How to Increase the Market Capitalization of a DeFi Startup by 300% in Just 5 Months

As it turns out, yes. That’s exactly what the team of BDCenter Digital did for a DeFi client — and with very tough marketing KPIs at that. The key to success? A careful study of the target audience and an integrated marketing strategy.

Disclaimer: market cap growth was achieved thanks to attracting new users and promoting the sales of the coin as a long-term investment, and not thanks to increased speculative sales.

The objective: increase the market cap of a stablecoin

Market capitalization is one of the key metrics for any blockchain or DeFi (decentralized finance) projects. It’s calculated as the total market value of the tokens or coins issued by the project. Up-to-date market caps for most crypto assets are available on the CoinMarketCap website.

In this instance, we worked with a platform that issued its own USD-pegged stablecoin. Both the coin and the platform were decentralized, and the initial market cap was around $11 million. Our task was to increase the sales of the stablecoin, and therefore its market cap. The client set a very stringent marketing KPI: each $70 spent had to turn into $1,000 in new stablecoin sales.

Step 1: audience and product research

There are three aspects to any project that you have to research before embarking on a marketing campaign: the product, the competition (including the marketing strategy of one’s rivals), and the target audience. The product and competition analysis allow you to formulate the USP (unique sales proposal), while the audience research helps draw up a customer profile.

In our client’s case, the USP was quite clear. Users could buy the stablecoin with a bank card and immediately deposit it in staking. The yield was high and paid on a daily basis; in addition, one could always withdraw the stake without any penalty.

As for the target audience (TA), we divided it into 4 groups based on the average sale size, and then conducted over 30 in-depth interviews, lasting up to 1 hour each. Already at this early stage, we discovered a potential issue with the USP: the customers felt that the annual staking yield wasn’t just high, but suspiciously high. Eliminating these suspicions and fears would be one of the priorities of the marketing campaign.

Step 2: targeted ads in Google and social media

When promoting a cryptocurrency project, you have to deal with the fact that Google and Facebook have officially banned crypto-related ads. In the case of Google Ads, you can circumvent the ban by following a few rules:

Don’t deposit more money into the account than needed for two days’ worth of ads. If the account gets blocked (and it probably will), it can take time to get that money out.

Submit an appeal as soon as the account is disabled by the moderators. In 70% of cases, an appeal is enough to unblock the account. If it doesn’t work, you’ll need to move to a new one ASAP.

Delete all the content that didn’t pass moderation. If you don’t, the moderator might take notice of all the discarded ads next time and reject your new content, too.

In the end, the Google Ads campaign generated almost 4 thousand new users. Branded search queries produced the best results, with a conversion rate of about 30%.

We had much less luck with Facebook, which kept blocking our ads. We even designed a new landing page that didn’t contain words like ‘cryptocurrency’ or even ‘BTC’. However, conversions turned out to be too costly, so we had to stop advertising the stablecoin on Facebook altogether.

On Twitter, we decided to try a different technique: a contest with a relatively large prize fund. To participate, users had to purchase a specified minimum number of stablecoins with a credit card. The contest was promoted through targeted ads and attracted a lot of attention, but far from all the participants ended up making a purchase. The reason was a convoluted KYC required by the payment system. The competition did pay for its costs, but the results were still far inferior to those produced by Google Ads and Vkontakte (see below).

Insight: when using contests as a promotional tool, you need to make sure that the customer journey is simple enough both in terms of the contest rules and the way they are implemented.

By contrast, the Russian-language social network Vkontakte produced very good results. The campaign period coincided with manifestations in Belarus (one of the target countries), and we managed to use that — this is known as situational marketing. While Belarusians rushed to the banks to withdraw their deposits and convert them into cash USD, we phrased our VK ads in such a way as to stress the stablecoin’s stability and high yield, calling it a digital dollar. We used taglines like ‘Can’t buy any USD in Belarus?’ and ‘Belarusians are switching to digital dollars’.

Insight: situational marketing is an efficient tool that can produce affordable targeted clicks. Keep monitoring the events in your target regions and formulate the CTAs accordingly. In this campaign, the financial crisis in Belarus turned out to be a good hook on which to ‘hang’ the ads:

Step 3: influencer marketing

We work with influencers on YouTube, Telegram, and Twitter. For this campaign, we selected bloggers and vloggers with a lot of followers in the CIS, North and Latin America, Spain, Germany, Singapore, Turkey, and India. The 4-month influencer campaign produced the following results:

360 thousand views is an impressive number, but what we were really interested in was the stablecoin’s market camp. In this sense, the campaign was also a success:

These results became possible thanks to the use of four techniques:

1) A/B testing. We frequently changed the brief (scenario, headline, CTA, etc.) to make sure that each vlogger’s video is different. Some changes were particularly successful: after we switched to a different title, conversions grew by 10%, and a change to the scenario produced an increase from 15% to 24%.

2) SEO. All the elements of a video — title, CTA, description, and tags — were optimized for the relevant search queries, including YouTube search.

3) UTM tags. The use of UTMs allows you to evaluate a video’s effectiveness by tracking the number of users who visit a website after clicking on a link under the video. Of course, many visitors will arrive at the site by using other means — for instance, direct Google search for the project’s name. Still, UTM tags provide useful statistics.

By the way, some of the opinion leaders promoted their videos themselves — for instance, by organizing a $50-$100 giveaway for those who subscribed, commented, and liked the video.

Insight: the influencers generated a much better response in Latin America than in Russia. It’s a well-known fact that users in Venezuela and other Latin American countries actively buy cryptocurrency to protect their savings during periods of high inflation. By contrast, even though the Russian rouble depreciated a lot in 2020, too many Russians have a negative experience of losing money in various Ponzi schemes, making the promotion of crypto projects quite difficult.

By the way, US users showed a strong interest in the stablecoin, though they couldn’t fully benefit from its functionality due to the regulatory restrictions.

Step 4: working with the media

Free placements

In order to be featured for free on a crypto media platform, you have to offer it an expert article that its audience will actually want to read. It can be a commentary on the latest events, forecast, in-depth analysis of a technical subject linked to your project’s theme, or a how-to guide.

We prepared a series of explainers about staking and stablecoins, a profitability comparison, a ‘How to buy BTC with a credit card’ guide, and more. Each article contained a native mention of the stablecoin.

We obtained 13 free placements in such major media resources as Seeking Alpha (26 MAU), Before It’s News (4 MAU), and Hacker Noon (2.9 MAU), for a total of 6,000 unique views.

Paid placements

For several years now, We have collaborated with PR Newswire — a global press release distribution network. Publishing a release costs around $1,500, but you can expect dozens of other media to reprint it. In our case, the release was eventually featured on 150 websites from across the globe:

Insight: you should customize your visuals and headings depending on the target country. For example, when preparing an article for a Turkish website, we used a mostly red image (red is Turkey’s national color) and the word ‘very’ in the headline, since Turks are known to be emotional and say ‘very’ a lot. As a result, the article received twice as many views as an average feature on the same website.

Insight no.2: small websites often generate more traffic that big ones, because they also promote their articles in their own social media accounts.

Search Engine Optimization (SEO)

Users tend to prefer those projects that are frequently mentioned in the search results in a positive key. Thus, quality SEO can help increase conversions by 40% and even up to 80%, based on our experience.

In this particular case, promoting the articles about the project based on its title was difficult, because there was another organization with a very similar name. As a result, 80% of the Google and Yandex search results for branded queries were irrelevant.

To solve the problem, we used a creative integrated approach to SEO:

1) Working with transactional search queries. We selected a group of low-competition, low-frequency keywords and drew up a list of the top-ranking articles about blockchain staking. Next, we got in touch with the respective media and asked to insert short fragments of text (usually a single paragraph) mentioning the project into those articles. The strategy was a success:

2) Working with high-competition and veiled branded queries. Google’s algorithm prioritizes variety: the results will usually include articles, social media pages, business directories, etc. We decided to create profiles for the project on various startup aggregator sites, such as Crunchbase, ProductHunt, and GitHub. Some of them ended up ranking in the top 10.

3) New content. We published new articles on several trusted and popular blogging platforms, such as Medium, Tjournal, VC.ru, and Yandex.Zen.

Insight: though Yandex.Zen bloggers can’t boast a large audience, their Russian-speaking followers tend to be highly loyal. This can result in a surprising amount of traffic.

Step 5. Optimizing traffic and conversions

1) Ad budget reallocation. We discarded those advertising channels where the cost of a single conversion exceeded $15 or where the conversion rate was below 12%. These included Yandex. Direct, banner ads on crypto sites, and most ad networks. The money thus saved was reallocated towards Google ads, the A-ADS network, Twitter ads, and influencers.

2) Telegram chatbot. Our client did not use email marketing, because users didn’t have to provide their email when registering on the decentralized platform. The chatbot provided a great alternative: we could establish direct communication with users and tranquilize those who were worried about the suspiciously high staking profits. We created a series of new texts for the bot, explaining in a very simple language how the stablecoin worked (protocol, staking yield, security, etc.). The bot would also notify users of the latest project updates.

In just three days, 2,000+ users subscribed to the chatbot.

Step 6: website optimization

Even if a website looks good and works well, it doesn’t mean that it shouldn’t be optimized further. There is always a way to increase conversions by improving the UX, though the right solutions aren’t always obvious.

Our work on the client’s website followed the A/B testing format: after each change we would measure the result, comparing it to that in the control group. The changes produced an increase in conversions in 90% of cases.

We simplified the registration process, changed the headings, swapped content sections, and added a new FAQ and tooltips, as well as created three new landing pages in different languages to explain the stablecoin’s advantages.

Insight: when working on site optimization, it’s worth completing the customer journey from start to finish. This will allow you to discover the issues lurking on various stages, from registration to payment. For example, we found out that when buying stablecoins with a bank card, the payment system’s page (operated by AdvCash) displayed very confusing instructions.

The customer was asked to enter the email address they had used to register in AdvCash, and the email field couldn’t be left blank. Those who didn’t have any AdvCash account didn’t know what to do and would simply abandon the purchase. We notified the client about the problem, the client got in touch with AdvCash, and the payment interface was soon fixed.

Step 7: large investors

The client prioritized ‘whales’ — customers who would buy and stake at least $50k in stablecoins. We included a few of these investors in the initial in-depth interview group in order to find out what could motivate them to make such a large purchase.

As it turned out, VIP customers suffered from shallow order book liquidity on the trading platform. Filling a large order could take time, and all the while the price would keep changing. This slippage resulted in losses for the ‘whales’.

Our solution was to create a decentralized OTC platform. Large investors would be guaranteed a fixed exchange rate (1 stablecoin = $1) when buying at least $50k worth of stablecoins; fast or even instant processing; infinite liquidity; and the assistance of a dedicated manager. Moreover, we created an email sequence designed to engage ‘whales’ in dialogue and encourage them to invest.

Two weeks later, the OTC service was launched, and the results were quite dramatic: in just 1 month, ‘whales’ invested $1.2 million in the project.

Results

The task set before us was complicated. The coin was just 3 months old, its level of marketing activity was near zero, and the project’s name was very similar to that of a completely different business. What’s more, every $70 we spent on marketing had to yield $1,000 in stablecoin purchases.

We didn’t just meet the KPIs but managed to boost the monthly stablecoin sales using cards by a factor of 5.5. In the final month of the campaign, users bought over $1.87 million worth of the coin.

However, the most important result was the 4-fold increase in the stablecoin’s market cap: from $11m to $42m. This success became possible thanks to an integrated marketing strategy that included TA research, SEO, targeted ads, expert articles, company profiles on aggregator sites, influencer marketing, video optimization, usability improvements, and much more.

Of course, this method is far more complex and time-consuming than using only regular banners or sponsored articles. However, competition in the fintech industry is so fierce that only a truly integrated strategy can produce a lasting and tangible effect.