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As the fallout from the collapse of FTX (and BlockFi, and Serum, and....) continues to reverberate across the ecosystem, you will hear it said that web3 has a brand problem. As someone who leads brand and strategy workshops and trainings around the world, let me assure you that, when it comes to brand, the existence of a problem is about the only agreement you'll get.
Sure, people are generally clear that the failure to communicate Web3’s promises and value hinders mass adoption. The knee-jerk response, as a result, is that crypto just needs a good brand team to create some fancier words and prettier pictures. And with all the smart people who've gone into crypto the past few years, surely those words and logos are right around the corner...
“How does a decentralized, permissionless blockchain make this product better and more valuable to consumers than what’s currently in-market?”
Why a certain product or offer needs blockchain to begin with is like a marketing 101 question I ask whenever I look at different projects. And more often than I would like, the answer that comes back is not much more than a collection of web3 buzzwords that add up to nothing. Of course, people are quick to rattle off the usual collection of web3 “brand promises” technobabble. But scratch even remotely at the surface and it amounts to little more than hand-waving to impress the normies and/or distract from the absence of substance underneath.
Crypto and blockchain aren’t just enablers of the value. They ARE the value.
One of the fundamental challenges in today's crypto world is that the technology itself IS inextricable from the product such that the technology IS the product. This is where the disconnect happens between the web3 Technorati and normal people because, ironically, if FTX (and every other collapsing crypto Ponzi scheme) has shown us one thing, it's that most of the crypto world doesn't understand crypto either. But say say “gm!” on Twitter, have the right avatar, or wax philosophical about deflationary tokenomics, and you're in.
And therein lies the source of the web3 brand problem. To illustrate just how far from a brand most of these are, swap out blockchain for database and CRM for crypto. Now, picture Amazon's pitch in this world “leveraging the power of CRM and databases to deliver you the products you want?” I am only mostly joking ...
Yet, if you listen to too many web3 thought leaders, the blockchain is the brand promise. It doesn’t matter whether the market NEEDS a specific solution powered by a public blockchain. The simple fact that it is on a blockchain is the benefit. Whether it’s easier or faster or better or cheaper is irrelevant to the web3 diehards. What matters is that the old system is bad, the new system is good, and that should be enough. Also, it'll make you rich. Which is always a selling point. And a warning sign.
And this is the heart of the challenge that web3 is going to have to overcome if it’s going to go mainstream.
The brand that is web3 today is the brand that the early builders wanted to build in the first place.
In that way, the early builders were very disciplined and, frankly, very successful. Decentralization and inscrutability were what mattered. Fortunately, if history and general human behavior are any guides, they are not representative of the mainstream now, nor will they ever be. Which means that, when web3 does scale, it won't be the purity that the early builders imagined. Instead, it will be something else. And it will be completely rebranded, in the process.
There are already some projects that are starting to figure out how and why blockchain technology – with its transparency, decentralization, liquidity, and low-overheard – can be a game changer without resorting to added complexity for consumers. Physical infrastructure plays like DeWi are intriguing and seem to have a reason to be on a blockchain. The Starbucks approach, obscuring the wallet and largely hiding the blockchain entirely, is a glimpse into what's coming (I predict).
The rebrand is coming, and it will be based on the value being delivered, with the technology chosen to enable, not as part of a litmus test of purity. Will there be pure blockchain plays? Surely. But regardless of what it looks like, this much I can assure you. For those blockchain projects that don’t make that critical transition to value - I wouldn’t stake my coins on their chains.