Experiences from a Successful ICO: Part 1 — Bounty Campaigns
It’s been a month and a half since our ICO ended, allowing all of us at Hash Rush to take a breath and reflect on what went well and what could have gone better. We’ve decided to publish a short series about our experiences from a successful ICO, and hopefully, this can offer some tips and tricks to others wanting to run an ICO of their own.
Part 1 looks at a common ICO marketing strategy: Bounty Campaigns.
An Introduction to Bounty Campaigns
When it comes to ICOs, one term can be found in pretty much every instance; that is the Bounty Campaign. A Bounty Campaign is a method of marketing and PR that allows organisations to forego the traditional methods of utilising specialised teams to work on press tours, press releases, and viral marketing. Instead, it empowers the online community to take over this role and thus become the voice of the project.
How do Bounty Campaigns work?
Bounty Campaigns are very easy to understand; fans, followers, and members of the online community are incentivised to spread information about the project’s product or service (and ICO) directly to other people.
This is done by setting a number of tasks along with providing a reward (the bounty) for each person that completes those tasks. The bounties offered for taking part are traditionally given in the form of the token or coin that the ICO is offering. For instance, you could write a blog article about the project and be rewarded with a number of coins.
Bounty tasks vary from project to project, but they tend to have a similar set of core tasks:
- Social media awareness (following, liking, and sharing)
- Forum awareness (have a project signature for specific forums)
- Blog and online media awareness (writing articles and creating video content)
- Translation tasks
As the participants are being compensated for their work, this is, in essence, a type of sponsored content that costs very little, and is (in theory) highly targeted. This is based on the assumption that the friends, family, and followers of someone already interested and involved in the cryptocurrency scene would be more likely to be open to the ideas behind an ICO that they’ve chosen to promote.
By utilising the online community in this way, you have an early opportunity to build a relationship with your followers. Ideally, they will also start to feel like productive and engaged members of the project’s community. This all helps to plant the early seeds of brand loyalty towards your project, which is something that all ICOs should work towards.
An Example of a Twitter Bounty Campaign
Most bounty campaigns have certain terms and conditions that participants have to follow. As an example, we’ll show you the Hash Rush Bounty Campaign for Twitter.
- To participate, you need to go through the form registration found here. (link to registration form).
- Each participant in the Twitter Bounty Campaign needs to have a minimum of 300 followers.
- If you use spam or ‘artificial’ likes, shares or followers you will be excluded from the campaign.
How to earn ‘contribution’ stakes in the Twitter campaign:
- Each participant should follow the official Hash Rush Twitter account and retweet 3 of our Tweets at least once per week.
At the end of the Twitter campaign, we added up the contribution stakes of each participant, calculated how many tokens (in our case, Rush Coin or RC) everyone would receive, and sent them their RC.
Issues with Bounty Campaigns
As ICOs have become more popular, a number of issues have become evident that result in a large negative impact on the value and effect of many bounty campaigns, ours included. This stems from a split in the online community between those that join bounty campaigns because they believe in the project, and those that join as a result of the financial incentives (bounty hunters).
For the majority of bounty hunters, there is very little incentive to do a good job. This is due to a major problem found in many bounty campaigns where the rewards are based only on participation, not on the quality of work. This leads to instances of translations being the result of a quick pass through Google translate, or blogs ‘written’ that are little more than a copy and paste of older official content. But the biggest issue comes from the social media campaigns.
Bounty Campaigns and Social Media
Looking at the participants of various social media bounty campaigns (including ours), it quickly becomes clear that a large number of participants do not add value to the ICOs they are promoting. This comes from the bounty hunter side of the communities and the fact that the social media campaigns are the easiest to take advantage of.
By looking at the participants of the Hash Rush Social Media campaigns the problems can be broken down into three major points:
- Newly created accounts that are filled with fake followers.
This creates the illusion that shares by the account will be seen by many people. However, the majority of the followers will be bounty hunters, empty accounts, or accounts from people that only value the number of followers that they have.
- Accounts that are set up to automatically like and share content.
This guarantees that your content will be liked and shared — however, it will be the same for every campaign that the owner has joined. This means that even if there are some real followers, they are more than likely to ignore the shares as it quickly becomes spam.
- Accounts that are stolen and/or purchased from real people.
Spam and bot accounts are eventually banned by Twitter, and some campaign managers have become more cautious of accounts that were created recently and have thousands of followers. This has lead to a market (illegal by Twitter rules) for older accounts. Unfortunately, a lot of these accounts are stolen.
A combination of the points above leads to the situation where even if your content is being liked and shared, very few real people will see it. Hence, the value of the campaign is greatly diminished.
This situation presents the ICO managers (and its marketing team) with a unique and complicated task. If not managed with diligence from day one, the number of spam accounts signing up to a bounty campaign will leave project managers with the difficult task of choosing the best course of action. Should the campaigns be halted? Should the abuse be ignored, or should the participants be checked once the campaign is over?
Each case has its merits, but also has its drawbacks. Ignoring the problem is the easiest, but that contributes to the wider problem that future ICOs will face. At the same time, stopping or auditing (as we did) the campaigns might lead to a backlash from the community but does preserve the project’s integrity and commitment to fairness.
Leveraging Bounty Campaigns for a Successful ICO
By now it should be clear that there are several obstacles to be aware of when running a bounty campaign for an ICO. But even with the potential for abuse, bounty campaigns still can be very effective.
The major ‘takeaway’ from this article should be that a bounty campaign needs to be put together carefully from the beginning. You need to have a plan for properly managing entries to ensure your campaign truly adds marketing value to your project. For instance, you could check participants’ social media accounts or view a sample of their work before allowing them to join your campaign. But with thousands of participants, this is not as easy as it sounds and may be very time-consuming. That could be the reason why, unfortunately, many bounty campaigns don’t have any checks in place and still accept everyone.
That said, we would still advise everyone who’s about to run an ICO and accompanying bounty campaign to put in place a vetting process. Without it, your bounty campaign may lose some of its effectiveness, and your ICO could be less successful as a result.
We hope you enjoyed reading the first part of our series ‘Experiences from a Successful ICO’. In Part 2 we’ll talk about ICO marketing and data, so stay tuned. If you’re interested in hearing more about Hash Rush, take a look at our website.