Web3 platforms directly incentivize users to perform tasks through quests. Quests are the most popular advertising unit among web3 marketing teams now.

There are many similarities between quests and popular web2 ads in the mobile space. These analogies can help web3 marketers build better campaigns. Also, the comparison can shed light on the future of the web3 martech industry.

Let's dig in.

Quests - The web3 most popular ad unit

Quests are the native ad unit of web3. They allow to compensate users to perform actions in dapps with tokens, NFTs or other kind of web3 rewards.

In the short history of web3 application, user incentivization is evolving quickly:

• Liquidity mining. Synthetix and Compound invented this approach which is still super popular for defi apps go to market. The main features of this programs is a reward based on app utilization,without data-driven and anti-sybil dynamics.

• Quests. The first quests,  publicly available by platforms such as Galxe and Rabbithole, were rewarding users for social and on-chain interation. They are mostly available in quest market placesthat match airdrop hunters and users and (so far) have poor targeting and sybil protection mechanism. The vast majority of web3 teams currently use quest to acquire and retain users.

• Data driven, distributed quest. Platforms like Tide iterates on the quest model by making it more data driven and improve the distribution with widget and SDK. In this way, user incentivization will more data driven, iterative approach.

Rewarded ads

Rewarded ads are the web2 equivalent of quests. This ad unit is used in mobile games to have users engage and interact with applicationsin exchange for in app-tokens, multipliers, extra lives. A popular example is watching a video to receive in game credits (rewardable video)

Offerwalls, on the other hand, are spaces that aggregate rewarded ads opportunities and are integrated in apps for additional revenues.

Rewarded video in particular are very popular and have competitive returns for advertisers.

Tactical lessons from rewarded ads

We suggest anyone looking to build effective campaigns tolook at the google admob docs. We adapted Google best practices for the web3 world:

• Discoverability: your ad should go to an area of higher user traffic. Ideally, it should be connected to the user journey to incentivize on-chain conversion events
• Reward design: Clearly state what the eventual reward would be and how it will be relevant to the users. Effective quests are part of the onboarding or conversion journey and rewards should unlock special benefits for users (rather than being free money) to keep engaging with the app. An example: gas fee rebates. Making rewards variables add gamificationand quest replays
• A small touch will go a long way: Leverage seasonality (eg. Winter campaigns) and include your branding in thecampaign to make the app work better
• Retention: Increase session time by increasing variety ofrewards and their variability. Dynamic NFT campaigns are an example. We alreadyhave seen examples of badly design quest