LUSH Ethical Cosmetics and Web3 | 🧼 |
PLUS - Why are brands leaving social media + TechyGirls Event
GM. 🫶
This is Web3 Espresso ☕—the Web3 Newsletter for creators, marketers, and coffee drinkers looking to understand how Web3 technology is changing the world we live in.
Hello 😎,
Social media has been an incredible tool for smaller brands with limited budgets to reach a wider audience. It is also a very useful tool to connect with a brand and provide feedback (good or bad) or to contact customer service. Social media platforms are also slowly becoming channels where users go to find answers, tips, or ways to connect with people.
Yet, social media managers are finding it increasingly difficult and expensive to reach their target markets.
Some brands have even made the bold move to shun social media altogether.
With the arrival of Web3 technology and its focus on community-first marketing, we can ask ourselves whether Web3 will replace social media altogether.
What does the future hold?
Read on.
What’s in store today:
🥡 The Weekly Roundup 5 in 5
☕+👧 TechyGirls Event
| 🧼 | Why are brands leaving social media?
The are the challenges facing social media platforms
Getting more out of social media
Can Web3 provide an alternative solution?
LUSH Cosmetics - Case Study
Let’s go! 🥤
🥡 5 in 5 …
The Five Stories You Need to Know This Week
Nike NFT sneakers sell like hot cakes, surpassing $1M 👉 see it here
Future of Web3: Unlocking The Next SaaS Wave 👉 watch it it here
The Metaverse Education Market Report 👉 read it here
NFT Financing Reshaping Lending and Borrowing 👉 read it here
F1 Ticket Provider Platinum Group Introduces NFT Tickets for Monaco GP 👉 read it here
🇲🇨 TechyGirls - Event [29th June 2023]
The TechyGirls association will be holding their next event in Monaco on the Thursday 29th June 2023.
This will be especially exciting as I will have the opportunity to talk about Web3 and more specifically how Web3 is revolutionising the luxury sector.
Join me for a fun night with the Monaco Web3 community.
🧼 Why are big brands leaving social media?
In the ever-evolving world of technology and digital marketing, brands have long relied on social media platforms to establish their online presence, engage with their target audience, and drive business growth.
However, in recent times, a notable shift has been observed as a number of brands have stepped away from the social media landscape. What could be the reasons behind this departure, and what does it signify for the future of brand-consumer relationships in the digital age?
In this article, I look into the intriguing phenomenon of brands leaving social media and shed light on the factors driving this trend.
What are the challenges and limitations that social media platforms present? How does the rise of alternative decentralised technologies in the Web3 era relate to the shifting priorities of brands in their quest for more authentic connections with their customers?
The challenges facing social media platforms
While social media platforms have undeniably transformed the way brands communicate with their audience, they are not without their limitations. Social media platform Planable asked 80+ social media managers what their top challenges were for 2023. Reach and engagement posed the biggest struggle with 32.2%, followed by ever-changing trends and algorithms (21.8%).
Social media has offered an incredible opportunity for brands and businesses to connect directly with their customers at a low cost. Not that long ago, the only way a business could drive awareness would be through expensive physical media buying (think newspapers, radio, TV, and billboards), which offered no granularity on success and ROI.
The rise of social media has been truly transformative for brands and businesses and has created new ways to reach very specific audiences, at a low cost and measure success.
So why are brands moving away from social media?
Here are 7 reasons that can explain why brands may choose to invest in other digital marketing channels:
Declining Organic Reach: One significant challenge for brands is the declining organic reach on social media platforms. As these platforms continue to prioritise paid advertising and algorithmic content curation, the visibility of organic brand content has decreased. This means that brands must invest more in paid advertising to maintain reach and engagement with their target audience.
Algorithmic Changes and Limited Control: Social media platforms regularly update their algorithms, which can impact the visibility and distribution of brand content. These algorithmic changes can sometimes be unpredictable, making it difficult for brands to plan and execute their social media strategies effectively. Additionally, brands have limited control over how their content is displayed and prioritised, further complicating their efforts to connect with their audience.
Saturation and Competition: The sheer volume of content on social media platforms creates a highly saturated and competitive environment. With countless brands vying for attention, it becomes challenging for individual brands to stand out and capture the interest of their target audience. Cutting through the noise and effectively differentiating themselves from competitors requires thoughtful strategy and compelling content.
Negative Feedback and Brand Reputation: Social media platforms provide a public forum where customers can voice their opinions, both positive and negative, about brands. Negative feedback, complaints, or public relations crises can spread rapidly on social media, potentially damaging a brand's reputation. Brands need to be vigilant in monitoring and addressing such feedback promptly and appropriately to mitigate any negative impacts on their image and credibility.
Adapting to Platform Changes and New Features: Social media platforms are continuously evolving, introducing new features, formats, and trends. Brands need to stay updated and adapt their strategies to leverage these changes effectively. However, keeping up with the ever-changing landscape can be a challenge, requiring brands to invest time and resources in staying informed and adjusting their approaches accordingly.
Ensuring Meaningful Engagement: Building meaningful engagement with followers on social media is crucial for brands, but it can be difficult to achieve. Many users passively scroll through their feeds, making it challenging for brands to capture and hold their attention. Encouraging active participation, fostering conversations, and creating valuable content that resonates with the target audience are ongoing challenges for brands seeking to cultivate meaningful engagement.
Data Privacy and Regulations: Data privacy concerns and evolving regulations add another layer of complexity for brands on social media. Stricter regulations surrounding data collection, user consent, and privacy practices impact how brands can collect and use consumer data for targeted advertising and personalised experiences. Brands must navigate these regulations while maintaining trust and transparency with their audience.
Getting more out of social media
The ultimate objective of social media marketing is to generate revenue, and building engagement is an essential first step in doing so. If your followers aren't responding to your posts, they won't be responding to your company. Creating a close-knit social media community is another surefire way to increase engagement. Social media communities are incubators for brand awareness, loyalty, and trust.
Some brands have been extremely successful at leveraging social media to create engaged and loyal communities. Glossier, a beauty brand, recognised the need for authentic interactions with their audience. They cultivated a community-driven approach by leveraging their online community, Glossier Reps, who became brand advocates and participated in product development. This focus on authenticity and co-creation helped Glossier foster a strong sense of community and loyalty among their customers.
Today, younger consumers are more demanding of brands. They seek authenticity and meaning to engage with brands on the long term.
Can Web3 provide an alternative solution?
Web3 technology offers brands an exciting opportunity to offer enhanced experiences to their users. In a previous article, I wrote about the concept of “guilded luxury”, a framework by which brands create ultra-bespoke services and immersive experiences for different kinds of consumers.
Web3 technologies facilitate community building and incentivisation. Brands can create their own decentralised communities where members actively participate and contribute to the growth of the brand ecosystem. Through tokenisation and rewards mechanisms, brands can incentivise engagement, loyalty, and advocacy, creating a sense of ownership and involvement among their customers.
But is this what consumers want?
The challenge I find with the idea behind Web3 is that it shifts the responsibility and action to the user. Not everyone wants to actively contribute to a community or a discussion.
I like this graphical representation of community members. Web3 is a great tool for the top of the pyramid but the masses at the bottom of the pyramid might just enjoy consuming content on social medial.
Case Study : Lush Cosmetics Leaves Social
Lush Cosmetics is a British high-street brand of natural cosmetics and bath bombs. They accumulated over 10 million followers across their social media accounts. In 2019, they decided to quit social media.
It recently released its Digital Engagement: A Social Future report, that outlines its position on the shifting digital landscape on consumers and offers a manifesto of ethical practices.
Going forward their marketing strategy will be aligned to three main pillars:
1. Reduce their spending on in Big Tech platforms such as Google and Meta by one third
The reasons behind this move were twofold. Part of it was because they were tired of being victims of the algorithm and having to pay to be in users' feeds, and the other was their stance on the detrimental effects of social media on users’ mental health.
More recently, they have taken a stance on big tech’s dominance of technology, information dissemination, and online culture.
“We wish to have zero reliance on the rabbit hole that is ‘trademark buccaneering’ on Google in favour of interacting with our customers in more ethically sound digital scenarios, such as across the metaverse,” the company said in a statement.
2. Adopt a more open approach to business
Lush Cosmetics has also implemented an open-source policy and uses open-source technologies in everything it designs, develops, and releases.
“Open-source has always been part of our business, and this will only strengthen as we move into a more tech-dominated world. We want to fast forward, accelerate away from Web2 toward Web3 as quickly as possible,” Lush director Annabelle Baker said.
3. Driving community action enabled by Web3 technology
In their report they also outline their position on Web3. Their research revealed that 60% of Gen Z and 58% of Millennials have found communities online that they wouldn’t have in real life, while a majority (56% and 52%, respectively) believe digital spaces enable them to express their identities in ways they can’t in real life.
As their leadership teams outlined in their Social Future report, Web3 technology will be leveraged to further engage with their community and foster a new form of collaboration.
Examples of Lush’s Web3 activations:
A metaverse activation during Metaverse Beauty Week in June 2023
Brands including Lush, Lottie London and Neutrogena will reimagine their products as digital wearables, AR filters, and gamified tools.
Community-led initiatives - They are looking to invest into their own communities outside of existing social media platforms. They have created a dedicated Discord channel and continue to nurture existing community-led Lush subredditIt with 81,000 fans making it one of the top 5% of Reddit communities.
Lush House at 2023 SXSW - see it here
LUSH wanted to bring their 2023 SXSW house to life in an immersive virtual experience that expanded access to anyone who wanted to attend. LandVault built a gamified digital twin of the IRL space in Decentraland – complete with a dancefloor, quests, branded wearables, and hidden Bath Bombs.
Lush x Super Mario Bros Collaboration - see it here
The ‘Question Block’ bath bomb, when broken or used in the bath reveals one of six unique soaps. These can be scanned on your Lush app, and added to your digital wallet. Collect all six, and gain access to an exclusive product which is available ONLY to those who have collected all six.
Levelling up the bathing experience with the Lush Bath Bot
Announced at SXSW 2023, the ‘Bath Bot’ is a little robot designed to accompany you in the bath.
Lush Lens - an AI powered digital packaging app
When pointing your camera at a naked product, the tool reveals details such as the product description, ingredients, price and an immersive video that demonstrates how it’s used.
Concluding Thoughts
Social media has revolutionised digital marketing. It has created a new communication platform between brands and their customers and at the same time, it has shifted some weight to the collective power of customers.
The challenges posed by social media platforms, from reduced reach, increased costs and the now proven detrimental effects of social media on mental health - have pushed some brands to make the bold move to shun social media platforms and explore alternative avenues for engagement. Lush Cosmetics is one of these brands.
The rise of Web3 technologies, with its focus on community and the potential for decentralisation and enhanced control, has offered new possibilities for brands to establish augmented experiences and to drive increased loyalty from their communities.
Yet, this movement is still very small and I do not believe that social media will be replaced by Web3 marketing strategies.
The brands that are being the most successful are using omni-channel approaches to reach and engage with their audiences. They leverage social media to drive community-building, not awareness.
That’s all for this week… 🫶
Please note that I do not recommend or endorse the companies and organisations mentioned in this newsletter. This content is purely informative and not a recommendation. Always be mindful of where you connect your wallet. Always do your own research. 💛