2018 was undoubtedly the biggest ever for the initial coin offering (ICO) market. In the first quarter of 2018, ICOs raised more money than they did in the whole of 2017. In 2017, ICOs brought in $5.6 billion with an average ICO of $12.7 million. If you compare that data to the IPO (which raised $188.8 billion), that’s pretty modest. Clearly, there is still a long way to go.
ICOs success rate is also not great. In 2017, only 48% of these were successful enough. However, a change is happening right now and the new player is STOs or Security Token Offerings. Ever since it became easier to get funds from non-traditional sources, many questionable ICOs have surfaced and tarnished the image of the industry. This is when the Securities and Exchange Commission (SEC) stepped in.
Security token offerings, commonly known as STOs, are considered as one of the best alternatives to ICOs that are more compliant with security regulations. When multiple ICOs fail to gain approval from the US Security and Exchange Commission (SEC), STOs do so easily.
STOs are considered the next biggest thing in the world of cryptocurrency. Some are even predicting an STO dominance of just $10 trillion by 2020 . STOs are very different from ICOs. Whether you are taking the ICO route or STO, a solid marketing plan is the only way to success.
If you are planning to launch an STO, then you need a foolproof STO marketing strategy which we will describe in this article. In this detailed article, you will learn how to launch a successful STO and how to market your STO the right way, without using expensive STO marketing services.
What is the difference between ICO and STO?
The main difference between ICO and STO comes down to rules and target audience. ICOs are usually crowd-funded through retail investors. A retail investor can be virtually anyone. They generally include low-income individuals who do not have financial knowledge or much knowledge of regulations or business planning.
STOs do not necessarily work with retail investors. This is mainly due to regulatory limitations. For example, if you are launching your STO in the US, only accredited investors can participate. This effectively replaces the entire security token strategy from an ICO. The STO marketing strategy will be geared towards more sophisticated investors.
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Who invests in security tokens? This usually happens with consistently high income or a lot of capital. Such investors are very smart and hardworking. They won’t budge for a flashy website or large social media presence. Your STO marketing plan will need to be designed according to their personality.
STO Marketing Plan: How to Market Your STO?
As with any marketing or PR plan, you need to clearly define your marketing goals. It starts months before the actual marketing practices begin and the STO is launched. If you start out without a clear, research-driven strategy, you will be throwing money into marketing STOs without achieving the actual underlying goal.
With questions to be answered and legal steps to be taken, then it’s time to actually design the marketing plan. In short, you should have four to five clearly defined goals that envelope everything you want to achieve with a security token offering.
The big question is who exactly do you want to target. In the case of STOs, it shouldn’t be too difficult to put yourself in the shoes of investors buying security tokens. Everything you do from this point on has to revolve around their personality. For example, geolocation is something you might need to pay attention to. Investors can have different views in different places.
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creating the perfect website
The most basic part of your security token marketing strategy is the website. Regardless of where the customary security token investor comes from, the website will be their first interaction with them. You can change many things in the long run of a security token strategy, but if you mess up the first impression you are off to a failure.
The homepage is of vital importance. It acts as the face of the STO. Think of it as the executive summary of the business plan. Creating a highly professional and informative homepage and a website is the first step in gaining the trust of your potential investors.
Here are some guidelines for the website:
- The website should clearly answer all the questions that investors may have
- It should be rich in media (infographics, videos etc.) as long as it is relevant
- It should be clean and well structured
- A comprehensive, technical and transparent whitepaper that is easily accessible
- You may feature a press release section to show that journalists and the general public are interested in the project.
- The website should provide sufficient information about the people involved in the STO (how to contact them)
The foundation of your website is correct. As is common with anything you build, if the base is strong the rest of the structure has a better chance of survival.
Handle all legal complaints
This is very important not only for STOs but also from the marketing aspect. As mentioned earlier, this is one area that differentiates an STO from an ICO. Before launching an STO, it is imperative that you meet all compliance requirements. You are looking at institutional investors. They will get into every little legal detail of an STO and have the financial knowledge to break everything down. Unlike retail investors who lack such knowledge, these investors will be interested to know if you comply with all regulations set forth in your jurisdiction.
When you are clear that you are presenting your token as a security token and complying with all the rules set out, you can use this as a marketing strategy. All legal documents should be readily available to potential investors. In all other marketing methods, you can try your best to go about this compliance.
You will need to consult with lawyers who have experience in the security token businesses. They will guide you through all the requirements that you need to fulfill. You can also mention the law firms you have worked for on your website. Everything about compliance and legal structures around STOs should be out in the open.
How to Launch a Successful STO: STO Content Strategy
Content is king, and the fact remains the same for STO marketing. Your marketing material is going to act as your voice, and you want to be heard, aren’t you? Content marketing will serve as a pillar of your overall strategy for two reasons.
Firstly, it gives you a chance to introduce yourself and share your knowledge and story. Second, the kind of audience you are targeting will want to know more about you, your business background, and the road plan of the STO. They do this through the content you publish.
- create a blog
The website needs to have an active blog. You need in-depth articles, often with infographics and statistics, to show you why investing in your security tokens is worth it. This is one of the most effective STO marketing tips. People may need something to explain and your blog is your best chance to do so.
The blog allows you to develop yourself as an authority in the industry, by publishing high-quality blog posts on related topics.
Setting up a blog is only going to take a few minutes thanks to the tools available today. However, you will struggle in the beginning. It may take some time to attract some traffic to the blog. Remember, your blog will run in conjunction with other marketing platforms.
While there’s no thumb rule here, publishing two to three detailed articles on a variety of topics is a good start. You may also want to post on other established blogs.
- Use other content publishing platforms such as Medium
In the world of Cryptocurrency, Medium is the number one choice for that. It is quite professional and has a wide variety. Another particularly popular one in the blockchain sector is Steemit. Again, this decision also depends on who you are targeting.
We have talked about articles at length but do you know which medium gets the most engagement? Video is now considered one of the most engaging and fastest growing media on the Internet.
You want the convenience of original video content to accompany your blog articles. Alternatively, you can start a YouTube channel with monthly video postings. This can be a way to reach young investors who prefer interactive media over the rest.
Reach STO Experts or Hire STO Marketing Services
Even if you see yourself and your STO as a trailblazer, there are a lot of hurdles you are bound to face. STO experts can be of great use to avoid such hurdles. Another thing you need to keep in mind is the competition. That should be your lesson from the yesteryear ICO. There were just too many. Who’s to say this won’t happen with the security token business?
You have three areas where you need expert help: legal, technical and marketing. Any advisor with a strong knowledge of the market and its challenges will bring a lot of new things to the table that you might never have gotten otherwise.
However, the best part is the connection. Such persons can give you the right connections in the industry to establish your network. This STO aids in marketing, eventual launch and of course its success.
Getting help from STO experts will not be easy. You will first need to hunt down who they are. You need to find influencers, editors and activists. Twitter and LinkedIn can prove beneficial in reaching them and grabbing their attention. In addition, you should consider attending security token events. There you can meet them in person and choose their mind about your venture.
start a newsletter
At this point, you know the basis of your STO marketing strategy. Most of the times people focus on marketing to attract investors in the context of STOs. However, the marketing phase is a recurring one and involves retaining those potential investors. You need to ensure that the investors who have shown interest remain hooked.
Email marketing is considered a strong tool when it comes to retaining current or potential customers. You need to start a weekly or monthly newsletter to keep potential investors in the loop. This is going to prove to be crucial in retaining investors and growing your network.
You must have heard about e-mail marketing being a buzzword with high bounce rate. Not so with newspapers. This is because it’s kind of personal that the reader chose to sign up and is interested in reading the content.
Newsletters can be used to update potential investors on what you have achieved so far. This can be a way to inform them about the roadmap to be implemented in time. It also emphasizes your transparency while making the STO more promising.
Any article you publish on the blog can be featured in the newspaper. You can share your knowledge with the readers to motivate them to be a part of it. If you consider yourself a strong leader with an opinion, you can use the voice to comment on recent industry events and market trends.
Use social media to your full advantage
Social media is now an essential platform for any business and STOs will be no exception. We have seen ICOs using social media to its full potential. Although, STO is different from a traditional ICO, the use of social media will be slightly different too.
First, you need a presence on all professional social media outlets. These mainly include LinkedIn and Twitter. You’ll also want to capitalize on the biggest social media platforms like Facebook and YouTube. The latter is of course reserved for all your video content, including any interviews you give.
There are other platforms like reddit. However, they don’t really have the same effect as the others. Also, your target audience may not even be present on such chats or discussion forums. So that basically skips Twitter, Facebook and LinkedIn.
Twitter and Facebook will serve as a means to communicate with the general public and potential investors. You can use these platforms to share all the content you create to market the STO. A huge number on such platforms can also grow to strengthen your credibility. Ultimately, LinkedIn will primarily serve as a way to network and build professional relationships with industry stalwarts.
STO Marketing Tips
The regulations surrounding STOs prevent certain mediums from being used to bring securities into the direct market. However, bringing it directly to market is not impossible. In fact, your security token marketing strategy should revolve around mediums that you can still use legally.
Here are some useful STO marketing tips:
- Use utility marketing to:
Since you cannot market the tokens directly, you will have to come up with different means for proxy marketing. There are online publications, magazines and blogs that can do this for you. It’s just a matter of recognizing them.
- competitor analysis:
This should come in handy at every stage of the STO. As the numbers indicate, STOs will take over ICOs in a short period of time. That means a lot of competition to take care of. Proper competitor analysis will also aid your marketing plan and keep you ready for any curveballs.
- Build a library of potential investors:
Targeting the right audience is the key to achieving success with STOs. You need to take into account every potential investor and buyer. Having this data can be of huge benefit when sending emails, newsletters, etc.
- Keep in mind regulation D:
STO marketing is a bit complicated, which can be allowed. If you are in the US, Regulation de Sec 506(c) prohibits you from advertising on television, newspapers, magazines, radio, public seminars, and the Internet. You absolutely don’t want legal trouble at this early stage.
- Participate in Blockchain and Cryptocurrency Conferences:
Conferences like these can provide you a means to meet other blockchain company owners and cryptocurrency enthusiasts in person. Think of it as a platform for both marketing your STO and building your network. Do some research about such persons before going to the conference or convention.
STO Marketing Services
By now you must have understood that STO marketing is not a job for the faint hearted. This is going to take up a great deal of your time and resources. You will need the best people for the job. However, not everyone may be in a position to supervise everyone. This is where you may need the assistance of professional STO marketing services.
They will take care of everything from your side. All the information you read in this article can help you choose the right agency. Any company that warrants the implementation of a strong marketing strategy, as described here, should make the cut.
This STO marketing guide is for those who understand the importance of marketing security tokens to success. It’s going to be a long ride, with a lot in common. However, the advantage of having a solid marketing strategy and plan is that you can minimize any unforeseen risks.
Your ultimate goal is to attract the right audience, earn their trust and eventually convert. If you make sure that all the goals you set out to do as part of your security token marketing are addressed, you can be a part of this next big and lucrative trend in the world of Blockchain and Cryptocurrencies.