We are aware of how ICOs have changed the way startups are funded and projects are developed. The marketplace is now a crowded bazaar of innovative ideas making it hard to stand out from the crowd. While some ICOs are incredibly successful, attracting the right investors and achieving the desired funds, others struggle to get off the starting block.
There are varying reasons for an ICO failure with marketing blunders being a major culprit. So, if you are an ICO creator, soon to embark on this roller coaster journey, make sure that you do not make these common mistakes.
Lack of a Simplified Whitepaper
Of course, whitepapers are usually studied by tech enthusiasts and investors. But, it’s wise to keep your marketing materials simple and easy to read. Your ICO will not benefit by using fancy words and obscure terminologies. You could have a disruptive technology at hand that would simply fizzle out if investors are unable to understand how it will work.
For example, take the ICO whitepaper of the Status network, an Ethereum-based mobile operating system, which managed to raise a little more than $100 million in its ICO. If you look at its 35-page whitepaper, you will see sentences like, “With Status your mobile device becomes a light client node on the Ethereum Network” or something like “The messenger form-factor is chosen to make Ethereum feel as familiar as possible to the average smartphone user.” An average smartphone user won’t understand these words, but someone with a technical background will. If you are aiming for such a niche audience, then this language is perfectly fine.
Absence of a Strong Team and Advisors
Unfortunately, the ICO space is riddled with bad players, and people look for credibility in the projects they invest in. Having a strong team, with previous backgrounds in conducting ICOs or developing blockchain projects, is helpful. Association with reputed advisors can give you a head start. But, it is not enough to just build a team and let them do their work quietly in offices. Experienced team players have to go out and address investors – after all, many people judge a project by how well team members are responding to questions either on social media sites or via face-to-face interactions. Investors have a right to scrutinise all details before parting with their hard earned cash and therefore it’s essential to work on how your whole team is portrayed.
Probably one of the worst ICOs of 2017 was that of OneCoin. They scammed investors of $350 million. Some of the core team members were linked to ICO scams in the past. Dr. Ruja Ignatova, Founder and COO, lied about her educational qualifications on the company website which is a big no-no in today’s ICO space where investors are becoming increasingly suspicious.
Failure to Leverage Groups, Forums and Social Media
A multi-channel marketing strategy offers advantages for ICO marketing. Ineffective community management will lead to poor results. If people are unaware of the upcoming ICO, how will it garner funds? Be it web traffic, amplification, impressions or engagement, every digital marketing strategy will serve a unique role in your efforts. If your community manager is not replying to investor queries even at the launch of your token, then the community will form a negative opinion about your project. The crypto world largely thrives on community loyalty and an upbeat community spirit. It is these communities that also affect market prices to some extent. Keep in mind that these communities are built up of people from all over the world, with the power to create good will about your project.
Failure to Communicate the Objective of the Token Launch
Why will investors put their precious money into a project that doesn’t serve any purpose? You have to explain your project’s fundamentals and the way the token will solve specific issues. Your whitepaper and website have to be clear about what the future holds too carefully detailing the underlying technology or protocol and the tokenomics. That is why the whitepaper has to be understandable, as mentioned earlier.
Then there are projects that don’t need blockchain at all. Not every idea can be tokenised successfully, and even if they can be, not all ideas can be converted into mature products. Take the example of Swishcoin; a hybrid shop-n-pay software for brick-and-mortar venues through PoS terminals. The idea was to increase effective floor space and reduce operational strain during peak times. This is a clever twist to an old idea. Now, after the ICO, they have not yet been able to come up with a wallet or webpage that actually works.
Something similar happened with the SpaceBit ICO, one of the most ambitious projects to date. They were planning to launch several nano-satellites in space, to provide a global-based access to blockchain. After 2015, all the hype faded, as the company failed to come up with any actual prototype or proof-of-concept.
Failure to Track Performance
You have to measure everything, right from conception to the execution of the project, so that you are able to continuously upgrade and improve on ideas. Many ICO teams do not have provisions for consumer feedback or do not pay attention to them. Only when you understand and analyse the key performance indicators will you be able to optimise marketing channels and create specific goals for the future. For this, every marketing plan should have measurable KPIs associated with it. Why throw things at the wall to see what sticks when we have so much data analytic abilities at hand?
To conclude, keep in mind that your team is perceived as technical innovators, so investors will have some strong expectations from them. Spelling errors won’t be forgiven; neither will tacky designs or an incomplete whitepaper. The ICO space is highly competitive, so make sure your marketing efforts are thorough, carefully planned and true to the nature of your project.