July 5, 2023

Your Web3 game needs a plan

Brands are getting into Web3 to capitalize on the hype and reach new audiences – but the fizz can fall flat. Looking at those who shine, and those who shock, yields some lessons.

From the headlines in the business pages, you might think that consumers were falling over themselves to get into Web3… whatever that is. Brands from GAP to Gucci have launched NFT initiatives, to much fanfare, but what have they achieved? Sometimes these efforts really do pay off – driving audience engagement and even attracting new loyal customers. But sometimes they backfire, and instead of being a Zeitgeist hero, you’re the embodiment of cringe. What makes the difference?

First, ask why you’re here.

Everything starts with your brand strategy. Don’t throw your resources behind a push into the metaverse, or anywhere else, without thinking hard about who you are as a company, who your audience is, what they want from you, and how this big idea can help you deliver it.

That means starting with your values, your broader marketing strategy, and your audience; and then considering the specific goals you want to pursue through your Web3 initiative. There has to be a reason, and a solid connection to your broader strategy.

Audience alignment can be particularly tricky. The crypto crowd is already sold on Web3, but the public doesn’t care, or are actively hostile (as in gaming). You need to think beyond “we want to bring in new customers”. Who are you appealing to, and is there a good brand fit?

Reddit’s experience shows how difficult this path can be. With a strong Web3 community already making its home on the platform, NFT mascots supported by cross-chain-compatible wallets seemed like a great way to offer crypto Redditors a way to show their crypto cred and build loyalty. But the announcement was still met with anger as well as excitement, which may be why their later effort was carefully branded as “collectible avatars” rather than NFTs.

Even if your audience is already committed to Web3 – maybe especially then – you need to be sure you understand what that means to them (and include Web3 natives in your team). Things are a little different here. The appeal of Web3 may not be obvious to outsiders; it’s about the underlying values of community, authenticity, transparency, and a particular kind of democracy. Top-down thinking won’t work. Think of yourself as a guest on this turf, and learn the rules of behavior.

The golden rule: no cash grabs!

Bearing in mind this democratic spirit, what are you offering your customers? Forget any thought of spinning pixels into gold – although admittedly, that worked for Tiffany. Post-NFT hype, though, the focus is on creating real value. Your audience might be excited about phygital goods, like those NFTiffs (anything that connects their tokens to exclusive products in the real world), or collectibles that unlock access to unique events and rewards. Or you might use NFTs as a way to bring your customers into the creative fold.

Co-creation is a big deal here: find a way to be part of the power handover that sees customers as more than just their wallets. For example, Nike’s .SWOOSH platform invites customers to design their own virtual sneakers, which can then be sold. This creates an economic incentive, but more than that, it brings customers into the creative fold and makes them part of designing the products they love. In terms of reinforcing customer loyalty and excitement, that’s far more powerful than money. (And note how the .SWOOSH tagline captures the mood: “It’s not us. It’s you.”)

Starbucks opted for a straightforward blockchain-backed reward system, effectively using Web3 infrastructure to expand its existing loyalty program and build engagement. Points can be earned by participating in quizzes and the like, not just by buying drinks; and can be redeemed for exclusive experiences, not just for, well, more drinks.  

And don’t forget that Web3 is not all about NFTs. Miller Lite focused on experience with their Decentraland event, which successfully drew audiences away from the Superbowl and disseminated branded virtual goods that could be seen in the space long after. In keeping with their brand values, it was all about community and social connection. The event landed perfectly, keeping visitors engaged for an average of 20 minutes and racking up Decentraland records.

Most of all, don’t mess up.

An unfortunately large proportion of press coverage of Web3 efforts is devoted to embarrassing failure, controversies and backlash. So the biggest lesson perhaps is: read the room. Be sure you know who your audience is, and what they want. Sure, you want to be a pioneer. But you don’t want to be a cautionary tale.  

Porsche’s NFT mint is such an example. Their digital 911s were overpriced, badly timed and terribly executed. The exercise has already spawned countlesswhat not to doarticles (many focusing on the lack of Web3 ethos and engagement behind the effort) – making them entirely the wrong kind of case study.

But let’s close with a study in those who just do it right. Yes, we’re coming back to Nike, because long before .SWOOSH, they were leading the way in digital engagement, and their Web3 efforts have come as a natural extension of that. For years, the company has been investing heavily in digital initiatives that deliver unique value (such as celebrity workouts and curated looks, through a suite of Nike apps) and build customer engagement. Since it was already partnering with gaming platforms such as Roblox and Fortnite to make inroads into the metaverse, buying digital wearables firm RTFKT – and launching the phygital collection CryptoKicks – made perfect sense. At that point, the user-designed sneaker NFTs were all but inevitable.

Looking at this trail of cascading successes provides the clearest possible lesson in how to win at Web3. You don’t just jump in because all the cool kids are doing it. You look at how you can create new value for your customers, and how the new technologies can help. And then you build on top of everything you have already been doing. If you already know who you are, and who your audience is, you’ll be ready to thrive in the decentralized web. If you don’t – well, call us. We’ll know what to do.

Photo credits:

Photo 1 by Joseph Ruwa on Freepik
Photo 2 by Freepik

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