In virtual currency exchange Crypto.com’s latest ad, titled “Bravery Is a Process,” star basketball player Joel Embiid walks through Philadelphia while Bill Self, his former college coach, lends the narration.
“Even when our path didn’t make sense to everyone, we kept going,” Mr. Self says in the ad, which debuted May 6. “We keep going, until our path is the one they wish they’d taken.
What the ad doesn’t say: The crypto market is in a meltdown. Buyers beware.
Enthusiasm for crypto from Hollywood celebrities and top athletes has peaked over the past year. On social media, in interviews and even in music videos, they described virtual currency as a world with its own hip culture and ethos – a culture that was more inclusive than traditional finance and involved the possibility of earning a lot of money. ‘money.
The Super Bowl was dubbed the “Crypto Bowl” this year because so many ads – which cost up to $7 million for 30 seconds – featured the industry, including several with names in bold.
But after investors saw hundreds of billions of dollars disappear in a sell-off this month, these infamous boosters are now facing mounting criticism that they tricked vulnerable fans into investing in the crypto without emphasizing the risks. Unlike clothes or snacks or many other products peddled by celebrities, the crypto market is volatile and rife with scams.
“It’s real money that people invest,” said Giovanni Compiani, assistant professor of marketing at the University of Chicago, whose research has found that younger, lower-income investors tend to be too optimistic about the trajectory of crypto. “Those promoting it should be more upfront about the potential downsides.”
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So far, crypto celebrity boosters have been largely silent on whether they have any doubts about their promotions.
Crypto.com declined to make Mr. Embiid available to discuss his partnership with the company. Matt Damon, who compared the rise of virtual money to the development of aviation and spaceflight in a criticized but widely viewed Crypto.com ad last year, did not respond to requests to weigh in. No response either from basketball star LeBron James, who was featured in the company’s Super Bowl ad this year.
Reese Witherspoon, an Oscar winner who said online in December that “crypto is here to stay,” did not respond to a request for comment. Neither was Gwyneth Paltrow, another Oscar winner, who lent her name to a Bitcoin giveaway late last year.
Paris Hilton, who has nearly 17 million followers on Twitter who watch her coo in front of her Crypto and Ether pocket dogs, did not respond to a request for comment. Neither do several other famous crypto pushers, such as Mila Kunis, Aaron Rodgers and Tom Brady (although Mr. Brady and Mr. Rodgers’ Twitter profiles still feature laser eyes, a popular symbol of Bitcoin optimism) . A rep for Naomi Osaka, the tennis star who became an ambassador for crypto exchange FTX this year, wrote in an email that “unfortunately she is overseas and not available.”
In FTX’s Super Bowl commercial, comedian Larry David disparaged important inventions such as the wheel and the light bulb before dismissing crypto. The ad admonished viewers in the blink of an eye, “Don’t be like Larry.”
Jeff Schaffer, the director of that Super Bowl spot, said in an email that he and Mr. David had no comment on the market crash.
“Unfortunately, I don’t think we have anything to add as we have no idea how cryptocurrency works (even after explaining it to us many times), don’t own it and don’t track its market,” he said. . “We just decided to do a fun commercial! »
Crypto’s instability underscores a fundamental mistake in celebrity marketing: A famous person’s endorsement can be memorable – actor John Houseman’s spots for investment firm Smith Barney decades ago are legend of Madison Avenue – but that doesn’t make the product being pushed worth trying.
“That’s what they do — they’re celebrities, they’ve been offered money to promote something promising,” said Beth Egan, an associate professor of advertising at Syracuse University.
Expand your cryptocurrency vocabulary
But it was not without risk, Ms Egan said. Had the crypto industry continued to thrive – or returned to its high-flying status – endorsers could be lauded. But if the downturn continues, their reputation could suffer.
“If I were Matt Damon or Reese Witherspoon, I would question my willingness to take on this kind of gig,” she said.
In March, Crypto.com spent an average of $109,000 per day on digital advertising, according to estimates from ad analytics platform Pathmatics. In May, that amount fell to $24,669 per day.
Spending at FTX, one of the crypto companies that has most aggressively used celebrity promoters, fell to $14,700 per day this month from $26,400 per day in March, according to Pathmatics.
“We kind of created this arms race,” Brett Harrison, president of the US branch of FTX, said about the use of celebrity endorsements in an interview with The New York Times ahead of the Super Bowl in February. Famous FTX brand ambassadors include Mr. David, Mr. Brady and his supermodel wife, Gisele Bündchen, golfer Albane Valenzuela, footballer Aaron Jones, basketball player Stephen Curry and baseball player Shohei Ohtani.
“We’ve planted our flag there and we have such a presence that the race to grab all the remaining properties, athletes and celebrities isn’t necessarily our top priority,” he said.
But the company, which would “most likely spend a lot more” on marketing, is now focused on reaching different demographics and pursuing more low-key tactics, such as digital campaigns and Google ads, he said. declared.
“We think we’re doing things a little differently than we’ve done in the past,” he said.