In the rapidly evolving world of cryptocurrencies, gaming and gambling advertisements stand out as the most expensive method for onboarding users with existing crypto wallets. According to a recent analysis, the median cost per wallet (CPW) for these campaigns is alarming at $8.74, significantly higher than other sectors within the crypto industry.
The findings indicate that crypto gaming and gambling campaigns are not only costly but also less efficient at attracting users compared to decentralized finance (DeFi) and centralized finance (CeFi) campaigns. With a median CPW of only $2.79, DeFi and CeFi initiatives present a more viable alternative for reaching new crypto users.
Asaf Nadler, co-founder of a leading Web3 marketing firm, explains that the steep costs associated with gaming and gambling advertisements may stem from several key factors:
- Higher churn rates: Users attracted to gaming may be more transient.
- Speculative behavior: Many potential users may not be serious about long-term engagement.
- Intense competition: The influx of new gaming platforms further drives up acquisition costs.
This suggests that while the Web3 gaming sector has immense potential, a more effective user acquisition engine must be developed to sustain its growth comparable to Web2 gaming experiences.
Despite the high CPW, leading figures like Jeff Zirlin, co-founder of Axie Infinity, advocate for viewing these challenging times as opportunities. He encourages operators to leverage high CPW periods for experimentation, recommending:
- Create new games and product lines.
- Consolidate market share.
- Prepare for the next market expansion.
These strategies can help businesses navigate the tough landscape and enhance their long-term success in the crypto gaming niche.
The analysis reveals varying costs in different regions. Premium markets, while previously offering low-cost conversions during bullish phases, have seen drastic increases in CPW during market downturns. For instance, CPW in the US skyrocketed by four times, whereas Western Europe’s CPW increased by an astonishing 27 times between the first and third quarters of 2024.
Emerging markets in Latin America and Eastern Europe, however, present a different scenario. They offer exceptionally low CPW under favorable conditions, but could experience dramatic cost fluctuations that make planning challenging. Marketers need to tread carefully in these volatile markets to strategize effectively.
The complexity of user acquisition in the crypto gaming space necessitates innovative marketing strategies that are adaptable to the shifting dynamics of the market. As the crypto landscape continues to change, businesses must find ways to lower their customer acquisition costs while appealing to a wider audience.
