What a beauty
Marketing in Crypto
Successful adoption of MLM and beauty marketing strategies in the cryptocurrency market
Over the past decade, the crypto industry has proven to be a unique industry with a specific audience, which requires a no less specific approach. In this regard, in 2020, the advertising activity of crypto companies is significantly different from that to which banks and various financial companies resort. Industry leaders prefer not to rely on traditional online advertising on Facebook, Instagram, and YouTube. They follow a different path: they work with bloggers (opinion leaders and influencers), rely on MLM marketing referral programs, and actively organize various contests and giveaways with generous prize pools. CoinDesk claims that crypto marketing this year is strikingly similar to marketing in the beauty industry, which appears to be quite effective. So let’s take a closer look.
General Concept
Michelle Fan, a blogger with a million YouTube subscribers, is using the same tricks to spread skincare life hacks and the idea of financial freedom through bitcoins. Moreover, she assures that the leaders of the crypto industry, like her, use marketing schemes from the beauty industry, even if they do not realize that.
Both industries prefer to use the DTC (Direct to Customer) business scheme, independently creating and then promoting and selling goods/services, working as closely as possible with the community. Sales are built through aggregated retail platforms like Amazon, Etsy, and Shopify, or even through personal accounts in popular social networks.
Industry leaders in developing countries, where large venues such as Amazon, simply do not work or are not popular, often refer to the last option. For example, Michelle Haber, a bitcoin maximalist from Libya, made it clear in CoinDesk’s comment that social networks and chats are today the most effective way to distribute goods/services in crypto. He said that local traders, in order to educate the audience, help purchase hardware wallets by selling them through groups on social networks. Buying yourself Trezor or Ledger in another way is often simply impossible.
Working With Influencers
Michelle Fan is not the only person from the crypto community who notices the connections with the beauty industry. So, Maria Paula Fernandez, who actively uses the services of the DeFi sector and is seriously interested in the topic of skincare, gave the CoinDesk portal a similar comment.
She mentioned that in both cases, society has become accustomed to relying on the opinion of society itself, rather than trusting the opinion of the world’s leading media. Therefore, in both sectors, the so-called influencers are very popular — opinion leaders and bloggers who broadcast information among their audience on YouTube, Instagram, TikTok, and other social networks, receiving a reward for this.
Crypto companies very often, similarly to firms from the beauty industry, provide their products to opinion leaders for review and further “instruction” of their subscribers. While watching the experience of bloggers, subscribers begin to acquire a kind of crypto education and disseminate the information through word of mouth. Thus, the crypto community grows.
The most successful bloggers over time can count on sponsorship from one or another cryptocurrency company. For example, Marty Bent, whose podcast is now funded by Unchained Capital and Square. The last one, by the way, in addition to Bent also sponsors Joe Rogan’s and rapper Lil B podcasts.
Many other large companies, including the Kraken Exchange, have applied this strategy. They are just as interested in sponsoring well-known content creators who promote products among loyal subscribers. The U.S. exchange sponsors famous podcast Peter McCormack, who launched his own media brand Defiance last year. Having started his career as a hobby, McCormack turned it into a business of his life, thanks to which he earned about $ 1 million for 2019.
With all this, working with bloggers is an excellent opportunity to enter foreign markets. That was used by Crypto.com, where they use opinion leaders to attract the Russian-speaking and Turkish-speaking community. Does this approach give a result? Judge for yourself: over the past six months, the number of startup users has doubled and currently stands at more than 2 million people.
Referral Bonuses and MLM Marketing
The development of products within the community often turns into MLM marketing strategies, which involve the presence of referral bonuses and “in-depth bonuses ” — a favourite scheme of cosmetic brands. They use a multi-level reward system for attracting partners, where you can usually get a bonus not only for personally invited but also for “friends of friends and their friends.” Thus, opinion leaders who advertise crypto products often receive a portion of the funds that people invited by them will pay for the product/service.
The relevance and effectiveness of the trend are confirmed by the fact that these methods are not only used by crypto startups, but also by the top cryptocurrency companies, widely known throughout the industry. A prime example is SatoshiLabs, a company that manufactures and distributes Trezor wallets. The head of communications, Iva Fizerova, confirmed that she is actively using affiliate marketing with bloggers as an alternative to paying them for direct advertising.
No less vivid examples are the largest crypto exchanges Binance and Gemini, which managed to succeed with the help of referral systems copied from the multi-level marketing campaigns of Avon and Mary Kay, which they have been using for decades.
Instagram blogger Chjango Unchained has been earning good bonuses for several months after posting a referral link to Gemini on her profile. When her subscribers register on the exchange and buy cryptocurrencies worth more than $ 100, she receives $ 10 in BTC. According to her, she is doing a good deed. The blogger wants people who are interested in her opinion on digital money to start their crypto path on Gemini, and not, for example, on Coinbase, because they charge “crazy commissions.”
Referral systems are a typical phenomenon for many crypto companies, and successful bloggers are happy to use this. A great example is Michael Gu, known as Boxmining. He has been distributing information about digital money since 2012 and has gathered an audience of more than 200,000 subscribers on YouTube and more than 3,500 participants in Telegram chat.
Even though the manufacturer of hardware wallets Ledger does not sponsor his activities, he places referral links in the video descriptions and collects voluntary donations from subscribers. As you might guess, he feels rather well. At the same time, the blogger emphasized that user activity during the coronavirus pandemic is only growing, especially after YouTube began to put legal pressure on creators of crypto content.
Gifts, Contests, and Giveaways
Making a small gift is a great way to introduce an audience to a new product. In the cryptocurrency market, this has been relevant for a long time already. Coin creators eagerly carry out airdrops and bounty campaigns, allowing the crypto community to test the new coin. A similar approach is popular in the beauty industry. Samplers of perfumes and branded magazines with smells have led many girls to buy full-fledged versions of the fragrance.
In addition to the cryptocurrency developers, a similar approach is also used by crypto companies in a different direction, which cannot conduct airdrops due to their technical features (for example, this is true for manufacturers of hardware wallets). Therefore, they organize more classic giveaways through social networks.
It is noteworthy that crypto brands in this area are sometimes even more active than cosmetics manufacturers. They work not only with trusted bloggers with many subscribers but also help to become less popular bloggers to grow. Therefore, they periodically assist them in organizing giveaways to attract subscribers who could potentially become new customers.
Iva Fizerova from SatoshiLabs confirmed that Trezor periodically helps partners to attract new followers through the distribution of gifts. Moreover, this approach brings excellent results. By working with the community this way, they have managed to sell hundreds of thousands of wallets. But most importantly, to build the reputation of the brand which is warmly greeted by the audience. And this effect is so strong that the company simply does not see the point in spending money on expensive traditional advertising.
Most importantly, despite all the problems of 2020, including the coronavirus pandemic, which severely hit the global economy and, therefore, people’s wallets, demand for products did not fall. This approach remains valid, while the percentage of successful conversions in traditional advertising has probably decreased. SatoshiLabs has reported that over the past three months, they have observed a steady increase in demand for goods. Moreover, they even had to solve delivery problems if only the buyers got the desired devices on time.
Is It Effective?
The cryptocurrency market relies on marketing strategies that have proven themselves in the beauty industry, which in the new field are no less compelling. Maximum efficiency is achieved with a killer combination of all three of the above methods. The best case when the founders of crypto companies themselves become opinion leaders. Just look at Changpen Zhao, the head of Binance, or Justin Sun, the project manager of TRON Foundation. Both entrepreneurs are bloggers with a massive army of subscribers and are personally engaged in the promotion of their brands, regularly rewarding their audience with pleasant gifts.
It’s easy to guess why industry leaders rely mainly on this type of marketing. Advertising products in the traditional way is expensive, especially for startups, which still don’t have attractive products with a good reputation. But more importantly, crypto products are quite complex themselves, so they often need detailed explanations that are difficult to implement in the framework of traditional advertising. Agree that selling a bottle of Fanta with a new taste is much easier than a hardware cryptocurrency wallet, especially since most people don’t understand what the hell is this. On top of that, regular advertising is complicated by the fact that media giants regularly block cryptocurrencies and related content.
In such a situation, marketing borrowed from the beauty industry seems to be the most acceptable and most effective option. By focusing on marketing budgets on opinion leaders and working with the community, crypto companies are able to achieve the desired result, even during coronavirus pandemic. The crypto community is becoming bigger and stronger every day. But the best part is that this growth cannot be stopped.
