Blockchain marketing strategy (also called crypto marketing strategy) is a new practice all B2B marketers will need to understand in the next two years. If done properly, marketing efforts around blockchain will fundamentally shift your customers' relationships with your brand.
By Brian BloomKing, March 9th, 2022
So, what exactly is Blockchain Technology? In its simplest form, the blockchain comprises a group of computers and software spread out across the globe (distributed) on computers owned by both individuals on companies. The software on each one talks to all the other nodes to coordinate transactions and keep an immutable record of a given transaction.
All the computers on the blockchain act as one. This makes it incredibly difficult to hack the blockchain at this level. Unlike information stored at Amazon.com or your bank, which is centralized, information stored on a blockchain project can’t be traced to any particular location. Furthermore, a blockchain space is neither owned nor controlled by a single entity, so even the best hackers can't crack blockchain tech (they tend to have more success cracking smart contracts that sit on top of the blockchain).
Blockchain is a peer-to-peer (remember Napster?) digital record of add-only transactions, meaning a block/entry can’t be edited or removed. These digital records, also known as blocks, are connected to a single chain. A ‘chain’ is merely a metaphor.
What is happening is that the transactions are stored on computers spread around the world, called nodes, whose validity to store transactional ‘block’ data is constantly validated using different software-based approaches, called Proof-of-Work (there are other validation methods such as Proof-of-Peer you can research if curious).
Proof-of-Work is the model for validating a node on the blockchain that is consuming excessive energy right now. It requires nodes to complete complicated mathematical tasks, which are CPU-intensive. As a result, large organizations like Ethereum are switching to the more power-friendly Proof-of-stake, which only requires that the node stake coins, i.e., set them aside, be randomly selected as a validator.
Since the validation is decentralized, it is nearly impossible for any erroneous transaction or interference from a single computer. A cryptographic hash is created when a new transaction is entered into the Blockchain. The chain is unbreakable because the record is permanent immediately after entering a new trade.
It looks something like this (thanks to Euromoney Learning):
The key point for marketers is that a transaction recorded on the blockchain is not only for validating ownership of a crypto coin. Anything of value (like the utility your product provides) can be tokenized in the form of an NFT and recorded on the blockchain, where ownership of that value is immutable.
For example, as a growth-driven crypto project, your customers may own an NFT you mint and sell them (or give away), recorded on the blockchain, whose value could be:
To stay ahead of the curve, marketers need to begin exploring ways they can launch a crypto marketing pilot. Cryptocurrencies are becoming more and more popular, so marketers need to start thinking about how they can deploy marketing strategies around blockchain. Here are some ideas for pilot cryptocurrency projects you can get started with today.
The token can be sold to early adopters or given away for free to influencers. The validated owner of the token may hold it and watch its value increase or sell it for whatever the market will bear.
The likely scenario is that once an influencer owns a token based on your company's utility, they will work as an advocate for your products to grow your company's value and, with it, the token.
Influencers can also recruit others to join a crypto industry-based group on Discord (or any community platform) to discuss industry issues, socialize, and engage with your brand. Because it requires a token to participate, participation often drives up the value of the NFTs you're offering.
Marketing platforms of any kind are database-driven systems recording information such as target audience, transactions, contracts, clicks, and other data exchanged between multiple participants, all across different systems of intermediaries and different technologies. Blockchain could be a single source of truth for digital marketing platforms, as it's impossible to manipulate. Decentralized, transparent, immutable, and automated, it's a formidable tool that can and should transform the digital ad industry.
For example, when you click on an ad, the advertiser wants to ensure that you actually saw their ad and intended to click on it. Blockchain can help by providing a new way for advertisers to validate transactions. This means that clicks can be verified as legitimate, eliminating the chances of fraud. In addition, once a transaction is recorded and confirmed, it cannot be altered, which ensures trust and makes reporting/audits open and transparent.
Using third-party platforms raises the risk of data loss, fraud, and theft due to cybersecurity breaches and human errors. As digital marketing becomes more and more common, the need for security increases. Blockchain marketing offers a solution to many security issues businesses face today. Each transaction is verified and recorded on a public ledger with a blockchain-based solution.
This means that marketers can ensure that their campaign data are secure and tamper-proof. In addition, blockchain can also be used to track customer interactions and measure the success of marketing campaigns. This data is stored in an encrypted format, making it difficult for hackers to access. As a result, blockchain marketing provides a high level of security for businesses and their customers.
If it is possible to remove the intermediaries like Google, Instagram and Facebook, marketers will make more money. By using blockchain technology, businesses can directly connect with their customers and vice versa. As a result, businesses can focus on creating valuable content to share directly with their target audience.
For example, brands can use digital tokens to reward customers for completing certain tasks, such as watching a video, sharing an article, or completing a survey. These tokens can be redeemed for product discounts, super trials, or other rewards.
In addition, blockchain marketing can provide brands with valuable data about their customers, which can be used to tailor future campaigns. Blockchain projects allow businesses to track customer engagement in real-time, making it easier to identify which content/campaign combos are most effective and adjust their marketing strategies accordingly.
As a result, crypto marketing strategies have the potential to revolutionize the way businesses operate by streamlining the marketing process and increasing transparency.
Blockchains support flexible ways to validate and record data. Smart contracts enforce the rules for what goes on block and when. Smart contracts are the most common way to enforce rules around what transactions are recorded on the blockchain, by whom, when and at what value. Smart contracts are programmatic rules stored on a blockchain that run when predetermined conditions are met.
They are typically used to automate an agreement's execution so that all participants can be immediately certain of the outcome without any intermediary's involvement or time loss. Smart contracts don't rely on all the parties to 'trust' one another, so they are called trustless.
Because all the rules are predetermined and enforced by the contract, no one party can 'renege' and alter the agreement after it's been activated. The transactions in a smart contract are processed by the blockchain, which means they can be sent automatically without a third party.
NFTs and blockchain marketing strategies open up new possibilities for rewarding and incenting marketing behaviors. With NFTs you can package up anything of value and reward it as a token for certain behaviors.
And because they're built on blockchain technology, NFTs are highly secure and tamper-resistant. That makes them an ideal way to store and transfer the value contained in the NFT. With a Starbucks gift card, you can only use it at Starbucks. With an NFT, you can use it for its value or sell it to someone else. As a marketer, you can airdrop additional NFTs as consumers accumulate rewards or engage in desirable behaviors. As a result, they offer a powerful new tool for businesses looking to take their marketing efforts to the next level.
Blockchain is undeniably a powerful and reliable technology. It opens up unlimited opportunities for creative marketers who aren't afraid to try it. If used effectively, Blockchain can revolutionize digital marketing.
This crypto space has already been widely embraced on the consumer side. Certainly NFTs are leading the way from a publicity standpoint. But as more consumers open wallets, they will populate those wallets with brand-driven NFTs, too. Coinbase's Superbowl ad propelled their wallet app from #186 to #2 in the App Store. Reddit is onboarding millions of new wallets by switching its community rewards programs to crypto for its 400 million active users.
Now would be a good time to embrace a cryptocurrency marketing strategy with a pilot project.
Once you decide on a program that might work for you, search Google and see if someone has already built a platform that can help you implement it. Since this is all so new for B2B marketers, you may have to build your project with some outside help. The best approach is to pick an outside marketing agency to help build and promote your project.
Here at The BloomKing Agency, we offer quality advice and consultative services to help marketers create working strategies. Blockchain technology is the future for all businesses, including marketing.
Be the first one in your industry to build an exclusive community of token holders around the problems your products solve. And with the incentive to increase the value of their tokens. You can do this today. We can help.