Crypto request: How Facebook’s Libra coin will affect marketers
July 2, 2019
It was only a matter of time. After Bitcoin exploded in the mainstream back in 2017, the global market was ripe for the introduction of a cryptocurrency that had all the allure of not being regulated by a central authority yet safe enough to be a reliable form of transaction.
On June 18, the tech juggernaut announced plans to launch its own blockchain technology powered cryptocurrency, named Libra. Facebook was not alone in this endeavor; in a bid to lift the cryptocurrency technology from the Erebus of the Dark Web to the commercial heights of the mainstream, Facebook announced that it will partner with 27 more organizations (including Visa, Paypal, Uber, Mastercard, Spotify, and others) to form a non-profit organization called Calibra that will be based on Switzerland and will handle operations for Libra. The hope here, of course, is to utilize the clout of these global companies to sway public opinion and act as a subliminal guarantee that -unlike all the other cryptocurrencies- Libra is safe to use.
Whether this new business venture succeeds or not is irrelevant; social media and cryptocurrencies were bound to meet at some point in digital history so marketers need to be prepared for the day the two are intertwined.
One social media platform to rule them all
David A. Marcus, the project head for Libra, was clear in his many interviews after the cryptocurrency was announced: Facebook will not be running Calibra but instead have the same rights as every other partner. Marcus had to assure people that this was the case, as the image of company CEO Mark Zuckerberg testifying before the US Congress regarding the Facebook – Cambridge Analytica data scandal will be forever burned in everyone’s mind. Facebook was caught playing fast and loose with user data far too many times to have any sort of credibility when it comes to protecting people’s private information, but one has to approach a critical mass of naivete to believe that Facebook will let any competitor get in with Libra.
Facebook will be the only major social media platform associated with this cryptocurrency so marketers need to really educate themselves on how the Facebook advertising algorithm works, how to provide content for optimal reach and how to execute campaigns that could be solely limited to this platform. Having a baseline knowledge of Facebook and treat like all other social media will not be enough: you need to become an expert on Facebook marketing first and foremost; the others can wait.
It’s a microtransaction world
Libra’s chief function will be to allow the transfer of money from your digital wallet without any of the fees banks usually apply. Integrating that wallet with Facebook will change the way goods are marketed and sold. Libra will initially be used for everyday transactions on Messenger and Whatsapp but the bigger picture is not hard to see. With over 90 million businesses currently on Facebook, the possibility of completing the buyer-seller cycle without ever leaving the platform isn’t an impossibility anymore.
Hey, you like this cool t-shirt? No need to visit our site and go through the arduous registration process! Where you will be forced to put in your credit card information and fill in these personal information details. Because seriously, who DOES know their zip code without looking it up? Just click this nifty “Pay with Libra button” here and the t-shirt is yours! Where to ship it? No worries, we have that information from your Facebook account. And if we have any questions, we can always call you on the mobile number you provided for a two-step identification! Hey, did we tell you about this amazing vacation package from our sister company?
As microtransactions more than doubled the gaming industry revenue in 2018, this function is expected to cause product sales to skyrocket. Marketers need to make sure that when the big wave comes, their clients are riding the surfboard.
Remapping the UX
The ability to instantly purchase means that marketers need to completely rethink the user experience. Where previously the goal was to guide users seamlessly towards buying the product, now the focus should shift more towards making an amazing first impression. An impression so good that the user would immediately be convinced to buy the product on the spot. Micro-moments -these intent-rich moments when decisions are made and preferences shaped- moments when marketers expect users to look up certain topics and products, will be more important than ever and identifying those micro-moments will be the key to unlock success. Anticipating a need and catering to it will be the most important challenge for marketers.
A single identity
New Yorker cartoonist Peter Steiner once said, “On the internet, nobody knows that you are a dog”. The shroud of anonymity has always been an issue, as right now users are more skeptical than ever when dealing with people online. Many tried to solve this but none succeeded: users either gave false information or chose to not divulge personal information out of fear of being hacked. So the problem remains: How do you make sure that people are who they say they are?
Facebook might have a solution. In the white paper on the Libra coin, the authors included two lines that immediately raised eyebrows:
“An additional goal of the association is to develop and promote an open identity standard. We believe that decentralized and portable digital identity is a prerequisite to financial inclusion and competition.”
It is apparent that the tech giant will somehow push for a form of internet -therefore global- identity through its use of Libra coin. This does make sense. If one deals with an actual person then one is far more willing to engage.
But how does a global identity affect marketers? Facebook will need a way to signal that this person is who he/she says he/she is, which could be achieved through some sort of verification badge. Which of course means that the influencer culture will be more important than ever, on every single step of the marketing process. Product reviews? Just imagine the impact they will have if the buyer can actually see that these are real people and not hired contributors or bots. Or what kind of loyalty an online store or product would inspire if the buyer knew exactly who he/she is dealing with every step of the process. If Facebook manages to propose some form of global identity to go with the Libra coin, full transparency will become extremely important. The more the user knows about the company and its people, the more likely he/she will be to engage.
Be prepared for new markets and audiences
The World Bank’s 2017 Global Findex Database identified 1.7 billion people in the world as “unbanked”, meaning that they do not have an official bank account. What is more surprising though is that out of those people, 1 billion has internet access and is on Facebook. During the launch of Libra, Marcus stated that the organization’s first goal is to allow “the unbanked” to have a reliable money keeping and transfer option.
It would be a mistake to outright believe that these people don’t have bank accounts because they don’t have bank access. While this might be the case for many, most just don’t trust banks to carry out transactions or don’t want to pay bank fees for transfers. Libra coin will not only bring these people into the banking and marketing fold but also the multitude of those who have bank accounts but are skeptical towards traditional banking institutions. Marketers will need to develop an arsenal of buzzwords to advertise to these people and adjust their strategy to address their concerns over data protection. Breach of personal information will be a major point for people in general, so familiarizing with GDPR best practices is paramount.
Here at Action Digital, we are experts on digital marketing in general and social media in particular and unlike Zuckerberg, we don’t hold grudges! Not sure how to react to the never-ending shifts in the digital marketing field? We got you covered.