As the cryptocurrency market continues to slump, many cryptocurrency companies have begun to gradually tighten their marketing spending to cope with the tight cash flow. In just 5 months, the crypto industry’s TV ad spend has plummeted from $85 million to $36,000.
Cryptocurrency storm continues, many exchanges cut advertising spending
Whenever the economy is down, companies will try their best to cut non-core business expenses, and marketing expenses are often the first to bear the brunt. According to TV advertising measurement and analysis firm ISpot.tv, several crypto companies including Crypto.com, Coinbase and FTX have significantly tightened their TV marketing expenses in the past few months, revealing that the market may be facing a serious test.
Cryptocurrency crash prompts companies to cut advertising costs
According to ISpot.tv, the cumulative advertising spending of major cryptocurrency agencies in July this year was only $36,000, which is nearly 25 times less than the peak of $84.5 million in February.
The reason why the advertising amount reached a new high in February this year was not only due to the good market situation at that time, but also because it coincided with the official start of the Super Bowl of the American Football League. The Super Bowl has long been the most-watched sporting event in the United States, and many companies have seized the opportunity to spend heavily to run commercials during the hottest and most expensive ad slots. Coinbase alone reportedly spent nearly $14 million in TV advertising, and cryptocurrency exchanges that also advertised include FTX, Crypto.com, eToro, and more.
With the sharp decline of the cryptocurrency market and the increasingly strict regulatory measures of the local governments in this field, the related industries have to increase revenue and reduce expenditure in many ways to cope with the financial difficulties. Coinbase issued a letter to shareholders earlier, notifying that it will reduce the scale and expenses of paid advertising in the next quarter.
Adjusting publicity strategy to replace TV commercials with sports sponsorships
While demand for TV advertising from cryptocurrency companies is currently down, a Financial Review research report shows that companies like Binance Holdings, OKX, FTX and others have invested more than $2.4 billion in sports marketing over the past 18 months.
In March, OKX signed a sponsorship deal with Manchester City estimated to be worth $12 million. In addition, FTX has also reached a 19-year partnership with Miami-Dade County, and announced that the Miami Heat’s home stadium will be officially renamed “FTX Arena”, sparing no effort in brand promotion.