A recent report by Web3 marketing firm Addressable sheds light on the cost of acquiring users with existing crypto wallets, revealing that campaigns in the gaming and gambling sectors are the most expensive. Asaf Nadler, co-founder of Addressable, highlighted that these campaigns have a median Cost Per Wallet (CPW) of $8.74, with a lower quartile of $3.40. CPW is considered a valuable metric as it tracks the cost of attracting website visitors who already have a crypto wallet installed in their browser.
Nadler pointed out that users with wallets are more likely to convert to crypto products, which may explain the higher cost associated with gaming and gambling campaigns. He attributed the high cost-to-return ratio in these sectors to factors such as higher churn rates, speculative behavior, and intense competition. Nadler emphasized the need for a more effective user acquisition strategy to ensure the sustainability of Web3 gaming.
Despite the challenges in the gaming and gambling sectors, Jeff "Jiho" Zirlin, co-founder of Axie Infinity, suggested that periods of high CPW present opportunities for experimentation and market expansion. Zirlin encouraged industry players to create new games and product lines, consolidate market share, and prepare for future growth phases.
In contrast, decentralized finance (DeFi) and Centralized Finance (CeFi) campaigns were found to be more cost-efficient, with a median CPW of $2.79 and a lower quartile of $0.10. According to Nadler, these campaigns have an easier time attracting new crypto users compared to gaming and gambling campaigns.
Addressable's analysis was based on 200 programmatic campaigns involving over 70 advertisers targeting an estimated 9.5 million users globally. The study examined how CPW varied across different market cycles, regions, campaign strategies, and audience segments. Premium markets, such as the US and Western Europe, were noted to experience significant cost fluctuations based on market sentiment, becoming more expensive during downturns.
Nadler highlighted that while premium markets offer scalability and quality during bullish market conditions, they become less sustainable during bearish periods. On the other hand, emerging markets like Latin America and Eastern Europe may provide lower CPW in favorable conditions but can also experience extreme cost volatility.
The data underscores the importance of understanding the nuances of user acquisition costs in different sectors of the crypto industry and adapting strategies accordingly to navigate market fluctuations and attract and retain users effectively.
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