Numerous crypto companies are slashing their marketing budgets, despite the need to regain customer confidence in the asset class, which has fallen in recent months.
After spending millions on multiple ad campaigns and Super Bowl commercials, many businesses are now reducing their advertising dollars because of the continued market instability.
This year, prominent digital currency firms have reduced their expenditure on platforms like YouTube, Facebook, and Hulu by more than 90 percent.
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Crypto Companies Cut Back On Ads
Ad spending on TV has also been down: Crypto.com’s marketing expenses decreased to $2.1 million in May, from $15 million in November of last year, while Gemini’s marketing campaigned was cut back to $478,000.
The Journal article also cited a fall in the industry’s huge commercial spenders, including appearances by prominent Hollywood celebrities and sponsorships that would place big names on sporting arenas in Los Angeles and Miami.
The decrease follows a severe downturn in the bitcoin markets, which has significantly trimmed the market worth of cryptocurrencies by $2 trillion.
Ad expenditure has decreased as a result of the steep decline in cryptocurrency markets, which has slashed the value of cryptocurrencies by $2 trillion. Image: Money|HowStuffWorks.
Aside from this, the crypto exchange giant Coinbase has halted its advertising programs after spending more than $30 million in February. The company is among the hardest hit by the current dire market climate.
On top of the advertising budget reduction, Coinbase has also announced a recruiting freeze and an 18% employment cut.
Intriguingly, certain market participants in the field have argued that marketing operations must continue in order to remain competitive despite the market crash.
Mission: Win Back Consumer Trust
Currently, regaining consumer trust is the most critical factor for the crypto industry’s existence.
Andrew Frank, vice president and senior analyst at research firm Gartner, stated in a Journal interview that it will require a combination of advertising and other types of communication to “rehabilitate the image of the stability of investing in bitcoin.”
Dennis Yeh, an analyst with the mobile app monitoring business Sensor Tower, noted that macroeconomic uncertainty is a major contributor to the present bleak crypto environment.
Crypto total market cap at $881 billion on the daily chart | Source: TradingView.com
“When the price of bitcoin is low, app engagement and new clients are typically low as well,” he explained.
Pam Kramer, chief marketing officer of the crypto trading platform Voyager Digital, told the Journal, “there is still a great deal of information sharing to be done.”
Given Bitcoin and other related virtual currencies’ current market weakening, which affects even the largest firms in the field, this may be a tough assignment to undertake.
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Featured image from WorldMagazine NewsPaper, chart from TradingView.com