Go-To-Market Strategy in Web3. How to launch a Web3 project in 2024? Part 1.
Sep 4, 2023
The invention of Bitcoin in 2009 highly influences individuals nowadays, allowing them to change the interactions between people and organizations. We’re living in the era of significant transformations when tech nerds make history with big ambitions. Entering any market is challenging, and finding your perfect Go-To-Market (GTM) Strategy is not easy, especially in fast-growing niches such as Web3 and related fields.
In this article, I want to give an overall perspective on Go-To-Market Strategy in Web3 with examples and detailed explanations. Reading it is vital for the founders of early-stage startups, business and brand strategists, marketers, and all professionals interested in diving deep into the world of Web3.
First, I want to describe the types of businesses acting in the Web3 space. In 2023, I can name 14 as the most popular, but it’s not the final number. I’m sure you know some of them if you had any experience with cryptocurrency, NFTs, or blockchain infrastructure.
Many of them are Decentralized Applications (DApps), the companies built in the form of decentralized applications that run on blockchain networks. DApps can span various industries, including gaming, finance, supply chain, and social media.
Business models in Web3:
Blockchain Platforms: These companies are responsible for developing and maintaining blockchain networks and protocols. Examples are Ethereum, Polkadot, Solana, and BNB Chain.
Decentralized Finance: DeFi companies provide financial services and products without intermediaries, such as lending platforms, decentralized exchanges (DEXs), yield farming protocols, stablecoins, and liquidity pools. Examples - DYDX, Uniswap, 1inch.
Non-Fungible Token Marketplaces: NFT companies facilitate the creation, buying, and selling of unique digital assets, such as digital art, virtual real estate, collectibles, and in-game items. Examples - OpenSea, Blur, SuperRare.
Wallet Providers: Wallet companies offer secure digital wallets that allow users to store, send, and receive cryptocurrencies and NFTs. Examples - Argent, Safe, Metamask.
Oracle Providers: Oracles are essential for connecting real-world data to smart contracts on blockchains. Examples - Chainlink, Pyth Network, Band Protocol.
Blockchain Infrastructure and Development Tools: These companies offer tools and infrastructure for blockchain development, such as APIs, SDKs, testing environments, and deployment solutions. Examples - Alchemy, The Graph, Moralis.
Decentralized Identity: DID companies focus on providing self-sovereign identity solutions that give individuals control over their personal data and privacy. Examples - Nametag, Stripe Identity.
Blockchain Consulting and Auditing: Consulting firms advise companies and projects on blockchain adoption, strategy, and smart contract auditing for security and compliance. Examples - OpenZeppelin, Hacken, Quantstamp.
Decentralized Storage Providers: These companies offer decentralized and distributed storage solutions, allowing users to store data in a secure and censorship-resistant manner. Examples - IPFS, Filecoin, Arweave, Storj.
Blockchain Gaming Companies: Blockchain gaming projects combine gaming experiences with decentralized technology, often incorporating NFTs to give players true ownership of in-game assets. Examples - The Sandbox, Dapper Labs, Horizon Blockchain Games.
Decentralized Social Media: Platforms that prioritize user privacy, data ownership, and censorship resistance through blockchain technology. Examples - Mirror, Lenster, Bluesky.
Supply Chain and Logistics: Some companies in the Web3 space focus on providing transparent and traceable supply chain and logistics solutions using blockchain technology. Examples - IBM, Everledger, Syncfab.
Web3 Data Providers: Raw data and analytics for defining the valuable inputs and metrics such as new user retention, daily/weekly/monthly active users, user engagement, transaction volumes, and business KPIs. Examples - Dune, Token Terminal, Messari, DApp Radar.
Decentralized Autonomous Organizations (DAOs): DAOs are organizations governed by smart contracts and community voting. Examples - Friend with Benefits, Ukraine DAO, Bankless DAO.
Below is the picture from the blog post about the GTM on the a16z crypto website. The author, Maggie Hsu, offers such an approach to classifying projects depending on the level of their decentralization and the presence of a token in the business model.
According to this matrix, GTM differs in each quadrant and can span everything from traditional Web2-style strategies to emerging and experimental strategies. Here, I’ll focus on the upper right quadrant (decentralized team with the token) and contrast it with the lower left quadrant (centralized team with no token) to illustrate the difference between Web3 and Web2 GTM approaches.
Go-To-Market Strategy Components
After dealing with the main types of businesses in Web3, it is worth telling you more about the go-to-market. Many believe this stage is only about marketing and activities related to the media support of the new product's entry into the market.
A Go-To-Market (GTM) strategy is not solely about marketing; it is a comprehensive plan involving various aspects of a business to bring a product or service to market successfully.
While marketing is a critical component of the GTM strategy, it is just one piece of the puzzle. It's directly related to the company's Product Strategy, vision and mission.
The two main types of go-to-market strategies are sales-led and product-led:
A product-led GTM strategy uses the product to acquire and retain users.
A sales-led GTM strategy uses marketing to drum up interest for a product, capturing it in content and demo forms. In a sales-led approach, salespeople reach out to prospects to convert them into customers.
In Web3, the most common is a product-led GTM strategy because of the tech nature of the projects. Founders have developers' or product managers' experience, so they focus on creating products more than sales and marketing.
Regardless of the specifics of the business (Web2 or Web3), several stages make up the classic model of GTM. Later in the article, I will describe the features of GTM specifically for Web3 because there are differences from traditional businesses.
The essential components of the GTM for any business:
Market Research and Analysis: Conduct thorough market research to understand your target audience, their needs, pain points, and preferences. Analyze your competitors and identify gaps in the market.
Product Development and Positioning: Ensure your product or service is well-developed, tested, and aligned with customer needs. Define a clear value proposition and positioning that differentiates your offering from competitors.
Pricing Strategy: Determine the optimal pricing strategy considering your costs, competitive landscape, and customer-perceived value.
Distribution Channels: Identify the most effective distribution channels to reach your target audience. This could include direct sales, partnerships, e-commerce, or other distribution methods.
Sales Strategy: Develop a sales strategy that outlines how your sales team will approach potential customers, handle objections, and close deals.
Customer Support: Provide excellent customer support and service to retain customers and build loyalty.
Legal and Regulatory: Ensure compliance with relevant laws and regulations that may impact your product or service
Partnerships: Identify potential partners and alliances to help expand your reach or complement your offering.
Budget and Resources: Determine the budget required for the GTM strategy and allocate resources effectively.
Metrics and Measurement: Establish key performance indicators (KPIs) to track the success of your GTM strategy and make data-driven decisions.
Clear Roadmap: Plan the timing of your product launch, considering market conditions and customer readiness.
Feedback and Iteration: Collect feedback from customers and stakeholders to iterate and improve your GTM strategy continuously.
As you can see, the GTM strategy is a holistic approach that aligns all the moving parts of a business toward achieving the common goal of successfully bringing a product or service to market. It requires coordination and collaboration across different departments, from product development to sales, marketing, and customer support.
Most often, Web3 projects are startups despite the significant investment they receive from venture capital funds. All processes are turbulent, and many things are done for the first time in the industry, so some of the stages of GTM may be missing or implemented not as they should ideally — for example, Sales Strategy, Legal or Clear Roadmap. The main thing is not to lose focus and do what is essential for the product and the Web3 community.
In Web3, it is important to add some components to the basic list:
1. Deep knowledge of blockchain, cryptocurrencies and related topics. To create, launch, and develop a project for Web3, you and your team must know a lot about the blockchain ecosystem and how it works with classic businesses or AI. The lack of industry knowledge will limit you and your project in development.
To learn about blockchain technology and cryptocurrency, DeFi and trading, staking and farming, airdrops and testnets, L1 and L2, zk-rollups and optimistic rollups, and other tools and features of the Web3 world, you have to read and watch a lot of content.
Every day, I read Twitter and Linkedin news from the TOP influencers and Web3 founders as @koeppelmann, @VitalikButerin, @gluk64 and @StaniKulechov, connect with people on Discord chats, follow projects that impact the community, watch shows like Bankless, listen to Web3 Podcast by a16z, read articles on HackerNoon and Mirror, and much more.
This industry is moving so fast! Follow the news, read blogs, watch videos, and attend events to stay up-to-date.
2. Tokenomics. It considers the economics of a crypto token: issuance, attributes, distribution, supply, demand and other characteristics. When launching a project, founding members and developers need to consider the tokenomics of their native cryptocurrency carefully if their project is to attract investment and be successful.
Tokenomics is also an important part of the pitch deck for investors because it gives an understanding of the project’s logic and perspective.
Here is an example of LIDO’s tokenomics and distribution of tokens:
3. Community Building. It’s vital to any Web3 project, especially if you build for the B2C audience. Engage potential users and supporters through social media, forums, and online events. Encourage participation and reward early adopters to create a sense of ownership and loyalty.
When building a Web3 community, it is important to establish clear and specific goals. This involves conducting research to understand your audience and working with internal and external stakeholders to identify the most pressing needs that the community can assist with.
By aligning community goals with project goals, you can ensure that community behavior is directed toward achieving those goals.
Some projects manage to reach many people in the community and involve them in developing the project and disseminating information about it. Below, I show screenshots of social networks of projects that have maintained high interest for a long time.
Here is a collage with the number of subscribers and some online and offline activities of the zkSync project:
4. A powerful technical infrastructure that allows the implementation of highly loaded solutions. You may not have the necessary servers or cloud storage at your disposal, especially in the early stages of the project. If your project needs technical resources, you should find them and involve external providers.
As a result of reading this article, you learned about the types of business models in Web3 depending on their specificity and functionality. Also, you learned about the classic list of items needed to create a GTM strategy and the features of this strategy for Web3 projects.
Strategy is impossible without implementation, that is, without specific tactical tools and activities. In the following article about GTM Tactics for Web3 products, I list Web3 companies' activities to market and attract more users and partners.
Suppose you found this article valuable for you, like it and share it with your colleagues and friends interested in building a Web3 product strategy.
Drop me a line at email@example.com to discuss your project and its potential in terms of brand building and communications.