Brand building in web3 is taking on a broader remit. Tokenomics have paved the way for new incentive models. This means there are more audiences to consider besides just the end user. This requires companies to communicate much earlier in the business or product lifecycle. The opportunity here is for web3 native companies, particularly protocols, to find new and powerful ways to combine these economic models with engaging brand narratives.

Different mechanisms of growth

Web 2.0 startups would traditionally track to something like the below framework as they grow, where the green line demonstrates the fidelity of the product over time and the yellow line is the company's focus on brand and marketing of that product. 

Start small, iterate until product-market fit, then scale. Scaling is when the brand machine usually kicks in (the yellow line). That usually involves positioning work, brand guidelines and a marketing campaign that probably looks quite similar to other web 2.0 companies (see my take here for a deep dive).

Web3 is different, particularly for tokenized projects. a16z's Ali Yahya's network flywheel is a useful starting point:

Of course, there can be more nuance to what we see here, but even two years after he released this, it still holds water.
When we think about where/when the traditional marketing approach would insert itself, that would be centered around End Users: "Hey, we've made this thing, come and use it". 

However, the reality in web3 is much different, especially if you're building a protocol. The reason for this is that we're not just marketing to the End User. As outlined in Yahya's network flywheel, we have additional stakeholders to consider, all much further upstream. These are Validators, Delegators, Retail Investors and 3rd Party Developers. These are the early community members who invest in the protocol's token and contribute towards its growth. These participants are critical to building the value of the network through their engagement, whilst at the same time, being the source of production capital. Those audiences, by investing in your protocol's token, are literally buying into the vision of what you're doing. They are doing so with the expectation that:

• The token value will appreciate over time

• The token can earn significant interest or yield

• The token will have utility beyond the existing ecosystem players

In the early days of a project, for the network participants to feel like the protocol's team is tracking towards these points, they demand updates. Updates on where the team are in their dev and what the roadmap ahead looks like. If they lose confidence, they sell. The challenge is that complex systems take time to build and refine. There is a need to consistently reiterate the vision, maintain trust and build optimism into the network ahead of have a fully operational ecosystem. This is the 'vision alpha' - the difference from where the community stands today, to where it's going and how it'll get there. You'll notice that compared to the earlier chart, the focus on brand is much earlier in the lifecycle of the project - a long time before something functional exists.

Today, progress is often communicated to the community with Discord, Twitter or Telegram updates, perhaps accompanied by the occasional research paper. This is standard for when you're building a project with real world impact and utility. Straight up updates, facts, progress. Therein lies an opportunity: that approach is project management, not storytelling.

We don't have to divert our eyes far to find good examples of storytelling for pre-launch products. It's crucial for PFP / NFT projects. These drops can be infused with creativity, suspense and problem solving. Ordinarily because their utility is extremely limited, especially early on.

RTFKT, a virtual goods company, are masters of this. Take their MNLTH Quest as an example. Community members were airdropped NFTs of a curious nature. After some time, cryptic clues were dropped around a challenge. Once community members solved the problem, certain items or spaces were unlocked, triggering the next phase of the quest. A web3 treasure hunt. The Quest is a pre-defined narrative structure, controlled by RTFKT, that delivers the feeling of real-time gaming that harnesses true collaboration between members.

There are other examples of NFT world building that leverage community co-creation. These are less defined, more organic. Token holders take part in building the narrative and contributing to its direction. Loot is a collaborative media project that aims to create a decentralized, sci-fantasy universe, rich with stories, games and multi-media. A good example of co-creation is Loot's Open Quill Foundation - a grants program to encourage storytelling and creation in Loot.

So why am I talking about fictional NFT world-building and protocol growth in the same breath? It all comes down to leveraging all possible points of interest in your project. How can you manage and grow a community in a manner that sets your project apart, whilst communicating your progression towards an aspirational goal?  Consider creating a strategy that sits at the intersection of Tokenomics (financial incentives), Vision (the project's bigger objective or purpose) and Engagement (creating and maintaining community interest through entertaining and/or educational content). Most projects sit neatly between 2 of these 3 areas. Few hit the bullseye.

And yes, Loot and RTFKT are just made up things in made up worlds. But they shouldn’t be too easily dismissed. Even if you’re building a ‘Layer 2 protocol with cross-layer interoperability that's going to revolutionize e-commerce’ or something as important-sounding as that… then even better. You've actually got something to talk about. Storytelling can be as compelling, if not more, when rooted in the real world. Lean into that, but think beyond just writing white papers and dropping factual updates on your Medium blog.

Some suggestions:

How can you educate about what you're doing, unravelling complex concepts in an engaging or immersive format?

Can you paint a vision of the world your team is building for, communicating this in a creative way? (hint: not icons or diagrams)

Where are you on your roadmap? Can you bring progress to life in a manner that builds trust in your team and optimism for the future?

Before web3, brands needed to vie for users' attention - an interruption based model. But now, ownership and the promise of financial gains has hacked the system. Users are directing their attention (and capital) to projects that stand out in a cluttered and noisy environment. The projects that stand out are the ones that align with what the user is looking for: returns, engagement and being part of something bigger than themselves.