the web3 equivalent of posting your daily coffee to your Instagram Story. Almost.

What this means for you: if you're exploring an NFT launch of any kind, you can't rely on customers to buy it just because it's an NFT. If you do, you risk your brand being left red-faced.

2. Zuckerberg is watching

Speaking of showing off NFTs as part of your online identity, this week Meta started rolling out their new “digital collectibles” feature on Instagram to more than 100 countries. Clearly, it hasn’t rolled out to me yet, as when I went to click on the “digital collectibles” link from my Instagram account on my computer, it tried to send me to the user @digital_collectibles. Oops.

If you want to see what the new feature looks like in action, check out @mybff.

On one hand, I love that I can show off my NFTs. On the other? I know that Meta’s revenue relies on data they hold about you and me. And in a cookieless world, this data is getting harder and harder to collect.

Two years ago, they tried launching their own cryptocurrency, Libra. If it hadn’t flopped so spectacularly, it would’ve added our purchase history to the bank of data they already have on us.

Oh, she bought a new dog bed? Guess we’ll serve her ads targeted to dog owners then.

Now, they’re going for a different move. If you connect your wallet to your Instagram account, you can show off your NFTs on your profile. But there’s a catch.

Last week I wrote about how your wallet is your web3 identity. Over time you’ll start to collect NFTs that represent your interests and the brands you align yourself with. Connecting your wallet to Instagram means that when you score that Starbucks Pumpkin Spice digital collectible, you’re telling Meta a lot about you.

And because all transactions on the Ethereum blockchain are visible to the public, once you’ve told Meta your public wallet address, they can see every single transaction you make using that wallet. Right now, that might not be a lot, but in the future? That could include every transaction from buying a coffee to buying a house. Not to mention other data that could be stored on the blockchain in the future, like qualifications and certifications, your credit score and your rental history.

When I finally do get access to this feature, I will use it. But I’ll take extra caution and create a new wallet purely to link to my Instagram account, and I’ll only transfer the NFTs I want to share with my followers.

What this means for you: watch out where you connect your wallet, and when in doubt, don't connect your main one.

3. What does podcasting look like in a web3 world?

Last week, I stumbled upon the first web3 podcast I’ve seen. Not the first podcast talking about web3—there’s no shortage of those—but rather the first podcast that uses web3 technology to run the podcast as a DAO. If you’re new here, a DAO stands for “decentralised autonomous organisation” which—defined simply—is an entity run by its community. In other words, Rehash: A Web3 Podcast is run by its community.

As a podcaster with 4 years and 500+ episodes under my belt, my eyes light up and my brain starts ticking quickly when I think about the different ways we’ll be able to use web3 to solve three problems most podcasters face: audience growth, monetisation and content ideas.

In the case of Rehash, the podcast launch was crowdfunded by selling NFTs. The community (i.e. NFT holders) gets to nominate and vote on which guests, topics and segments they’d like to hear on the show. This is a seriously cool way to overcome the struggle that creeps in every few months: I don’t know what to talk about on my show anymore.

Because the community owns a piece of the show, they now have an incentive to tell their friends about it. They have a vested interest in the show’s success.

As for monetisation, I’m not sure what Rehash has up its sleeve, but I’d love to see some kind of model where the community gets a % of sponsorship revenue distributed to them like dividends.

What this means for you: this model is likely to change the way that podcasts and other content mediums operate. Watch this space.

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Until next week,

Steph

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