Web3 Marketing: A Handbook for the Next Internet Revolution

by Amanda Cassatt

Without monetization possible at the more decentralized protocol layer, centralized business models needed to be created on top of decentralized architectures to capture value.

But even more interestingly, numerous law enforcement personnel working on the case proved unable to resist a personal fascination with Bitcoin: federal agents investigating Ulbrich tried to siphon from the Dread Pirate's treasure chest of ill‐gotten bitcoins, landing themselves in prison. And the case's California prosecutor, Katie Haun, has gone on to an illustrious career as a crypto investor with Coinbase, Andreessen Horowitz, and her own Haun Ventures.

Moloch named this action the ragequit; others simply call it withdraw.

Flamingo DAO, one of the LAO DAOs formed with OpenLaw, was one of the first NFT DAOs, and its success helped spur other popular NFT DAOs like PleasrDAO and BeetsDAO.

Even after the DAO lost the auction to Citadel hedge fund titan Ken Griffin for $42.2 million, the PEOPLE token continued to have market value, as not all DAO members chose to withdraw,some because of the friction of converting their tokens into other tokens, but others because they continued to believe there was value in the group that had assembled itself on‐chain. The idea that communities such as DAOs have intrinsic value apart from the value of assets they hold becomes fundamental in our chapters on Web3 community.

Pace Gallery, one of the world's leading art galleries, launched an NFT collection called “Moon Phases” with artist Jeff Koons, which involves sending miniature sculptures of the moon literally to the moon itself, on a lunar lander. Earthbound sculptures corresponding to the miniature ones landed on the moon will then be sold with accompanying NFTs.

The science fiction author Neal Stephenson coined the term metaverse in the novel Snow Crash, 30 years before Facebook would rename itself Meta and declare its intention to occupy a digital realm of the same name. Snow Crash tells the story of Hiro, a pizza delivery boy in an anarcho‐capitalist future. A hacker in his spare time, Hiro draws a cast of computer nerds, tycoons, and mafiosos into daredevil schemes in an immersive, virtual reality, massive online multiplayer game called the Metaverse. Before nearly anyone else, Stephenson imagined that people would want to merge their physical and digital realities and dive deeper into inhabiting virtual worlds. He turned out to be right.

The Web3 business model essentially collapses the categories of company, investor, and user into a single economically aligned category called community. This is a sharp contrast from Web2, where these three groups are separate, often with adversarial economic interests.

I was able to extract the idea that they were building what some called an Internet of Value that would evolve the Internet of Communications that Web1 had built; where Web1 facilitated the global movement and exchange of information at a scale previously unimagined, Web3 had the potential to do the same for value. (It should be noted value is not the same as money, though money is a common way value is expressed.)

Plus the concept of “marketing” had a veneer of inauthenticity, especially from its context in Web2. The word reminded them of annoying ads on Facebook that no one clicks on, Instagram influencers hawking vitamin waters, exaggerated headlines and articles about the Kardashians. To these thoughtful technologists, marketing seemed more like an evil than a good, the art of using simple and deceptive language to manipulate consumers into buying products they don't need. No one likes the feeling of being marketed to; many are happy to pay subscription fees to avoid seeing advertisements.

This information enables them to construct a marketing funnel that takes potential users through the steps of discovery, engagement, use, and retention. In many cases, a Web3 marketer seeks to convert new potential users from discovery into engagement with an invitation to join a community.

“Community” in Web3 usually refers to an incentive‐aligned group of people, typically gathered on a communications channel, such as Discord or Telegram.

Communities typically share sets of values and interests beyond the mission of the project. A vibrant community can look like a digital social club where members work and play together.

The product is like a bone, the solid core of a project. But a body that's all bone and no muscle just lies on the floor. All muscle and no bone doesn't work either. To walk around the block, the body needs muscles to attach to bones and apply leverage on them. A project's success comes out of the tension between the solid bones of a high‐quality product and the marketing muscle that activates it into motion.

The marketing and product teams both need to be responsive and flexible. Marketing teams need to seek out users for the product that exists today. They also must gather data from users about their preferences and feed it back to the product team. Then the product team must iterate based on that feedback.1 Without a proper feedback loop between product and marketing, otherwise competent product and marketing teams are doomed. We still constantly ask ourselves why products succeed and fail, and we identify and test new patterns.

A good analogy comes from chemistry: an atom must have the right configuration of electrons in order to bond with another atom. In marketing we are trying to forge a bond between a product and an audience. The correct way to do this is study the target audience's “electron structure,” custom configure a message with just the right number of electrons, and deliver it over the right channel. Then the message and the audience connect, catalyzing a measurable action, such as downloading a product.

Our community marketing team reached out to existing meetup groups and organized a network of meetup group leaders to share best practices. We kept an eye out for Ethereum communities cropping up in new cities, and we launched a program to support new meetup group founders. Through small sponsorships, we ensured meetup groups always had the funds to provide beer and pizza. We circulated decks and templates with standard language about Ethereum and consistent visual design that conferred on nascent groups a sense of legitimacy. As new projects were built on Ethereum, we arranged for their creators to go on IRL roadshows to present their ideas and get feedback from the meetup groups. Group leaders could count on regular, high‐quality content, and project teams had the chance to get exposure to early product adopters.

Community members need not be developers or engineers in order to contribute to a Web3 project's success. Meme contests, for example, are an excellent tool for communities to incentivize content creation. Thousands of fans are just as (if not more) likely than a small, centralized marketing department to surface what is most funny or compelling about a project or team. Then, even better and cheaper than A/B testing, other community members can vote on the best content. The project, its team, and community are then armed to share the winning memes about the project on platforms such as Crypto Twitter, driving project discovery. In Web3, marketers need not do all the work themselves; instead, they should focus on creating the conditions, often through rewards, for others with the right skills and incentives to work alongside them to achieve their goals.

One of the best ways to evaluate Web3 platforms is to look at what developers use without being paid to do so, or which have tokenomic models that offer sustainable rewards over time. Eventually, if projects spend more to acquire a user than the value the user adds to the platform, they will run out of fuel.

The early Ethereum meetups didn't work because they offered people beer and pizza. What they really offered was community and identity.

We needed a jargon‐light way to distribute crypto tokens to music fans; our job was to message what they did rather than how they worked on a channel where the message could connect with its audience, while offering a friction‐minimizing UX for users to claim their tokens.

It pioneered a progressively decentralizing wallet that's easy to set up and takes credit card payments. Although the wallet starts out centralized and custodial as a “multi‐sig” (a multi‐signature wallet with more than one private key), the user can choose to boot Mojito out of the multi‐sig and make the wallet self‐sovereign whenever they want. As a Mojito user learns more about Web3, how they use the platform can evolve with them. Native Web3 users can also come with their own MetaMask or other Web3 wallet. Software, UX, and marketing innovations are all necessary to meet users where they are and facilitate their Web3 journeys.

Despite attracting more top‐of‐funnel token buyers than any other project I'd seen at the time, the UX of buying the actual Civil token involved too many steps for non‐Web3 users, and they fell out of the funnel (the Web3 marketing funnel is the subject of Part 3 of this book). Web3 marketers shouldn't count on an audience that's never exhibited a behavior in the past, such as buying a token, suddenly taking that action on launch day. Wherever an audience is being asked to do something new, marketers should test and optimize the funnel to make sure it's actually converting. What happens on launch day should be pretested and never a mystery.

Web3 marketing is like staking a newly planted tree. The stakes are temporary; once its roots are established, the tree should stand up on its own.

The job of a Web3 marketer is to start the flywheel of growth until a community can take over. To start spinning this flywheel for a new Web3 project, marketers first need to bootstrap demand.

he called it Pepsodent. Hopkins launched a marketing campaign that alerted people to a “film” on their teeth that, he claimed, caused decay and thus less beautiful teeth—a film that could only be cleaned off by brushing with toothpaste. Suddenly, when people ran their tongues over their teeth, they began to notice this film that had always been there, but to which they had never paid attention, much less thought of as a problem. Every time they noticed the film, this would become a trigger for them to practice a new behavior—brushing their teeth—to realize the reward of having beautiful teeth. This cycle would go on until toothbrushing became a habit for most Americans, and Pepsodent a runaway international success. Hopkins stimulated demand for a new product from zero by convincing people who had been perfectly and contently unaware of a film on their teeth that this was a problem, and Pepsodent was the solution.1

than a long list of value propositions. Marketers refining their products' key messaging should focus on the sharpest, most specific, most compelling single value proposition: the knife's edge. Differentiated

At Serotonin we often remind ourselves that a zebra in the zoo is quite different from a zebra walking down Fifth Avenue. It's the same zebra, but one is far more captivating than the other, because of our different expectations in context.

Vega Protocol, a Web3 derivatives trading platform. Vega's target audience is Web3 native DeFi users, so they hosted an event at EthCC, a popular yearly Ethereum community conference in Paris. While most DeFi startups at EthCC hosted happy hours or meetups indistinguishable from each other, Vega made its event stand out against the backdrop by inviting chess grandmaster Rustem Dautov to face off against attendees. We and the Vega team figured that the target audience of crypto traders probably enjoyed competitive strategy games like chess. At the conference, Vega was top of mind, with attendees swapping stories about how they fared against the grandmaster. By differentiating its message from its peers, Vega successfully reached its target audience.

Sometimes our clients push back when we insist they use the same key words and phrases to describe their brands in media interviews, their website copy, and speaking at events. But although they may get bored of saying the same thing over and over, each repetition likely reaches a small percentage of their overall target audience. Even if our clients are craving variety after repeating themselves 10,000 times, depending on the stage of the project, their average target audience member has probably only heard their message a maximum of two or three times. This is yet another example of thinking from the perspective of the audience, not the project.

We generally recommend that projects integrate a content management system (CMS) into their domain and publish blogs from their own domain instead of sites such as Medium or Mirror.xyz. Publishing on an external blogging platform grows that platform's domain authority—which makes the domain more likely to appear in search results—and not necessarily the domain authority of the project's website. This can, however, be onerous for small, early‐stage product and engineering teams who prefer to concentrate on building products over website content. It's not the end of the world if projects prefer to use Medium or Mirror.xyz. Both of these are standard in Web3. They should keep in mind, however, that publishing on one of these platforms doesn't necessarily refer more traffic to their blog posts. These are publishing platforms, not distribution channels. When publishing on these platforms, it's up to the marketer to earn distribution for content through social media, email, and other owned channels, just like blogging on one's own website domain.

Even if search isn't a primary discovery channel for a given product today, marketers shouldn't despair; they should still build a robust content calendar of owned content that reinforces key messages. Over time and with optimization, search can grow as a source of traffic to a product website.

When I started working at ConsenSys, I encouraged Joe Lubin to grow his own Twitter following and personal brand, and to expect these channels to grow faster than those of ConsenSys. Most of us are more interested in people than products. We connect better with an individual person telling their story.

They are expected to consistently provide their followers with value and entertainment. Accounts that simply “pump their bags,” or encourage followers to buy the tokens that they themselves hold, are less exciting than accounts that share funny memes, relevant opinions, and takes on the news of the day.

At the start of its go‐to‐market motion, every Web3 project should ask itself, What large and high‐engagement accounts on Twitter (or any other social media platform where the project's target audience lives) have any reason to help promote my project? These can be personal accounts belonging to founders, teammates, and their friends and family; the accounts of investors or backers of the project; or the personal and business accounts of other projects that are partnered or somehow aligned with the given project. Large is also relative. Not every project will have connections to accounts with 1 million or even 100,000 followers.

Marketers shouldn't ignore the power of micro‐influencers or accounts with even a few hundred followers. They should granularly list all potentially aligned accounts on their chosen platform, and organize those individuals into a channel, such as a Telegram channel, where the team regularly shares tweets from the project and asks for support in amplifying them. In Web3, this chat group is often called a supporters channel, and is a great way for an early project to efficiently share updates with its incentive‐aligned community, ask for help, and generate shares on social.

Although promotions by paid influencers are distrusted by audience members in the English‐speaking Web3 markets, they are widely accepted in the Mandarin‐, Korean‐, and Japanese‐speaking markets.

Leaning on our long‐term relationships, whenever we had an announcement or product to launch, the ConsenSys media relations team could cut through the noise and earn coverage from these journalists, who could trust (without being able to diligence the code themselves) that we wouldn't send them projects that would turn out to be scams.

They should try to state their number one key message at the start of the interview instead of saving it for later. It's hard to predict when an interview will be over, and the only way to ensure with 100% certainty that a message makes it into the interview is to state it as early and as often as possible.

It's inadvisable to send pitches to outlets and journalists unlikely to cover the story. Journalists like to see that projects have done their research and send them the types of stories they might actually cover. This helps projects foster positive long‐term relationships with journalists. The “spray and pray” approach of sending a pitch or press release to as many journalists as possible, regardless of the match between the pitch and what the journalist has covered historically, doesn't work nearly as well as doing the research and cultivating long‐term, mutually beneficial relationships.

The more a marketer speaks with a journalist, the more opportunity they have to learn from the journalist what types of stories they would like to cover, allowing them to further refine and customize their pitches. Furthermore, the project stays top‐of‐mind for the journalist, who may proactively approach the project in the future with their own story ideas. Marketers should offer their project leads to journalists as experts in their fields. Experts can help journalists by adding commentary to stories, even if the subject of the story is another company in the industry. If project leads are notable experts on hot topics of the moment, marketers should reach out to journalists to proactively offer them up as sources for commentary.

recap, the goal of discovery is to reach a target audience with a brand message. If the brand message is effective, it sends the potential user into the next step of the marketing funnel: engagement. Discovery channels are all the channels where a potential user might first encounter a brand. The most common in Web3 are search, social media, earned media, and events. Then, depending on the channel where the potential user first discovers the brand message, engagement can take place on a variety of channels.

Sometimes this means finding alternative A/B testing and analytics tools, such as Matomo, which offer some data while respecting user privacy.

Wall of Trophies The wall of trophies tactic pairs well with the Chainlink strategy. As early as possible, projects should strive to attract users who resemble the users in the broader audience they want to target. They should broadcast these partnerships using the Chainlink strategy, harnessing them to drive top‐of‐funnel discovery on search and social, and also showcase their partners' logos prominently on their websites, sometimes even in the precious hero section near the primary CTA. Website visitors who see the names of prominent users—perhaps companies just like theirs, or larger and more notable ones, or well‐known individuals who use the product—will be less skeptical and more likely to take the CTA.

If a project sees that its competitors are already using a tool, this can be even more compelling, because it doesn't want to miss out on an advantage.

Instant Incumbency

If a project is competing with larger, more established incumbents or institutions, it helps to look legitimate. That means adopting the visual and verbal style of more established competitors into their brand look and feel, perhaps with a modern touch unique to the project's new brand that helps it stand out against the background of what the audience expects.

For example, Friends With Benefits is a token‐gated community on Discord that requires 75 FWB fungible tokens in a Web3 wallet to join.

The marketing team should set objectives and key results (OKRs) for content performance, not focused on publishing a certain amount of content per time period, but on the outcomes produced by the content (for greater detail, see Chapter 8, “Set Key Metrics”). A few examples of outcomes content can produce are: an x% increase in website traffic, y number of social media engagements on a post, or driving z number of qualified leads into an email capture. The content itself, whether it's in the form of social posts, blogs, op‐eds, industry reports, or event presentations, should be closely tailored to fit the interests of its target audience and reiterate key brand messaging.

Content and email newsletters don't always need to convert users to using a specific product; they can be helpful for building a store of goodwill that can later be used toward converting users.