Advanced Crypto Marketing Course: 10 Principles
Disclaimer!
Why is it that a meme coin with no utility can reach $89,000,000+ market cap, and other legitimate web3 projects that improve people’s lives can’t even reach $1 million?
Why is it that Pepsi always wins the blind taste tests against Coke, yet when you and I go to buy cola, we buy Coca cola…?
What is the real key to building a strong community (99% in the industry get this wrong)?
What made you win in web2, that won’t make you win in web3?
Why do monkeys kill their own babies?
And most importantly.. Why did Dan Bilzerian say that fame is 20x more powerful than money when it comes to getting laid?
These are some of the important questions that if you understand them, will improve your probability of success in web3.
Before we get started, here’s my hidden agenda: I want you to use this stuff, make money with it, then use some of that money to pay me for consulting & advice.
In order to accomplish that we first have to establish a base-layer understanding of what drives human behavior. At the end of the day that is the number one thing marketers need to know. Once you understand those fundamental principles you won’t have to use formulas, templates, or even look at what others are doing in order to do effective marketing. You will be fully capable of taking a blank canvas and creating meaningful crypto marketing that is not only effective, but also doesn’t rely on cheap tactics that damage your brand (there’s a lot of this going on in the industry).
Human behavioral biology
Most of the web3 marketing content I see out there lacks a basic understanding of what makes marketing work, or not work. They immediately resort to talking about tactics. They say “you should use NFTs in your marketing”, or “use influencer marketing”, with no discussion about why or how. In my opinion, it’s because they don’t actually know. You can always tell people’s level of knowledge on a topic by the depth of their thoughts. Surface level thoughts = surface level understanding. Saying “use this tactic” without the fundamental understanding of why it works or how to execute it it is kind of like owning a manual transmission car and not knowing how to drive it. The car is effectively useless to you, and anyone who is unable to drive stick. For this reason, we need to establish a base-layer understanding of human behavioral biology, as it explains what drives human behavior. The entire job of a marketer is to influence behavior. You need to convince people it’s a good idea to pay attention to, invest in, and participate in your project.
At the core, human beings have a primary desire to leave copies of their DNA on the planet. This doesn’t mean everyone wants to have children, as there are other forces at play, but as a starting point, it’s useful to understand this biological desire. Generally speaking, this biological desire explains why status is more important to men than women, and why security is more important to women than men. To men, status is what increases your probability of leaving copies of your genes. To women, security is what does it. What you’ll also find is that behavior that seems to contradict this biological desire on a surface level does actually align when you dig deeper. When Marshall Applewhite, the psycho cult leader convinced 39 people in “heaven’s gate” to commit suicide you could point to that and say that killing yourself goes directly against the idea of being able to leave copies of your DNA. But when you look deeper, you find that the only reason these people decided to take their own lives was because Marshall had successfully manipulated them into believing that by taking their own life they were “graduating” and going to the next level, where they would be perfect, have perfect bodies, and so on.
As far as base-layer understanding of what drives human behavior goes, this is the main thing you need to know: we want to leave copies of our genes. We’ll discuss other forces that dictate behavior later on.
Principle
WHAT PEOPLE REALLY WANT
What marketing really tries to achieve, is to create an opportunity for project growth by communicating the value you can offer.
.. which begs the question: what is value?
The reason I first established that humans want to leave copies of their genes, is because this knowledge allows us to reverse engineer what people see value in.
Fundamentally we have to break value down into two components: intrinsic value, and perceived value.
Think of a Toyota Camry compared to Andrew Tate’s Bugatti Chiron.
Toyota Camry: $29,000
Bugatti Chiron: $5,200,000
Let’s explore this price discrepancy.
Intrinsic value is effectively the value that you place on the utility the car provides. What is having problem X solved worth to me? How much is it worth that I can drive from point A to B in 5 minutes, instead of cycling there in 25 minutes.. in the rain? That is worth $X amount.
In this regard the Toyota and the Bugatti are more or less equivalent.
The Bugatti does offer additional intrinsic value in terms of you getting access to the Bugatti community, which opens up networking opportunities and that sort of thing.
.. but largely the value discrepancy actually comes from the perceived value.
Perceived value is the additional intangible psychological worth we (almost always subconsciously) associate with a purchase.
Do you think there are any positive feelings associated with dropping $5.2 million bucks on a badass car?
Do you think there’s any dopamine release involved?
Do you think the guy who gets a Bugatti feels a sense of higher status in the social hierarchy?
Do you think this is reinforced by the fact that the car snaps necks as the guy drives down the street and everyone does a double take?
Do you think the guy feels proud of his achievement?
What do you think all these feelings are worth?
They’re priceless.
That’s why people will pay $5.2 million dollars for a car.
Your market cap, token price, and NFT floor price is dictated by the same forces.
We’ve seen lots of projects that succeeded in crypto with zero intrinsic value, purely built on perceived value.
I’m not going to suggest that it’ll never happen again, but it will become very rare.
The reason for this is that every industry goes through the 4-stage lifecycle of a market, and in the introduction stage the expectations from consumers are incredibly low, as everything is new. As the industry matures consumer expectations increase substantially and competition increases, which drives out low-value projects.
With respect to increasing the value of your project, there are two categories of actions you can take: intrinsic and perceived.
On the intrinsic front: you can increase the level at which you solve a specific problem for the target audience. Meaning: your solution currently saves them 2 hours per week, but if you got it to 10 hours per week it would be worth more.
You can also solve more problems thus increasing the value. Amazon started off selling books online, today they’re the top cloud infrastructure provider, they’re in the entertainment/streaming business, they sell every physical product under the sun online, and they’re a supply & logistics company. They sell reading devices, and.. you get the point. They started off solving 1 problem, and then increased how valuable they are by solving other problems.
The thing about increasing the intrinsic value is that it’s pretty much a requirement for long term success, especially in an industry where a lot of the products are open-source, ready to be forked in 24 hours. There’s no competitive advantage in an open-source product (that has to come from something other than the product itself).
So improving intrinsic value is difficult, time consuming, a pain in the ass, and also 100% necessary.
It does often take time to improve the intrinsic value, so while it’s my belief that it should be done, improving perceived value is a great way to amplify your results both in the short term and the long term.
How do you increase perceived value?
In a nutshell: strong vision, branding, positioning, messaging, and community.
Fear not, we will cover each one here today.
Principle
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THE BIGGEST VARIABLE TO SUCCESS
Before we unpack vision, branding, positioning, messaging and community, there’s a really interesting idea that is useful to be aware of.
Once I learned about this study and cross referenced it with my own experience, I couldn’t help but agree with the conclusion.
You may not like what you’re about to read, because this variable is largely outside of your control. But not entirely, by being aware of what we’re about to discuss you can actually use it strategically to your advantage. Also on the contrary, by not being aware of this important variable and its impact on your probability of success you’re leaving a lot of that success up to chance.
There’s a very interesting Ted talk from the founder of IdeaLab, where they founded & invested in hundreds of companies. The founder wanted to know what the difference was between the startups that succeeded and those who failed.
He charted hundreds of companies and evaluated them based on:
- The idea
- The team
- The business model
- The funding
- The timing
Airbnb was passed on by many prominent investors, but what they didn’t factor into the equation was that Airbnb was born right at the height of the 2008 recession and people really needed extra money. The idea worked, and Airbnb is what it is today. Before Youtube came along there was another project called z.com which had great funding, Hollywood talent had signed on to make content, but broadband penetration was too low in 1999-2000, and you needed codecs. There were just too many technological constraints at the time to make watching videos online enjoyable. Then Youtube came along later on when these problems were fixable, and became the second biggest search engine in the world.
In his study, he found that it was not the idea, the team, the business model, or the funding that was the largest contributor to success. It was the timing. In the study they concluded that timing accounted for 42% of the success of the business. The team/execution 32%, the idea 28%, the business model 24%, and the funding 14%. You can watch the Ted talk here.
Having started several business, and created many offers I can’t help but co-sign this idea. The times when I inadvertently nailed the timing, it was literally 10x easier to make a sale. Those times when I was too early, or too late, it was like eating glass trying to make a sale.
In my opinion, timing should be considered in several ways for web3 projects.
First and foremost, depending on your project, there’s something to be said for dictating the scope based on timing. Meaning: if you’d like to launch your app with all the features flawless and add 2 years of dev time, this might be a great idea if you expect the market, and responsiveness to your product to be where you want it to be 2 years from now. On the contrary too, if you’re 2 years away but 6 months from now would be the ideal time to launch, you may want to consider launching a more MVP-type app and improve it + add features post-launch.
Also from a marketing standpoint, timing can be used to your advantage or against you. If you had a project on the Terra blockchain when the whole thing crashed I’m pretty sure it would be incredibly easy for you to score press in Coindesk, Forbes, WSJ, Cointelegraph, and so on if you just came up with a decent angle.
Timing is absolutely a gargantuan needle mover, so let it be part of your decision-making.
Principle
WEB2 VS. WEB3 MARKETING
It’s also helpful to understand the shifts in dynamics going from web2 to web3 as it relates to marketing. In web2 the only people to benefit from the success of a business were the owners, which in 99% of cases meant less than a handful of people.
In a web3 business every token/NFT holder is an owner. So instead of 2-3 people being incentivized for a business to succeed (web2) you might have 20,000-100,000 people who are incentivized. This is great. You won’t find a more powerful marketing tool than a large army of people who are all incentivized to achieve the same goal. They’ll tell everyone they know. They’ll make content about it. They’ll think about it all day long. Word of mouth is simply the best type of marketing you can have, and in web3 the incentives to accomplish it are inherently built into the decentralized ownership model.
That’s the first difference between web2 and web3 marketing: the landscape completely changes as a result of 2-3 people being incentivized to promote a project, to hundreds of thousands of people.
The other difference is that in web2, if you had a great product, knew how to capture attention, create demand, and close the sale, you won. Again, these are now table stakes, and the variables that will determine LONG-TERM success have changed.
As most of us who transitioned from web2 to web3 realized, we had to change the way we thought in order to have a chance at success in web3. The majority of projects are decentralized and open source. This means that PRODUCT, which used to be a competitive advantage, can now be forked with a few clicks. If 15 copies of your great product are popping up everyday, you’ll end up playing a game of competing for attention, and it’s a game you will lose. All of the projects will compete against each other, stealing market share, and fighting for scraps.
So how can you win, given these facts? To explore this we should start by looking at the 1981 Pepsi Challenge TV commercial. Pepsi organized a blind taste test against Coca cola, and found that Pepsi won the challenge by an unexpectedly high margin. All else equal, Pepsi was the superior product.
Here’s where it gets interesting, when you and I go to buy cola, given the choice, we buy Coca cola. Why do we pick an inferior product when given the choice?
Remember the token price formula from before?
This applies to products and services just as much as it applies to a token, or a stock price. This tells us that the perceived value of Coca cola is making up for the difference in intrinsic value (taste). Interesting.
When you dig deeper, and think about it, you find that Coca cola has been programming us for decades with one simple idea: Coca cola = Happiness. The art of advertising is unfortunately completely lost in the corporate world these days, but if you look at older ads that associated Coca cola with Christmas, and Santa Claus, you can start to see how the feeling of happiness was being programmed. It worked, and it’s still in effect.
Apart from Happiness, there’s another, even more important driver at play here, which requires digging even deeper. Let’s come back to the old coca cola ads with Santa Claus running, the chants in the background going “something’s something.. Something’s coming” paired with the constant imagery of an incredibly tasty looking cold glass bottle. The ads are always leading up to the moment where they pop the cap and have that first sip. They’re building up the anticipation of that amazing moment. In fact just typing this brought back an old memory of waking up hungover as a teenager, mouth dry as a desert, literally crawling over to the mini fridge in my room, popping open an ice cold coke, and coming back to life as I chugged it all down. Ok back to business. It’s impossible to measure, but the marketer in me who understands human behavior knows that this is even more powerful than the feeling of “Happiness”. What’s that you say? Dopamine.
Dopamine is the addictive chemical tied to rewards. They did a very interesting study on monkeys where they taught the monkeys to perform an activity in exchange for a reward. Every time the monkey did the activity, they received the reward. They measured dopamine response from this experiment. Then they did something interesting, by introducing uncertainty. Instead of giving the reward every time the monkey did the activity, they only gave the reward 50% of the time. Guess what happened? Dopamine response increased significantly. By introducing the maybe into the equation they were able to drastically increase the very addictive dopamine release. This is what Las Vegas is built on, and guess what, it also explains why crypto is so addictive. This is why people wake up in the middle of the night and check their Bitcoin. They also experimented with giving the reward 25% of the time, and 75% of the time, which both elicited a dopamine response somewhere in the middle of the 50% and the 100% experiments. The 50% was a clear winner in terms of dopamine response.
As you can see on the diagram, dopamine is not released as a response to reward, it’s released during the anticipation phase. This is why they say the best part of taking a drug is the moment right before. And this is also why the dopamine significantly increases when you’re not sure if the reward is coming or not. Coca cola is selling the dopamine hit of the anticipation of that first sip.
Coca cola sells the anticipation of the first sip
I recommend checking out Robert Sapolsky’s Stanford classes on Human behavioral biology on Youtube, where I first learned about this experiment.
Now, there is another word for all this happiness and dopamine stuff.
It’s called Branding.
Contrary to what most people believe, your logo, color scheme, font, tag line etc is not branding.
If you make them feel something desirable, chances are you’ll come out ahead of competitors, even with an inferior product. Pepsi makes us feel nothing. This begs the question: WHAT should you make them feel? Well, you can control this, but I’ll give you a starting point so you know where to begin, which brings us to the second variable with respect to the NEW competitive advantage.
Community.
As you’ll find shortly, once you get clear on what type of community you are building, you will also be very clear on WHAT you should make them feel. If you do a good job with branding and community, you’ll have a competitive advantage that will take years to copy, which they are unlikely to succeed with even if they’re aware of it. So let them fork your product, and let them try to copy your branding and community as you laugh from the sidelines.
Before we break down community, we must first clear up some confusion around the topic. The word community is completely over-used in crypto, and 99% of those who utter the word have no idea what it means. You won’t be one of them after reading this.
I was on a call with a VC investor recently, and he was telling me about “how they grow community.” He proceeded to break down the most basic cheap tactic to increase social media follower count, and at that moment I realized that he thought community and social media followers were the same thing. They are not. Social media followers definitely have value, as we’ll get into later, but they are not to be confused with community. This goes for discord users as well, just getting more people into your discord does not mean you are growing your community.
A group of people in the same place do not inherently have anything in common other than the fact that they are in the same place. There’s no automatic bond between those people.
The other term that community is confused with I learned when I saw the CEO of Celsius, who had just frozen withdrawals and filed for bankruptcy, send out a tweet which said something to the effect of “We have to do this, thank god we have such a loving supporting community, we’ll get through this together”. Celsius did not have a community. Celsius had customers. That also, is not what community is.
So if community is not social media followers, discord users, or customers, what is it?
Community is a group of people who want the same thing in life. They are on the same path, and they have 1 shared core desire that they optimize their life around. Carl Jung wrote about archetypes in the 1950s. He came up with 4 cardinal orientations
Ego – Leave a Mark on the World Order – Provide Structure to the World Social – Connect to others Freedom – Yearn for Paradise
From those orientations, 12 archetypes have been extracted, and effectively each archetype has 1 core desire. 1 thing in life they value over everything else. This 1 core desire is the foundation of your community.
A community is a group of people who share one deep rooted desire.
Hollywood picked up on this as well, and made sure every leading character in their movies was congruent with 1 of the archetypes. Let’s go through them now.
Here’s a table of the archetypes, their 1 core desire, and a movie character example.
You have to figure out which archetype fits you, and the one that makes sense for your community. Once you are clear on this you can think much more clearly about what you want them to feel by getting involved in your project. It will also help you figure out the name of your project, the logo, the tag line, the messaging, and so on.
So your branding and community very much go hand in hand.
Also, it’s helpful to understand why community matters. The reason community is important is only for one reason: it gives you extended attention that can be deployed to further the goals of the business without needing to pay for it over and over again. There is no inherent need for a business to have a community in order to be successful, but in order to succeed in business you need attention. Not once, but over an extended period of time. That’s what community can provide.
This is the second difference between web2 and web3 marketing: the competitive advantage variable has changed.
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CONVINCING VISION
Let’s now come back to the topic of perceived value. One of the ways to increase the perceived value, or rather, the perceived FUTURE value of your project, is to have a strong vision.
Wayne Gretzky
You’ve heard of this idea before: “companies need to have a vision.” This was somewhat true in web2, and it’s very much true in web3. Let me explain. In web2, most companies, like 99%+ are very small businesses with 1-5 people involved. And as you know, the only people to benefit from the success of a web2 company are the handful of owners of the company. Let’s take an ice-cream shop as an example, and let’s say they had a vision to “bring happiness to every person on the planet through delicious ice-cream”. This vision does absolutely nothing for the consumers of the ice-cream. You could argue the employees of the company were slightly moved by the ambition of the company, and that they’d come to the conclusion that it was in their best interest to do a great job in hopes of the company growing, and this growth serving them through promotions, salary increase, and so on. A company vision in web2 became more important as the business started to take on serious headcount, where it became vital to ensure this large group of people were all on the same mission, heading in the same direction. Vision serves a different purpose in web3. Or rather, in web3 your vision has an internal purpose, and an external purpose. The internal purpose is what we just covered: how the vision affects the people inside the business. The external purpose has a different goal: to convince people to pay attention, participate, and in some cases invest money.
As people do their due diligence on your project, they are trying to form an opinion on what will happen in the future as it relates to the project. Well, your vision is explicitly communicating the goal of the project. It’s saying “here’s where we want to be in the future”. This brings up an important component for your vision: it should be ambitious, but not impossible.
If you don’t tell them what you’re trying to achieve they’ll just assume that whatever it is you’re working on right now is pretty much the extent to which you’ll grow this thing.
Even with one of my clients, we didn’t really discuss his vision until a month into working together as we were focused on other things, and when I found out about his vision the value of his project in my eyes (perceived value) went up about 100x.
THAT’S EXACTLY THE RESPONSE YOU WANT.
Where you are right now is not exciting to anyone, where you’re trying to go is very exciting.
If you explain where you’re trying to go you’ll find that a lot more people are going to pay attention.
So, the next question is HOW do you come up with a strong vision?
First off you need to be clear about your target audience. Many web3 projects I find have several target audiences, but there’s always one primary audience.
If your project has a token then retail investors are always going to be one of your audiences, but chances are the problems your project solves are actually for a different audience, and that’s who you need to focus on first and foremost.
The other thing you need to be clear on is what mountain you’re actually trying to climb.
The level of your goals dictate the level of your vision, which dictates the potential of your project. The more ambitious the harder it will be, and the higher potential there will be if successful.
Ultimately, the psychological response you want to elicit from people reading your vision is something to the effect of: “If they are even partially successful with their vision, that means this project will grow tremendously. If the project grows tremendously and I’m involved, that will be good for me.”
You see that?
Charles Hoskinsons pinned tweet says “Cardano is an open platform that seeks to provide economic identity to the billions who lack it by providing decentralized applications to manage identity, value and governance.”
This is a great vision, and it explains why Cardano reached almost $100bn market cap in the 2021 bull run, with very little development activity and problems being solved RIGHT NOW. It’s because people didn’t buy $ADA because of where it was at that time, they bought it based on where it could be if they succeed with the vision.
So your vision ultimately comes down to painting a picture of an ambitious outcome in the future. Don’t make it unrealistic, but it should be a stretch. You’re not necessarily meant to literally achieve your vision one day, it’s more about what you’re attempting to do, and which direction you’re going in.
If you want people to care about what you do, come up with a strong vision.
Principle
SUSTAINABLE BUSINESS MODEL
We have already discussed the importance of intrinsic value, and competitive advantages.
On the topic of longevity we do need to discuss one more thing: CLTV, or Customer LifeTime Value.
As the market matures competition for attention and customers will ramp up.
Ultimately, the project that can pay the most to acquire the customer is going to win.
If 2 projects are identical on the front end, they solve one problem, the same problem, for the same target audience. But one of the projects solves other problems on the back end as well, which they monetize. They’ll make more money, and be able to afford spending more to acquire customers.
Say Project 1 has a $100 CLTV and Project 2 has $1,000 CLTV.
As long as our CAC, or Cost to Acquire a Customer is $90 Project 1 is still in business, making $10 per customer.
As soon as that number goes to $110 (it always does sooner or later) Project 1 is now losing $10 on each sale, while Project 2 is still making $890 per customer.
Project 2 would eat them alive. The reason no one is talking about this in 2022 is the crypto market is still only in phase 2 of the 4-part market lifecycle.
Things are going to get harder.
There’s a scene in the movie The Founder about Ray Kroc and McDonalds, where the business is growing, more and more franchises are opening up, more burgers are selling, and yet the business is losing money.
Kroc ends up in a spontaneous meeting with a finance pro (“CFO”) who asks him a couple of questions about the business.
CFO: “Tell me about the land, the buildings, how that whole aspect works.”
Kroc: “Pretty simple really. The franchisee finds a piece of land he likes, gets a lease, usually 20 years, takes out a construction loan, throws up a building, and off he goes.”
CFO: “So the operator selects the site?”
Kroc: “Yeah”
CFO: “He picks the property?”
Kroc: “Right.”
CFO: “You provide the training, the system, the operational know-how, and he’s responsible for the rest?”
Kroc: “Is there a problem?”
CFO: “A big one. You don’t seem to realize what business you’re in. You’re not in the burger business, you’re in the real estate business. You don’t build an empire off of 1.4% cut off a 15 cent hamburger. You build it by owning the land upon which that burger is cooked. What you ought to be doing is buying up plots of land, then turning around and leasing said plots to franchisees, who as a condition of their deal should be permitted to lease from you, and you alone. This will provide you with two things. One: a steady, upfront revenue stream, money flows in before the first stake is in the ground. Two: greater capital for expansion which in turn fuels further acquisition, which in turn fuels further expansion, and so on, and so on… Land.”
This is a great scene because it actually points out a real business problem that many business owners are unaware of. The business they’re actually in is often not the surface level business they think they’re in. What this all means is that there’s levers you can pull in any business in order to move the needle with respect to growth and expansions. Those levers are very often not the surface level levers that one might think. For McDonalds, it wasn’t about trying to sell more hamburgers. Selling more hamburgers was a result of pulling the land acquisition lever.
Pulling the land acquisition lever was also the thing to increase their CLTV. Not from their burger customers, but from their franchisees, who is another customer segment of McDonalds. Instead of only making money from a cut of the burgers, they’re also making a substantial amount from the lease agreement, increasing their franchisee CLTV tremendously.
Principle
ENDURING COMMUNITY
The reason a community is valuable to a project is that it can provide you with the luxury of attention over an extended period of time.
We also covered what community is, and what it is not. You can review that above if needed. What I’d like to do here is illustrate an example from the crypto space that we’re all familiar with, and explain one of the main underlying reasons that it got to the point that we are all aware of this brand.
As you’ll recall, community is built on a common identity, and in my opinion, this project’s success had A LOT to do with the fact that their project was actually built on an identity.
I’m talking about Bored Ape Yacht Club. Regardless how you feel about the project, the numbers don’t lie.
The whole concept was built on people who “ape” into investments with little or no due diligence, who made a lot of money in crypto, and therefore did not need to grind a normal 9to5. Instead they end up bored, hanging out at a “yacht club”. The twist about the yacht club being a dive bar I thought was a nice touch also. The suit and tie vibe you’d expect from a proper yacht club would likely feel incongruent to the crypto degens they were targeting, so I believe it was a great spin on the whole thing. The prestige of a “yacht club” with the aesthetics of a dive bar, where degens would feel right at home.
At its core, they spoke to the one desire that gets most people into crypto: financial freedom. Who in crypto wouldn’t want to be bored, because of what it signifies? Being bored because you’re loaded and can do whatever you want? That’s their dream! From watching interviews of the founders, I don’t get the impression that this was all calculated, but they definitely put thought into it, and they absolutely nailed the cultural relevance, the timing, and the fact that it was all built upon a common shared desire. I salute you sers.
Now, having a community is great, but the key is to have an enduring community. All communities are going to go through good and bad times if they exist long enough, and the strong ones will endure over time. The difference between the ones that get through tough times versus ones that don’t also comes back to the idea of a common shared identity. When the group of people is there for the same reason they stick together, and they don’t split into separate groups, unless the core desire they originally had has actually changed, which definitely can happen.
When I was younger it was all about freedom. I didn’t want a boss. I didn’t want to work in an office. I wanted to be able to move around and do what I want, when I want. As I got older, that became less and less of a need, and I started to derive value from other things. Before, I derived value from new experiences, but as I did a ton of traveling, started a family, and also fell in love with my work, Freedom became less important. Instead, what I get value from now is creating things. When I’m creating things I am learning, growing, and feel a great sense of pride in the work. That’s much more rewarding to me now than being able to hop on a business class flight to NYC on a whim (altho that too sounds pretty good right about now).
Get clear on what identity your community is built on, and look at BAYC for inspiration with respect to choosing the name of the project, the nuanced cultural accuracy and timing, and you’ll do really well.
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EMOTIVE BRAND
We discussed branding above. As you’ll recall, it comes down to one simple idea: how does your brand make people feel? The answer to this ties directly into the Archetypes and their one core desire. As you revisit the list of archetypes and their desires you might notice that all the desires are really just emotions. You are in the feelings business. The innocent want to FEEL happy. The hero wants to FEEL important. The ruler wants to FEEL in control. And so on.
What you’ll find is that once you are clear on the fundamental feeling that your community and brand is built on, it should help guide everything from project name, and branding color palette, to the website headline, and what you Tweet. What branding really comes down to is to constantly reaffirm the idea that “if you are part of this project, buy our product/service, and so on” then the outcome is that you will feel the one feeling that you’re looking for.
This is really important. When I used to teach people how to create a marketing agency the same way that I had successfully done, I really struggled with one big concept. Most people who bought my books, courses, and coaching didn’t do anything. By buying my products they communicated to me that they wanted to learn how I did it, but then they didn’t do anything which really confused me. I also noticed that the people who sold similar products to me that did really well spent a lot of time talking about things that didn’t directly help their students get the outcome. That’s when I realized that I was only partially in the “results” business with that particular market. I was more so in the “feelings business”. More specifically, I was in the “make people feel like they’re making progress without putting in difficult work” business. This was really tough for me to accept because I personally never wanted to listen to anything other than “do XYZ to get the outcome”. As an experiment I made a video lesson about mindset, goals, and I gave them homework to do. I told them go get a notepad and a pen and write down the answer to these questions blah blah blah. It was by far the most impactful content in my entire course. Why? Because it gave them the exact thing they really wanted, the feeling of growth.
You have to know which business you’re in, and specifically what feeling you’re selling.
The best way to figure this out is to observe your “customers” actions, not their words. It’s our job as marketers to know our customers better than they know themselves. When I asked my customers what they wanted they told me something that wasn’t really true. They told me they wanted the outcome, but they didn’t do the work because they really wanted the feeling of growth without doing all the hard work. They’d rather take the feeling without the real outcome than the outcome without the feeling. In that case I had to give them both because you can’t sell an outcome and not deliver on that, so I had to give them both the feeling of growth, as well as the important steps to getting the outcome. The main point here is that you can’t trust what they tell you because they’re unaware of it themselves, you have to observe them and you have to know them better than they know themselves.
While most communities basically all fall into one of the 12 archetypes / core desires, there are many more feelings that are in the same category, that can be attributed to a brand. Meaning two projects can both be appealing to The ruler archetype but have a slightly different “desired feeling” they want to associate their brand with.
Principle
HIGH-VALUE POSITIONING
It’s an odd example, but hear me out for a second. When Dan Bilzerian was on the Joe Rogan Experience podcast they talked about money and fame. There aren’t that many people on the planet who have both, who fully understand what it’s like to have both, and who can speak on it. There’s a lot more rich people than famous people. Hearing about the impact that one has compared to the other was in my opinion very fascinating.
Bilzerian said that when it comes to getting laid, he felt that fame was around 20x more powerful than being rich. As a marketer, I found that fascinating. And if you haven’t figured it out yet, the reason we’re talking about this is because this applies to things other than getting laid, such as having success with your web3 project, although if you use it to get laid also I won’t judge.
So two things we need to explore: WHY is fame more powerful than money? And HOW do you become famous?
Let’s start with why fame is so powerful. You’ve heard the question “how long is a piece of string?” before. And for argument’s sake we could tweak the question a bit to “how much is a piece of string worth?” The reason you can’t answer the question is because you don’t have enough information to evaluate. You don’t know what the string is made of, and how long it is. Regardless of material, surely a 1,000 meter piece string is worth more than a 1 meter piece of string, right? But if you knew that it was 1 meter long, and it was made of linen you could use that information to evaluate the worth of the string.
When it comes to social value, the way we gather information to decide someone’s social status is to look at how other people are valuing the person or brand in question, and that becomes our default.
One time I was at a pool party in LA during the day. Everyone was partying, having a good time, but one guy seemed to be having more fun than others. His name was Jesse Metcalfe, the actor who played the gardener in Desperate Housewives. In case you’re unfamiliar, the dude is handsome, and this was at the height of the show, and his fame. With no exaggeration, I can tell you that at this pool party Jesse was standing with his back up against a wall, drink in hand, and there was a line of about 5 blondes waiting to talk to him. They’d go up one at a time, talk to him for about 2-3 minutes, give him a kiss on the lips, and then the next girl stepped up for her turn. I never saw anything like it.
So if 50 people in a room are all looking at one particular guy, trying to talk to him, take selfies together, kiss him, and so on, you could say that subconsciously, it seems to you that he might be 95/100 on the value scale in this particular scenario (it can vary dramatically depending on the scenario). So without any interaction or knowledge, purely based on other people’s behavior, if asked, you would also give him a valuation around that range. The opposite is true too. If a room of 50 people paid no attention to one particular dude, you too would default to placing him in the “low value” category. Obviously we don’t have such an explicit scale, it’s all based on social signals and behavior.
Now, what if you imagine 2 people, neither is really famous, but you learn that one is rich and one is broke. In terms of social status, if asked to evaluate them, you would rate the rich person higher than the broke person, but nowhere near as high as if they were famous. The reason fame is more valuable is because it’s a more scarce and valuable resource. Fame is attention, which can be automatically transferable. If your best friend came from a wealthy family (not self made), and you hung out everyday, you wouldn’t automatically get wealthier. But if your best friend was really famous, like say Gary Vee for example, you would automatically receive some of the attention/fame that was originally deployed towards Gary. A lot of people who watch Gary’s content know who Drock is, because he was the main videographer filming the content, and spent a lot of time next to Gary, therefore receiving some of the attention.. This all comes back full circle to the idea of the human species wanting to leave copies of our genes. Fame is a disproportionately valuable variable as it relates to your ability to leave copies of your DNA. Everyone wants a piece of you, either to literally reproduce, or to do things for them that would be in their favor. This of course is also why being rich has some value, as opposed to no value. It’s just not as valuable as fame.
Money, to a degree, can be used to acquire fame too. If you really boil it down, fame is just people paying attention to you over an extended period of time. If you can acquire attention at scale and over the long term, you would be famous. Of course, if you’re famous for doing bad things or being a bad person you’d still be famous, it just wouldn’t be as pleasing. But go look at UFC for example, even the fighters who purposely play “the bad guy”, like Colby Covington, end up with a large pool of people who dislike them, and also a sizable pool of people who love them. The more polarizing the person is, the more love and hate you’ll see towards them. Donald Trump is another good example of someone who is very polarizing, which adds to their fame, because the outrage against them leads to comments, reactions, press pieces, social media clips, and so on. And that is all attention, which is fame, which is why the saying goes “no such thing as bad press”.
Now, attention is the main ingredient, and how effectively that attention turns into people who want to continue to pay attention comes down to the person and the value they provide. Some people have actual starpower. You ever meet someone who just has this energy about them? They walk into a room and the whole vibe changes? Sometimes that is only in real life, sometimes it’s in real life and on screen, and sometimes it’s only on screen and the person has little effect on people in real life. The reason I bring this up is because when it comes to “purchasing fame”, as I alluded to above, you can use money to a degree, but the thing that moves the needle in terms of converting the attention to extended attention is really the person, and the value they provide. I know people with starpower, but they don’t have the attention component, so they’re not famous. Now, some people are famous because they’re attractive, because we find it valuable to look at them. Some are famous because of their ideas. Maybe those ideas help us improve our lives. Others might be famous because they provide entertainment and escapism. There are different ways to be of value. Think of Jordan Peterson for example. He’s polarizing, very intelligent, and his ideas are loved by some, hated by others, and not notably attractive. Very famous, because his ideas catch on fire. IG models are famous because they’re nice to look at, and Andrew Tate is famous for his ideas and the mystique about him, which is then fueled by his polarizing views that causes outrage.
Now, on the topic of purchasing fame, like we’ve established, it comes down to sustained attention. Nowadays you can literally buy attention. You can go buy ads on youtube, or IG, or FB. You can pay influencers for a retweet, you can do all kinds of things that give you attention. The tricky part is being able to convert the attention into something long term (that’s where the person in question, and their value, moves the needle).
The other aspect here is the idea of associations. As we touched on, all else equal, The Rock’s right hand man would automatically be placed higher on the social hierarchy than you for the only reason that he’s close to The Rock. Associating with other famous people automatically increases your social status.
We’ve covered a lot here on the topic of fame, so it’s worth summarizing. Fame is nothing but attention sustained over time. It’s a scarce and very valuable resource, which is why if you have it, people will value you much higher in the social hierarchy. You can purchase attention, and convert it to sustainable attention to a degree, based on your natural starpower and the value you can provide (ideas, attractiveness, entertainment, etc). Associating with other people that are high in the social hierarchy automatically increases your value further. Fame, if used correctly, can be a great amplifier to your personal brand, and your web3 project, since you can convert the attention the fame brings, into things like users of your project, coin or NFT hodlers, offspring (:P), and so on.
That concludes the positioning principles.
Principle
MAGNETIC MESSAGING
You should think of messaging as fish bait. You’re using words to entice the person on the other end to pay attention to you, and take some kind of action. How do you get their attention? By dangling the exact thing they want, right in front of them.
This brings us to an interesting question…
What do people want?
Now we’re talking. This is the kind of question you should be asking. Knowing the answer to this will immediately make you a 100x better marketer. The bad news: what people want.. depends..
We do have some things in common. For instance, the number one goal for most people on the planet is to leave copies of our genes.
This desire leads to all sorts of strange behavior. The desire to reproduce is true for animals as well. There’s a type of monkey called tamarin monkey that has shown absurd behavior. Researchers found tamarin mothers sometimes kill their own babies. That doesn’t make any sense on a surface level, but once you study the tamarins you effectively come to the conclusion that, based on certain variables, such as how many males are in the tribe to protect the young, the likelihood of the infants surviving can be very low. They found that when mothers realized their young effectively had a low chance of surviving, since their goal was to leave copies of their genes, their best bet would be to kill their own infants, and get pregnant at a later time, when circumstances are more in their favor.
Inexplicable behavior, explained. At first it seems contradictory. If the goal is to leave copies of their genes, it doesn’t make sense to kill their own babies. But if the ultimate outcome of killing their infant is that they have a greater chance of their babies successfully growing up, then all of a sudden this absurd behavior starts to make sense, even though it’s seemingly contradictory.
Why do I tell you this? Because if you understand behavior, you’ll know how they’re going to act. And if you know how they’re going to act you can plan accordingly.
Because of this idea, I stopped doing surveys. I used to ask my audience things, in order to learn more about what they wanted. But one day I realized that I know them better than they know themselves. If I ask them, they’ll tell me the surface level reason without understanding where it’s coming from.
For example, guys don’t want Lamborghini’s because of the intrinsic value of the car. Guys want lambos because it will give them status. If they have status, people (girls especially) will pay attention to them, and make them feel important, and their likelihood of leaving copies of their DNA increases.
Can you imagine a survey asking a guy why he wants a lambo? Do you think he’d give that as the answer? Or do you think he’d say sports cars are cool and he loves cars?
When it comes to messaging, and giving people what they want, it’s also important to understand one crucial idea: EVERYTHING that you say and do is either having a negative, positive, or neutral impact on your positioning..
There’s a phrase I learned from Blair Warren which is something to the effect of “People might believe what you say but will never doubt their own conclusions”.
If you say something, they might believe you.
If you do something seemingly uncalculated, which gets them to come to some type of conclusion on their own, as far as they’re concerned that conclusion is now fact.
Imagine you’re at a dinner, you meet some new people. One of the guys at the dinner keeps bragging about how generous and charitable he is. On the way from the restaurant he gets approached by a homeless person, who he rudely dismisses. There’s an incongruence between what he said, and what he did. Which do you believe? His words or his actions? Exactly. Your own conclusions are always going to beat what someone will tell you using words.
What about this scenario? Another dinner. More new people. The guy in this case doesn’t say anything about his generosity, or charity. Quite the opposite, he tells you he’s selfish and is just laser focused on himself. At the end of the dinner he picks up the bill, and on the way home the group says goodbye and everyone goes their own ways. When you turn around you see the “selfish” guy give a bunch of money to a homeless guy (and he thinks no one is watching). In this case, you’d conclude he is actually not so selfish, and that he’s a good guy. Your conclusions override what he told you.
The point here is that if you want someone to believe something, the most effective way of achieving that is not by telling them, it’s by showing them. Allow them to come to the conclusion on their own. Give them the ingredients, and let them bake the cake on their own.
So far, we’ve touched on the idea that you know what people want, and the most effective way to transmit information. What I’d like to do next is to provide a simple framework that will help you figure out what your content should be about.
Again, we come back to Blair Warren, who also said..
When you’re communicating with your community, these are things you should do to strengthen the relationship.
Encourage their dreams
Justify their failures
Allay their fears
Confirm their suspicions
Help them throw rocks at their enemies
A good starting point to effectively doing this is to think about the following questions
How and why have they failed to achieve this dream previously?
What fears do they have about this dream?
What suspicions do they have about it?
What’s the enemy preventing this dream?
Once you have some clarity around these, you can start to add these ingredients to your language. What you’ll find is that you’ll start to resonate on a deeper level with a segment of your community, and another segment may dissipate (this is good). You want Trump-level fans who love you for you, not Biden-level fans who choose you in absence of a better alternative.
The final thing I’ll say here is that you should pay attention to the way your community communicates. Are they using certain words? Slang? Be mindful of how they communicate, and speak on the same level, with the same words. You’re likely to be influencing them more than them influencing you on this front, but just be aware.
The easiest way to gather data on this is to jump on 1on1 calls with people from your target audience and simply asking them questions.
My first youtube video on crypto marketing had “crypto marketing” as the main title, because it was broad enough to get people in, but not super specific as I didn’t yet know what people wanted.
That video has 5.5% click through rate on Youtube. This tells me something about how relevant and interesting the topic is to people.
After having done 10 calls 1on1 with people from my audience, I realized that 8 out of the 10 people all wanted the same thing: Go-To-Market strategy. So I leaned into this, and made another youtube video the next day, making sure to put “Crypto go-to-market strategy” in the title.
That video has 12.2% click through rate. More than double the first one.
Imagine if everything you said got a 2x higher response than now. How do you think that plays out over time? That compounds pretty quickly.
The point is that when it comes to nailing your messaging it comes down to starting to communicate, getting to know your audience better, observing the patterns, and then leaning into the things they really want
Principle
Credit to Blair Warren
EFFECTIVE GROWTH TACTICS
Up until this point we’ve been very focused on strategy.
We’ve made sure you set yourself up to succeed by coming up with a vision that you believe in, that people can get behind.
We’ve designed the business in a way so that it can continue to grow without the need for new people to join the network, once a critical mass has been reached.
We’ve gotten clear about what community is all about, and how you need to figure out the identity / core desire of the community, so that you can give them what they want.
We’ve figured out the feeling your users & community need to feel when they think of you, in order to set you apart, and how your branding is all about continuing to strengthen the association between your brand and that feeling.
But now it’s time to put a campaign together in order to get the ball rolling. Even if you did everything right with respect to what we’ve discussed so far, people still need to find out about you before these things can prove themselves as effective.
The thing to keep in mind when it comes to tactics is what we discussed in the messaging section above: everything that you do has a positive/negative/neutral impact on the project as a whole. If you resort to cheap tactics, you may experience some surface level growth, while doing irreparable damage to the brand.
How many times have you received a Twitter DM that says something to the effect of: “Congrats on winning a whitelist spot for *insert NFT project no one gives a shit about* – blah blah blah”? NFT projects for the most part operate entirely on perceived value, and the subcommunication from spamming DMs is definitely not in your favor. It’s almost a guarantee the project will fail. Remember when we said that people might believe what you think, but they won’t question their own conclusions? Well, what are people concluding about your project when you have to spam their DMs in order for them to learn about it? Let me spell it out for you: their conclusion is that your project is garbage. You have to be really careful when designing your growth campaigns, because even if you yourself aren’t spamming DMs, you might be incentivizing others to do it on your behalf, and they can damage the brand just as much as you can.
This brings up the most important component of designing your growth campaigns: incentives.
Charlie Munger
Incentives drive human behavior, and the better job you can do aligning everyone’s incentives, the better results you’ll have. We discussed the difference between web2 and web3, and how web2 projects typically have a handful or less owners, whereas ownership is often distributed to thousands, tens of thousands, or even millions of people in crypto projects, which is why you see growth in web3 projects that you won’t find in web2. There are thousands of people incentivized to help the project do well.
One of the projects I worked for had all kinds of misaligned incentives that contributed to the project’s inability to gain traction. Even the founders were incentivized to prevent the project from growing too much, since they had to pay taxes on the token allocations they were distributing, because of where the business was registered. Their taxes were directly tied to the success of the project, so they’d subconsciously self-sabotage to keep the taxes manageable.
It’s very important that you put yourself in the shoes of every person who your growth campaigns will involve, and really go through their journey as if you were them, to identify whether you’ve inadvertently placed misaligned incentives somewhere in your campaign.
An example of this that I came across was an ambassador program that had a fixed pool of tokens available for the ambassadors. Let’s say the amount was 1000 tokens, and let’s say there were 10 ambassadors. This means that each ambassador was entitled to 100 tokens each. The project wanted WAY more ambassadors, but couldn’t figure out why nobody wanted to become one. There were 2 misaligned incentives in the program: the first one was that you had to contribute work to become an ambassador, and it was fully possible for you to spend a month or 2 contributing to the project and not earn any tokens. Let’s say that you got 80% of the way to becoming an ambassador. This meant you would not become an ambassador, and you would earn 0 tokens, instead of 80%. So the barrier to entry was very high. They could have just as well offered people the tokens they earned, and offered some kind of bonus or extra incentive for contributing enough to become an ambassador. The other force that was working against them was that they made it a fixed pool of tokens. This meant that all existing ambassadors were incentivized to keep other ambassadors out of the pool, as opposed to incentivizing them to spread the word. Because their 100 tokens would become 90.9 tokens if they helped someone become an ambassador (as we’d go from 10 ambassadors to 11).
These things are not trivial, they literally make or break your campaigns. Make sure everyone is incentivized to go in the same direction. I’ll quote Munger again: “Show me the incentive, I’ll show you the outcome.”
If you want me to do your thinking for you, here you go. Typically, one of the easiest tactics in crypto is a giveaway (assuming a token is involved). Giveaways worked in web2, they work really well in web3. Why? Incentives. Typically it means there’s a chance to win something in exchange for referring other people, and other tasks. The key is to prevent the low-level spamming that we discussed earlier. I recently spoke to a project that (nervously) launched a massive giveaway straight into a bear market, and in less than a month had over $40 million dollars in Total Value Locked. If executed well you can really tap into the viral nature of word-of-mouth, as long as incentives are set up properly.
Principle
CLOSING THOUGHTS
We’ve covered everything from the basics of human behavioral biology to specific growth tactics, and everything in between.
This is most likely an article that you’re going to want to read a few times, as you’ll have a different takeaway each time, depending on where you’re at with your work.
Ultimately these are the fundamentals that you need to come back to time and time again whether you’re launching a project or your project has been running for a decade and you need to ensure you can fight off the competition and continue to grow.
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