This post is taking part in the Nouns x Kiwi writing contest. This post is also part of a series about Open Money and originally appeared as part of the Open Money newsletter.
If crypto is a new system of participatory capitalism, then web3 offers a new form of participatory marketing.
OK, what?
Pre-internet, mainstream marketing was generally considered mass marketing.
Think billboards, magazine ads, and cable TV. Creative directors were tastemakers and brands thought about the number of eyeballs seeing their stuff.
Web2 made marketing more precise.
Think of ad targeting and tracking. Sometimes ads feel customized and well-time, other times it feels like someone is constantly watching over our shoulder.
In the web2 model, algorithms became tastemakers and brands became overly concerned with impressions and conversions.
Either way, and up until now, marketing was defined by one-way communication.
People on the other side of advertising budgets are making decisions about what we see and what actions we should be taking.
That’s how we got to where we are now.
But marketing-wise things are changing with web3. The biggest shift is the idea that connecting people with goods, products, and services doesn’t need to be so one-sided.
What is working, if the project known as Nouns is any indication, is the idea that the openness of the internet can be leveraged to create new kinds of marketing right along with new kinds of community.
Nouns as a case study of participatory marketing
Nouns was launched in 2021. At its core, Nouns is a decentralized autonomous organization (DAO) built on Ethereum.
The DAO is responsible for creating a new algorithmically-generated Noun character every 24 hours.
The characters are sold as non-fungible tokens (NFTs) and the proceeds generate a treasury. Each Noun holder also gets a vote on how funds from the treasury are spent.
So far, Nouns-funded projects have been all over the place including art projects and building skate parks.
If the goal of web3 is to build a more open internet, then the underlying structures of how information is created and controlled will also need to change.
Looping back to crypto — we are starting to see what the difference between public and private money looks like (we got into this concept in the recent central bank digital currency post) and what some of the regulatory ramifications might be.
In order to truly build an open internet, other traditional power structures will also have to change.
Rather than having traditional corporations shill goods and services across new onchain platforms, web3 native companies understand that the value of their interactions will come from a network.
Here are five features that help Nouns build a brand-as-community style projects:
Open source ethos. Open money and the open internet should be built with open-source tooling and principles. What we’ve learned from earlier web3 projects is that calling something open and being open are two different things.
One of the most striking things about Nouns is that it has relinquished strict control over its brand and actively encourages sharing, blending, and re-mixing brand assets.
Rather than a limitation or a liability, by encouraging spin-offs and derivates, Nouns are fueling growth and brand awareness. This is especially true in an increasingly meme-driven world.Community of creators. When we think of traditional brands we often think of brands as storytellers or brands as creators, and people as, well, consumers.
Nouns flip this idea on its head by using a decentralized autonomous organization or DAO as a means of getting creators and people involved in the community.
By purchasing a Noun, consumers have a voice in governance and a say in how the Nouns’ treasury is used. A Noun is both a unique collectible and it’s like a ticket to the show and a backstage pass all in one.
In traditional companies, the shareholders, the brand creatives, and the consumers are all very distinctive and separate roles. Not so much with a project like Nouns.Sustained engagement. New Nouns drop daily. This creates an opportunity for constant engagement, but it also makes the brand accessible.
If you missed your shot to own a Noun today, then there’s always tomorrow. This consistency and routine make it possible to keep moving into new audiences and bring new people into the Nouns fold.The virtuous cycle. Talk to any good business operator and eventually the conversation will return to flywheels. The basic idea is to create a product or service so good that it sells itself.
This works with widgets and gadgets, and it works with onchain experiences. The thing about Nouns is that by ceding control to Nouns holders, the project creates a flywheel of new ideas, new people, and new energy.
This newness has value.
But it also provides value to previous Nouns holders and project participants. As a bonus, the idea of collective good or public good also encourages new input, which creates new activity, which fuels the flywheel.
Part of what makes Nouns work is a sense of engrained play and purpose combined with basic tokenomics.
The result is a sensible cool that people want to share.
Where do we go from here?
The internet, or web3 more specifically, is not unfolding in a vacuum. As the world around us feels more fragmented and divided, it makes sense that people will want to find new kinds of communities in digital spaces.
My guess is those communities won’t flourish under the mass media or algorithmically-driven models of brand or digital space-building that were popular up until now.
Instead, good web3 practices, including marketing will take advantage of open-source technologies and practices to create co-ownership of creative experiences and outputs.
If it works, good web3 marketing should feel less transactional and more about a shared sense of mission or purpose.
Put another way, the future of marketing is less about cleverly defining brands and protecting images and more about the composability of products and identities.
A good marketing campaign will no longer be about eyeballs reached or clicks received, but about how well-woven a project can become into the broader internet culture.
