Image credit: NFT Now "Web2 Media Is Broken. The Future of Media Is Tokenized"
What's the trend?
Tokenized media envisions more community-centric models that redefine the audience-publisher-advertiser relationship in a web3 environment.
Tokenized media brands are offering consumers ways to freely ‘collect’ content they engage with, earning loyalty points in the process, as well as selling NFT access passes that can act like a paywall, but can also enable additional token-gated benefits both on and off their own platform.
Simultaneously, these brands are opting out of onsite programmatic advertising and cookie tracking in order to better align incentives and trust with their community. The vision is a more engaged, loyal and monetizable community for media brands as they look to diversify revenue away from obsolescing Big Tech platforms.
Meanwhile, the consumer is rewarded for their engagement, participation, co-creation, and data.
What’s fueling the trend?
To fully appreciate the tokenized media opportunity, we’ll quickly recap the push & pull drivers:
- After transitioning from programmatic ads to subscriptions over the past several years, web3 is the next evolution in direct-to-consumer media models.
The ROI on programmatic advertising doesn’t work for publishers and consumers. Most tech-forward publishers are prioritizing direct-to-consumer revenue models through subscriptions, as their next lever for growth. Media subscription offerings today are binary, the consumer pays monthly for an access tier of content (i.e. number of articles, unlimited access). There’s little imagination and minimal consumer incentives for engaging with the content, even participating in the editorial process itself. Direct-to-consumer models have to prioritize the consumer engagement layer to secure retention and drive LTV. Tokenized media is the next generation of DTC media.
- Web3 enables consumers to engage with publishers with more intentionality and relevancy
Programmatic advertising works, in part, by using web2-era cookies to track consumer behavior across different websites, enriching the predictive quality of the recommended ads. At least in theory. In practice, they create immediate friction in the user experience and are used in unknown ways with little if any perceived benefit.
Conversely, when a consumer 'connects wallet' and shares the onchain data it has accumulated from different experiences, this could in theory provide the same level of rich data on a new user as cookies do while representing a much more valuable opt-in because the consumer knows exactly what data will be shared. Brands will offer consumers options to share their data in more intentional ways, and may even incentivize data-sharing through rewards or benefits.
- Web3 can enhance the content experience layer
Some executives believe media distribution has become too focused on numbers, traffic and ad sales instead of creating differentiated, valuable content for their audiences. Tokenized media rewards loyalty and can unlock added revenue streams beyond the monthly content subscription from deeply engaged consumers invested in their success. Web3 can provide the infrastructure layer for consumers to more actively participate in the editorial or curation decisions with the publisher. Instead of running Twitter polls with limited transparency, consumers could co-decide on which stories a reporter covers, or co-create it with them, and then co-own the article onchain (a model crypto outlet Coinage adopts).
- Token-gated accounts as secure user authentication
Instead of managing different accounts for every media brand, with web3, consumers can connect a wallet to verify their membership status and gain access. This sees the user get access to subscription-only content and potentially other rewards for further engaging with the media company e.g. article reads, likes and shares, event attendance, co-creation etc.
Brand use cases we're tracking
- @TIME TIMEPieces pioneering collectibility of TIME cover artworks that serve as a membership to the publication (TIME)
- @NFTNow Now Pass ushers in a game changer media model, for the future of tokenized media (NFT Now)
- @Bluesky Dorsey-backed twitter competitor aims to give users algorithmic choice (Techcrunch)
- @GQMagazine release first NFT collection. ‘The GQ3 Issue 001: Change Is Good” including a magazine subscription (Coindesk)
- @CoinageMedia Co-owned media Coinage paved the path to subscriber-led crypto journalism
- @Meta’s Mastodon-compatible decentralized Twitter rival launching in June (Beincrypto1 / Beincrypto2)
- @Okaybears NFT project create Okay Ad Network (a16z)
- @Dirtyverse wants to be your neighbourhood’s third space (Coindesk)
- @137pm culture token promises access and collabs with cultural and brand icons
- @Coindesk Microcosms NFT created multi-tiered access to conference Consensus (Coindesk)
- @Overpricedjpegs podcast NFT drop came with a OPJ Gin, meetups and studio access to pod interviews in studio (Opensea)
Our 0.02ETH 🍃
Media brands have been searching for a sustainable business model since the internet disrupted print and TV. The industry's decade-long trend away from ads toward direct-to-consumer does align nicely with web3's emerging use cases within brand loyalty and incentivized retention. Whatever form the tokenized media trend ultimately takes, it's important to follow for two key reasons: user experience and consumer data. With next year's planned obsolescence of cookies, media brands have a deadline to jump to something new. Thankfully, there are already a few pioneers showing them how it could be done!
Covered by Mojito, the web3 consumer engagement platform. Empowering brand leaders with powerful tools to drive consumer engagement, sales, and loyalty for all levels of web3 maturity.
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