Contextual Advertising

How to Advertise to The Cryptocurrency Community

Picture of Jordon Ahosaari

by Jordon Ahosaari on November 5, 2019 - 12 minute read

how_to_advertise_to_cryptocurrency_audiences_191030

Regardless of your target audience, navigating the world of digital advertising and contextual advertising networks is a complex undertaking.

For marketing professionals, determining the components of an effective ad campaign is a comprehensive process involving several moving parts. Despite these inherent challenges, digital ad spending continues to increase.

According to the IAB and PwC, digital ad spend hit $107.5 billion in 2018, representing an annual growth rate of 21.8%. Companies old and new clearly see it's value.

Despite the popularity and growth of this advertising medium, some audiences remain immune to conventional marketing tactics. Cryptocurrency audiences, in particular, have become known for their aversion to traditional advertising.

These tech-savvy, educated early-adopters rely on proven results and remain leery of glossy sales literature. As such, any attempt to reach this demographic requires a thorough understanding of the crypto industry, both past and present.

For those marketers that can successfully breakthrough, however, a robust and rapidly evolving industry awaits.

According to recent Statista figures, there are approximately 40 million unique blockchain wallet users worldwide, a 25% increase since the end of 2018. These wallets, which enable the use of cryptocurrency, serve individual users within the ecosystem.

The benefits here are clear: learn how to sell to this audience effectively, and put yourself ahead of the competition. 

blockchain wallets worldwide

Source: Number of Blockchain Wallet Users Worldwide

The Attributes of Crypto Audiences

While there are many apparent reasons for the ad aversion shown by crypto audiences, delving a bit deeper uncovers valuable insights. By assessing the attributes of typical crypto users, marketers can implement better-performing ad campaigns. That is to say, there's a huge opportunity here.

Crypto Audiences Are Tech-Savvy

As mentioned, crypto audiences are naturally tech-savvy. Marketers should expect this level of tech awareness given the complexity of industry projects and their relatively recent emergence.

As innovators and early adopters by default, crypto audiences often have a connection to scientific disciplines, prize new possibilities, and rely on their peers for valuable thought leadership.

By generating thoughtful discussion and displaying technical competency, marketers can earn the trust of this community-minded group.

interactive design foundation

Source: Interactive Design Foundation

Crypto Audiences Are Ad-Averse

Although it’s evident that crypto audiences are resistant to long-standing marketing tactics, past industry trends can help marketers and advertisers understand this dynamic. The prolific growth of initial coin offerings (ICOs) and their subsequent collapse is one such influential trend. As the price of bitcoin and other cryptocurrencies soared throughout 2017, countless projects began issuing tokens to raise funds.

However, what was once a booming issuance model quickly fell apart in the face of countless scams and plummeting cryptocurrency prices. In a report reviewing 141 ICOs, Ernst and Young found that 86% of tokens had fallen below their initial list price after only one year. This outcome erased billions of dollars across investment portfolios and undoubtedly contributed to the ad aversion we see today.

Initial coin offerings

Source: EY Study: Initial Coin Offerings - One Year Later

Crypto Audiences Demand Value

The need for viable use cases is closely related to the industry’s experience with ICOs and their resulting utility tokens. Amidst the hype of earlier years, many projects began exploring use cases that were ill-suited to crypto and blockchain infrastructure. The eventual failure of these projects has only heightened crypto audience scrutiny.

Today, this group prizes projects exploring viable, value-added use cases.

Marketers must show crypto audiences that their project solves a real-world problem for which cryptocurrency is the answer. This is a crucial precursor to getting results from your next campaign.

Crypto Audiences Embrace Decentralization

Around the globe, society has become reliant on centralized financial institutions. These long-standing entities facilitate the majority of economic activity. However, following the great recession of 2009, many began to look for ways to put power back in the hands of consumers.

Bitcoin was the first cryptocurrency to emerge in the wake of the financial crisis, touting a distributed vision of the future. Since then, crypto has come to represent a new world order, and advertisers need to adjust accordingly. Any mention of centralization, hierarchy, or intermediaries in advertising campaigns is likely to spook crypto enthusiasts.

Messaging in the Cryptocurrency Ecosystem

The cryptocurrency ecosystem relies on a vast, complex network of infrastructure.

Each component of this system contributes to its ongoing functionality. For those operating in the industry, each of these components is distinctly different. However, for advertisers and marketers less familiar with the space, understanding these unique market segments may require some research.

By displaying an understanding of each component, marketers can deliver targeted messaging that catches the attention of crypto audiences.

conceptual mapping of monetary flows

Source: Cambridge Centre for Alternative Finance

Cryptocurrency Exchanges

Because the cryptocurrency ecosystem relies on a decentralized framework, exchanges remain largely disjointed.

Unlike the centralized stock exchanges found in conventional markets, crypto exchanges transcend borders and lack intermediary oversight. As a result, poor security is often the most commonly voiced criticism, and for a good reason. In 2018 alone, a record $865 million was stolen from six exchanges as a result of hacks. This amount was more than double that lost in 2017.

For advertisers looking to promote a crypto exchange, safety and security must dominate the narrative. Information regarding both hardware and software security features, and reinforcing compliance standards, will help establish trust with crypto audiences.

cryptocurrency hacks

 

Cryptocurrency Mining

Cryptocurrency mining refers to the validation process on blockchain networks. Every public blockchain network employs some form of consensus mechanism to validate transactions. Without the individuals and companies mining cryptocurrency, blockchain networks would stop functioning.

In recent years, some consensus mechanisms have begun to garner negative press for their environmental impact resulting from intensive electricity use. In response, many projects have started exploring more environmentally friendly alternatives. If possible, marketers should highlight the environmentally friendly features of a project to counter negative perceptions.

Initial Coin Offering (ICO)

As mentioned, ICOs were once the gold standard of token issuance. However, scams and a declining crypto market eventually took their toll, dramatically reducing the popularity of this crowdfunding model. However, past events aside, some projects have found success using this approach to fundraising.

Understandably, any project that decides to conduct an ICO must establish trust with crypto audiences through transparency. Marketing efforts should acknowledge the mistakes of the past to avoid being completely ignored by crypto audiences.

Initial Exchange Offering (IEO)

To many, IEOs represent a more legitimate way to raise funds through utility token issuance. In contrast to company-conducted ICOs, IEOs are handled by an existing exchange platform.

Perhaps most importantly, this arrangement places an independent entity between projects and their fundraising efforts. Further, since the token is automatically listed on the issuing exchange, investors also benefit from instant liquidity. The near-instant sell-out of the BitTorrent and Fetch.AI IEOs highlight the growing popularity of this approach.

For marketers promoting an IEO, it’s crucial to highlight the benefits of this issuance model in comparison to others. As a relatively new crowdfunding mechanism, IEOs may require further explanation and clear messaging.

total funds raised during 2019

Source: Inwara - Initial Exchange Offering Report

Security Token Offering (STO)

Security tokens represent the digital securitization of and underlying asset. Virtually anything of value can be represented using a security token. From private equity instruments and artwork to real estate, STOs are transforming the way people invest. Security tokens also enable highly efficient fractional ownership given the ease with which a token can be bought, sold, and transferred.

For those looking to promote an STO expertly, assurances must be made that the underlying asset is legitimate, and the securitization framework is secure. Token custody stipulations, liquidity, and potential returns are all critical pieces of information for crypto audiences.

Stablecoins

Stablecoins have quickly become the preferred crypto option for conventional financial institutions and large organizations such as Facebook and JP Morgan.

Despite the many benefits of a global digital currency, continuing price volatility has long been a hurdle to widespread crypto adoption. As a result, countless projects have begun exploring ways to make crypto a better store of value while maintaining its decentralized perks. Backed by an underlying asset, such as the U.S. dollar or gold, stablecoins aim to strike this balance.

For those marketing a stablecoin project, conveying an understanding of the underlying asset correlation is essential. Crypto audiences have likely heard of stablecoins, but many iterations exist, requiring further explanation.

Having an understanding of these concepts is important when positioning your product or service to crypto audiences, especially in advertising. Choosing the right publisher placements for your campaign can give you a huge advantage in how your advertising is perceived as well as how effectively it drives action. Advertising effectiveness across publishers can vary widely depending on your offer.

Creating a Marketing Plan

Although a thorough understanding of the crypto ecosystem enables targeted messaging, it’s also essential to choose effective advertising channels and marketing strategies. As shown, the crypto industry encompasses a vast array of projects that span countless use cases. Each of these projects requires a custom approach to achieve optimal results.

As marketing professionals know, determining how to deploy limited resources is essential. For many companies, especially startups, time and money are tight. As such, achieving a high return on advertising dollars spent is critical to future growth.

Advertising Channels

Advertising on appropriate publisher platforms is crucial when attempting to reach crypto audiences. Although there are several paid advertising platforms to choose from, many have a complicated relationship with the crypto and blockchain industry.

Facebook, Google, Snapchat, and Twitter have all implemented varying degrees of blockchain and crypto ad restrictions in recent years. And despite an ongoing easing of such restrictions, crypto companies have come to rely on alternative platforms.

Bitcointalk

As one of the most active forums in the crypto community, Bitcointalk is an invaluable resource. According to forum statistics, the platform currently boasts 2.66 million users with almost 400 new registrations every day. For advertisers looking to get their project in front of a massive crypto audience, Bitcointalk is a highly respected platform offering auctioned advertising space.

crypto audiences

Source: Crypto Audiences

CoinMarketCap

CoinMarketCap is one of the most trusted resources in the crypto community. The website offers several technical tools, resources, and informative blog posts. For advertisers looking to reach a large crypto user-base, the site provides highly visible advertising space on a reputable platform. CoinMarketCap is also available through BuySellAds, an advertising marketplace we’ll dive into next.

top 100 cryptocurrencies

Source: CoinMarketCap

BuySellAds

BuySellAds (BSA) builds powerful revenue technology for publishers and connects marketers with qualified, valuable audiences at scale. The BSA platform offers a dedicated cryptocurrency network referred to as Coin.Network (as well as a strong focus in verticals like design and development) that enables immediate access to a robust network of curated crypto-focused publishers. As mentioned, marketers can run ads directly on crypto websites like CoinMarketCap through the BSA platform.

buysellads

Marketing Strategies

In addition to choosing effective marketing channels, marketers can gain more exposure by engaging with crypto audiences both directly and indirectly. This process might involve ongoing participation in community forums like Quora and Reddit, direct messaging on platforms like Telegram, or establishing a bug bounty program that aims to engage tech-savvy developers.

ico marketing strategies

Source: CryptoAudiences

Community Forums

Community forums such as Quora and Reddit can be extremely valuable for marketers looking to establish themselves as thought leaders in the crypto community. According to Alexa, Reddit is the sixth-most-popular site in the United States, providing ample exposure to a vast user base. By partaking in forum discussions, marketing teams can bring further legitimacy to their projects.

reddit cryptocurrency

Source: Reddit

Telegram

Due to its enhanced privacy and security features, Telegram has become the go-to platform for crypto audiences. The popular discussion channel feature allows startups to set up group discussions that anyone can join using a public link. By engaging with crypto audiences directly, marketers can build brand awareness while establishing a sense of community.

Bug Bounty Programs

Bug bounty programs have become a useful tool for generating project awareness. From small startups to large corporations, many companies have begun to rely on talented developers around the globe. Sometimes referred to as “white hat hackers” these tech-savvy coders are hired to expose potential vulnerabilities before malicious hackers do. By directly involving the tech community in projects, marketers can build a bigger following around their platform while correcting code deficiencies.

These are just a few of the potential strategies to utilize when marketing your product or service. Whether community forums, instant messaging, paid placements, or other forms of promotion, understanding what makes up this valuable audience and what they are sensitive to is crucial when crafting your messaging and communicating about your product or service. Cryptocurrency audiences are not going to respond to in-your-face, annoying advertising that comes off dishonest or intrusive. 

The Future of Cryptocurrency Audiences

Although crypto audiences remain suspicious of conventional advertising, marketers can still employ several effective strategies. Those in the cryptocurrency industry are more likely to engage with advertising from contextual advertising networks that display contextualized messaging and is relevant to what they're viewing, is honest, and doesn't utilize forms of tracking. This messaging must take into account crypto market segments and the events that continue to shape the ecosystem.

Despite easing or eliminating prior ad restrictions, paid platforms like Facebook and Google remain secondary to several alternatives. Cryptocurrency audiences have come to rely on community-based forums and direct communication to establish trust with projects and their founding teams. As such, marketers would be well-served to embrace these channels while leveraging the ethos of decentralization. 

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