I said I was going to share those 4 reports in the last piece, but I was so deep on the ThreadGuy x Opepen story that it only felt right to leave it at that.
I promise (I think?) Iâll get to it. After all, I love to ramble.
Pudgy Penguins at Comic-Con
I covered the Pudgy Penguins toys launch a couple months ago and the companyâs presence at the Licensing Expo last month.
Some social stats, which have grown considerably since I last reported them:
The top Instagram reels have been viewed 43 million, 31 million, and 15 million times thanks to the broad appeal of the content
Pudgy Penguin GIFs have 5.1 billion views
Pudgy Penguins TikTok has 77k followers and 2 million likes and acts as an additional funnel to the Instagram account
The team continues to pierce the mainstream veil and is at Comic-Con this week. Comic-Con is an ideal event for Web3 consumer brands to appeal to a complementary audience. Over 135,000 people attended the conference last year and there is a strong collector culture.
The penguin claw machine continues to be a hit and is a replicable tactic that all consumer web3 brands should consider. Itâs a high emotional ROI investment for everyone involved.
What caught my attention even more is that the Pudgy Penguins IG account shared a video yesterday:
Pudgy Penguins on Instagram: âTag someone who needs to buy you a Pudgy Plush đ„ș𧞠Just click the link in our bio!â
July 19, 2023
Whatâs different about this video compared to all the other ones?
This is the first video that promoted Pudgy Penguin toys. The shop link was always in the bio, but just hung out there. The team has decided that it was time to warm up the IG engine and time it with Comic-Con. If we were to break this down into an oversimplified marketing plan:
Instagram is the first ânon-web3â channel that has been turned on. With the initial wave of purchases coming from the Pudgy community and broader web3 space back in May, the team is now able to have a better idea of the incremental impact of driving IG traffic to their Shopify store. As Iâve called out before, this was intentional:
Luca shared more insight about this decision and confirmed that this was intentional. Itâs hard to run clean split tests, and going from 0 to 1 provides the best environment for truly understanding the impact of specific audience segments and/or channels.
Pudgy Penguins focused on their community and Twitter as their launch channels. As a result, the team is able to measure the sales impact from the web3 and NFT community.
After that point, itâs easier to understand sales volume attributed to the amazon ranking algorithm, and then each of the other channels (eg: Instagram) as they are activated.
In a Twitter Spaces, Luca estimated that ~85-90% of the current sales are attributed to web3-centric consumers. Over time, those numbers will shift towards a more diverse consumer base as other channels, distribution partners, and marketing spend turns on (theyâve spent $0 on marketing so far!).
They could also slice the metrics in a variety of ways as each of these channels is turned on and and transitions into an evergreen channel:
How many orders does each Instagram post drive?
How does a video about the toys perform vs. only adding text in the caption?
What is the AOV (average order value) of a user coming from each channel? How does that differ between web3 and non-web3 audiences?
How are sales impacted before, during, and after events like Comic-Con?
How are sales impacted in a blitz approach vs. a single (or 2, 3, etc.) channel?
Considering the depth of their e-comm experience, the team likely has hypotheses that will be proven true or false and will double down on what works. Eventually, theyâll have a strong understanding of each of these channels as it relates to sales, their respective audiences, and potential time-based events (eg: first IG post promoting toys, an announcement during the holidays, etc.) that they can attribute sales to:
Note: Layer cake charts are typically for subscription businesses, but this is a nice way to illustrate what happens when channels get âturned onâ sequentially vs. all at once.
On a separate but related note, Luca Netz was a guest on Jason Yanowitz's (founder of Blockworks) podcast. Because none of us has time to listen to another podcast, 0xjaypeg provided a great summary of the episode, which I encourage you to take a look at. And for those of you that donât have time to click on another link, hereâs the TLDR:
NFTs are the bottom of the funnel, and Pudgy Penguins is working to widen the other end: Top of Funnel
As the top of funnel grows and market conditions improve, interest in NFTs will come back and Pudgy Penguins will be positioned well to capture the renewed attention and interest
The team is focused on building an IP house focused on the relevance of these penguin characters. Licensing the IP is critical for relevancy.
The company is on track for $6-7M in revenue this year, with ~half from physical products. Burn rate is less than this amount, so the company is already on track to be profitable đ
The team is 40 people
Pudgy Penguins werenât the only web3 consumer brand represented at Comic-Con either.
Cool Cats
The Cool Cats team brought back the Milk Bar that was first introduced at NFT NYC.
0n1 Force
The anime brand showed up with AR swag and stickers.
Assuming the trend continues, I expect that weâll see a lot more web3 brands show up in force.
Do you think Iâll share those 4 reports? If you do, share this with someone. If you donât, share this with 100 people.
McDonaldâs đ€ Sandbox
This isnât quite the McDonaldâs web3 campaign I pitched recently, but itâs something. Earlier today, Animoca Brands announced the McNuggets Land experience in The Sandbox, in partnership with McDonaldâs Hong Kong.
The experience takes players on a series of mini-games and quests. Users that complete the quests share a prize pool of 100,000 SAND (1 SAND = ~$0.43), and Hong Kong users that complete all the quests are entered to win a yearâs worth of free Chicken McNuggets or a free 6 piece Chicken McNuggets coupon. The physical prizes are key, and itâs good to see that the campaign has incorporated real-world outcomes in this campaign.
Is this an early sign of larger initiatives on the horizon? Possibly, though itâs important to note that this is McDonaldâs Hong Kong, operating in a region that has higher affinity to web3 from a demographic and regulatory standpoint.
4 reports on the state of Crypto/Web3
We made it! There have been some reports published recently that show various angles of the state of the industry that are worth sharing.
Consensys: The State of Web3 perception around the world
Consensys partnered with YouGov to conduct a global web3 perception survey. The company surveyed 15,000 people in 15 countries and 9 languages to get a better understanding of how crazy we really are đ€Ș
Some aggregate highlights:
83% think data privacy is important
79% want more control over their identity on the Internet
67% believe they should own the things they make on the internet
92% have heard of crypto
The top association with crypto is that it represents the future of money
24% are aware of the concept of web3
The survey results are broken down by country as well as age group, which show the regional and generational differences in perceptions of the space.
Electric Capitalâs Developer Report Update
Electric Capital shared a mid-year update on the state of developer activity. Some highlights:
There are ~21,300 active developers in the crypto ecosystem as of June 1, 2023. This number is:
-21% vs. 2022
+25% vs. 2021
+92% vs. 2020
The developers are broken out into 3 categories:
Newcomers: < 1 year in crypto
Emerging: 1-2 years
Established: 2+ years
The decline in crypto developers over the past year was from newcomers, which was also the largest segment of developers. Over the past 12 months:
-48% in newcomers
+44% in emerging
+2% in established
Although the drop in developers over the past year looks scary, digging into who these developers are provides important context. Established developers are here to stay and do what they do best: build đïž
Shoutout to Enrique for creating and maintaining such a valuable resource and for being a longtime subscriber!
Superdaoâs Wallet Growth Trends Report
The web3 wallet analytics company shared a report on wallet stats:
There are 360M wallets across Ethereum and Polygon as of June 2023
32.6M have transferred at least 5 different tokens at some point
5.91M possess 5 or more NFTs
8.91M maintain a balance of $100+
9.51M have conducted at least one outgoing transaction in the past 30 days
5.65M have spent money in the last 30 days
These are BIG numbers, and it is encouraging to see the number of wallets on Ethereum and Polygon alone.
However, wallets are an elusive (but still valuable) metric. Similar to e-mails, one person can have multiple wallets, and many of them are inactive.
If you use any of the stats in the report, I encourage you to understand Superdaoâs measurement methodology at the bottom of the report.
Ethereumâs Q2 â23 Earnings Release
No, Ethereum is not a public company (phew!). However, Sam Andrew, a crypto investor, analyzed the blockchainâs stats and turned them into financial statements. Some highlights:
DAU (Daily active users): -4% QoQ, -3% YoY. Daily user activity continues to drop, but is decelerating from the depths of the bear market last year.
DAU on Ethereum has been stagnant, but DAU in the broader Ethereum ecosystem (Arbitrum, Optimism, Polygon, Starknet, zkSync) has doubled. This doesnât necessarily mean total DAU has grown, but rather, the ecosystem is seeing more of those same users across these different L2s.
Ethereumâs âgross marginâ was 84%, meaning 84% of network fees generated (gas fees from transactions) were burned
Great interpretation of a blockchainâs performance for the financially savvy.
There you have it folks, I shared the 4 reports! If you doubted me above, be sure to share the newsletter to 100 friends đ
See you next week!
