In the cold winter, how should we do Web3 marketing?

Written by: Alex Topchishvili, Marketing Director at CoinList

Compiled by: Linda, Web3 MKT

Introduction:

In a bear market, marketing budgets for projects decrease, and user engagement willingness also declines. Many friends in the Web3 market have expressed the view that "it's hard to do marketing in a bear market."

But is that really the case? In a bull market, user enthusiasm is high, but the marketing competition will be even greater. Although budgets decrease in a bear market, there are still many resources to leverage, giving you the opportunity to stand out in the next bull market.

The author of this content is the Marketing Director at CoinList, who analyzes how to effectively market during a bear market based on personal experience.
In 2022, the crypto industry no longer had a market cap of $2 trillion, leading to a lot of discussions around Web3.

For months, as the crypto market faced a winter, marketers (and their budgets) have felt the pressure.
Global Web3 projects are in a relatively low emotional state, and marketers are waiting for the market to warm up to conduct more marketing.
But based on my experience, this is a mistake.

The bear market provides a great marketing opportunity for three main reasons:

It is much more cost-effective

There is much less noise to filter out

It is an investment that can generate excess growth and returns during the next bull market

In this article, I will introduce a growth framework for marketing during a bear market and discuss how emerging Web3 projects should allocate their limited marketing resources.

1: Define Your Growth Metrics

Bull markets and concepts are not static; using terms like "Protocol" and "DAO" cannot long-term stimulate user demand for your product or reduce developers' workload. Therefore, before considering growth, it is particularly important to understand the specific metrics for growth for different projects.

While each project has its unique definition of growth, some common Web3 growth metrics can be categorized as follows:

1. L1/L2 Protocols: Number of independent contributing developers, number of active wallets, number of interactions, number and scale of transactions
2. DeFi: Total Value Locked (TVL), number of active wallets, number of interactions
3. Gaming: Number of active players, transaction volume per user, number of guild partners
4. Market/Exchanges: Monthly active users, number of listed tokens, number of transactions, total transaction volume
5. SaaS: Revenue per customer, Customer Acquisition Cost (CAC), customer churn rate

Defining success metrics is a prerequisite for exploring growth strategies, formulating strategies, and finding tools, just like achieving product-market fit.

2: Leverage Existing Resources to Drive Growth

Even in the crypto winter when marketing budgets are cut, many marketers in Web3 overlook one of their most important available resources: existing assets of the business.

Among all the existing assets that Web3 startups possess, the following three are the most important:

• Core Team: Your team is the most valuable asset in marketing. When you launch new products, acquire new customers, or create content, each team member should be on the front lines, helping the team appropriately share and distribute project information within their personal social networks—especially on Twitter.
• Users: One of the biggest challenges for any Web3 marketer is the lack of case studies and customer success stories. If you have satisfied customers, you can drive your marketing by creating engaging case studies that serve as effective proof to convert potential customers into actual customers.
• SEO: Everyone has websites and blogs, but very few Web3 marketers invest the effort to make their websites and apps search-friendly. To ensure the integrated effect of any marketing campaign, optimize your website for proper indexing and user-friendliness. This will positively impact your organic search traffic. Optimize your search target keywords during the low competition of the bear market and reap the benefits in the next bull market.

3: User Acquisition: Double Down on Web3 Native Growth Channels and Cut the Rest

User acquisition in Web3 can be a bit chaotic, especially in a bear market.

Too many well-funded teams are burning VC money, but their strategies neither reach the target audience nor provide ROI—such as funding luxurious conferences and dinners around the world, sponsoring celebrities, and paying exorbitant fees to crypto influencers and Web2 ad networks (FB, Google, Reddit, TikTok, Quora, etc.).

Attributing return on investment for marketing methods like crypto influencers and conferences is particularly difficult, and if ROI cannot be measured correctly, these may not be worth pursuing in a bear market.

Here are two Web3 user acquisition strategies that, if executed well, can become a great focus area during market downturns.
1. Airdrops
A popular user acquisition method in Web3 is token airdrops. Projects airdrop (or distribute) free tokens to crypto wallet addresses of users who have met certain prerequisites or completed specific tasks using the protocol.

Assuming you have carefully considered the tokenomics and the potential utility of the tokens, and thoughtfully identified which users can receive the airdrop, you can attract high-quality users from day one and reward them as users and community members, fostering an active and united user base for the project.

While there have been several successful airdrops (e.g., Uniswap, ENS), airdrops also have their flaws and risks. Since airdrops occur on-chain, projects have almost no reliable way to assess the on-chain reputation of recipients.

This leads to two issues:

1. Airdrops to pure opportunists who game the system for excess airdrop allocations
2. Inability to involve users who have not participated in similar airdrops or wish to contribute to the protocol

If there isn't enough "buy-in" from token recipients or widespread trust in the protocol, tokens are often sold off immediately, leading to price crashes and harming the entire ecosystem. Poor examples of airdrops include Optimism and Ribbon Finance.

To make airdrops work in a bear market, launching token airdrops requires confirming the on-chain reputation of users and focusing on those with a reliable track record of contributing to the protocol, rather than airdropping to speculative users who will sell off tokens at the first opportunity.

2. Bounties and Credentials

Another increasingly popular Web3 native user acquisition strategy is to initiate incentive reward campaigns on bounty platforms, rewarding users with cryptocurrency when they complete specific on-chain actions (such as trading, staking, swapping, lending, following on social media, etc.).
For new users, this is a way to earn cryptocurrency while learning and building credibility to become contributors to emerging projects.

For Web3 projects, this is a way to identify and acquire quality contributors based on their proofs and value-added activities.
Unlike paying Facebook or Google to capture any minimal search traffic left in a bear market, you pay active users who have previously demonstrated value-added activities or positive on-chain behavior, which is more likely to maintain an engaged audience and contribute to your community. Some of these reward platforms include:
Flipside Crypto
Layer3
Project Galaxy
Rabbithole
Quest3
DappBack
Crew3
CoinList Karma

4: Invest in Content → Reduce Competition and Gain More Attention for Your Content

New narratives can scare away users. If something evokes fear, uncertainty, and doubt (FUD), most people will avoid it altogether.
The antidote to this fear is education.

As marketers in an industry plagued by various scams and dark histories, we must help our users understand Web3 products, providing them with real value through quality content and insights. There is no better or more effective time than the crypto winter to educate. Creating high-quality content relevant to your target audience during a bear market will help your project attract organic traffic, build trust, enhance your SEO, and establish brand value.

In a bull market, the sheer volume of content produced and shared makes it difficult for your content to be unique and stand out. However, in a bear market, content production is much lower, making it easier to attract attention to your content and establish your project as the preferred product and thought leader in the niche.

Remember—Google considers the timeliness of content when deciding which search results to provide. Content published during the last bull market may not be presented again. Regardless of what happens in the industry or how much value is wiped out, long-term crypto users will still check Twitter daily and refresh their alerts dozens of times, providing ample opportunities for your content to be showcased.
Investing in content during a bear market will yield significant dividends in the next bull market, as people will always remember which companies struggled during the bear market and which projects remained active and in the spotlight. Web3 may never be smaller than it is today, and your competition will never be less than it is today.

5: Community is King: Build a Community with a Specific Purpose

In Web2, the primary goal of go-to-market is your customers, usually acquired through sales and marketing efforts.
In Web3, the marketing goals will not only include customers/users but also developers, investors, and partners. Since Web3 projects are "community-owned," not just "community-driven," the distinction between owners, shareholders, and users is often blurred, making it even more important to define your goals clearly.

Unlike Web2, in Web3, goals, community, and product are key to leading a project's go-to-market. Often, a project's growth is not due to users flocking to existing products but because of the ideas and perceptions embodied by its community. The community helps define and shape the product.

Several examples in this regard include:

• Friends With Benefits, a social DAO that started as a Discord group with token access;
• Loot, a game that began with content and then shifted to gameplay;
• Smoothie, a discover-to-earn rewards platform that initially focused solely on content and community around discovering Web3 startups.

Some tips for building a community during a bear market:

1. Go where Web3 users are: The Web3 community has already identified their preferred platforms, so building a community means meeting them where they are. Twitter and Telegram are essential tools for making announcements and hosting public discussions, but Discord has become the primary platform of choice for project leaders seeking maximum flexibility in community management.
2. Be clear about your purpose and intent: When newcomers arrive, they should be able to easily find and understand the purpose of your organization (why you exist) by browsing pinned posts and channel titles. Include relevant links to your website, project documentation, or introductory blog posts or videos so that people have the opportunity to learn as much as possible.
3. Set clear boundaries: Once a community recognizes a certain culture, it can be difficult to change, so it is essential to set clear boundaries for acceptable behavior from the start. Clearly define which behaviors may lead to bans and address violations quickly and consistently.

Cross-promote with other communities: Build partnerships and collaborations that facilitate cross-promotion among Web3 communities. In a bear market, good news around collaboration is scarce, so every relatively positive announcement is amplified. Whether through project collaborations, joint AMAs, or co-content plans, when you have the opportunity to cross-promote and leverage your partner's marketing influence, make sure to take advantage of it!

Leverage your community: Whether it's expanding your content to attract a larger audience, providing feedback or reviews, testing new features before they go live, creating analytical tools, or completing bounty programs—engage and mobilize the community as much as possible, with incentives being as clear as possible.
As Web3 matures in this bear market, the demand for understanding customers, growth drivers, and actual growth metrics will also become increasingly sophisticated.
I look forward to seeing various new growth models emerge in Web3 and the projects that utilize them making progress.