Crypto Gaming and Gambling Ads Are the Most Costly for User Onboarding
Recent insights from the crypto marketing sector reveal that campaigns focused on crypto gaming and gambling have emerged as the priciest methods for onboarding new users. According to data provided by Addressable, a prominent Web3 marketing firm, these campaigns exhibit a median cost per wallet (CPW) of $8.74, significantly higher than other sectors within the cryptocurrency industry.
Understanding Cost Per Wallet (CPW)
Cost per wallet is a key performance metric that assesses the financial efficiency of marketing efforts by tracking the costs incurred to attract website visitors who already possess a cryptocurrency wallet. Addressable co-founder Asaf Nadler emphasized that this metric is advantageous since users with active crypto wallets have a higher likelihood of converting to various crypto products.
“Gaming and gambling campaigns are the most expensive, with a lower quartile of $3.40,” Nadler reported in a study shared on X (formerly Twitter). He suggested that the unfavorable cost-to-return ratio in these sectors could be attributed to several factors, including “higher churn,” speculative user behavior, and robust competition.
The Challenge of High Churn Rates
Nadler’s analysis indicates that the high churn rates seen in gaming and gambling sectors hinder the sustainability of user acquisition strategies, as they lead to increased costs without guaranteeing long-term engagement. “If Web3 gaming is truly ‘inevitable,’ we need to find a more powerful UA engine to make it sustainable like Web2,” he advised.
In contrast, campaigns aimed at decentralized finance (DeFi) and centralized finance (CeFi) have proven to be significantly more economical. With a median CPW of just $2.79 and a lower quartile as low as $0.10, these sectors showcase a more efficient method of attracting users within the existing cryptocurrency ecosystem.
Current Market Dynamics
The findings stem from an extensive analysis of 200 programmatic campaigns executed by over 70 advertisers targeting approximately 9.5 million users across the globe. The results further demonstrate how CPW fluctuates based on market cycles, regional variations, and the specifics of campaign strategies and audience engagement.
Nadler pointed out how premium markets, which typically offer lower conversion costs during bullish market phases, can experience sudden spikes in these costs during downturns. For instance, in 2024, CPW in the United States and Western Europe saw significant increases of fourfold and twenty-sevenfold, respectively, as interest from crypto wallet holders diminished in a consolidating market.
“While these markets offer scale and high-quality engagement in bull runs, they become prohibitively expensive when sentiment shifts to bearish,” Nadler explained.
Opportunities in Emerging Markets
On a brighter note, Nadler highlighted emerging markets such as Latin America and Eastern Europe, which present notably low CPW during favorable conditions. However, he cautioned that these regions can experience extreme cost volatility that may complicate marketing efforts.
Jeff ‘JiHo’ Zirlin, co-founder of the popular crypto game Axie Infinity, suggested that periods of heightened CPW should be viewed as opportunities for innovation. In a recent post on X, he encouraged developers to create new games and product lines during these times, preparing for future market expansions. Zirlin stated, “Know when it’s a coiling phase. Know when it’s time to explode.”
Conclusion
As the crypto industry continues to evolve, understanding the dynamics of user acquisition will be crucial for companies looking to capitalize on the opportunities presented by the gaming and gambling sectors. While these sectors may currently be a costly approach for onboarding new users, insights from data can guide future strategies for more effective and sustainable marketing efforts.
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