Why Is Binance Interested in Cristiano Ronaldo & Khaby Lame
On June 24, 2022, Khaby Lame surpassed Charli D’Amelio as the most followed TikToker, within the same week, Binance the world’s largest crypto platform announced a partnership with Khaby Lame as their brand ambassador, alongside the most followed person on Instagram - Cristiano Ronaldo.
“I consider my followers as my family, and I am always looking for new challenges and interesting content to share with them. I’ve been curious about web3 and jumped at the chance to partner with a leader like Binance because it aligns perfectly with what I usually do: make complex stuff easy and fun for everyone!” Khaby Lame
Today we’ll cover
Binance Rationale with Cristiano & Khaby Lame
Psychological Effectiveness from Influencer Marketing
Reputation Alignment/Risk from Brand Deals
Binance Rationale with Cristiano Ronaldo & Khaby Lame
The goal of the two exclusive influencer partnerships for binance is to raise awareness and introduce crypto (and launch their own NFTs) to the mass audience. However, while both influencers are becoming multi-year brand ambassadors for binance, the framing and approach for each deal are dramatically different.
From the messaging side, for Khaby, the brand partnership positioned him to be the #binanceman - onboarding Web3 and crypto to everyday people. For Ronaldo, Binance emphasized fan engagement and interactions through a flagship NFT collection drop. From the demographic side, for Khaby, the execution takes place primarily on TikTok for a younger pool of audience who are intellectually curious. For Ronaldo, it targets avid soccer fans who aspire to be rich and successful.
Though many brand sponsorships figures are private (i.e. Khaby: HugoBoss, Netflix, AmazonPrime; Ronaldo: Nike, Herbalife, DAZN), there are some numbers that could help contextualize the range of the deal:
Khaby back earned $4 million through TikTok in 2021
Ronaldo signed a $1 billion contract ($20M for 50 Years) with Nike in 2016
Conservatively speaking, the two deals will at least be valued at $10M/year each, given the price premium as the deal involves influencers releasing NFTs, the multi-year structure and the effort required to perform these campaigns.
Psychological Effectiveness from Influencer Marketing
To evaluate the ROI/ROAS of influencer campaigns, you can simply divide converted customer lifetime value by the budget spent on the campaign. However, it doesn’t capture other important factors such as awareness and interest.
The advent of online advertising, worked very effectively because there are tons of information asymmetry - which means that customers are making inadequate purchasing decisions with very little information about the options they have.
However, as information became more available and organized, the effectiveness of ads has declined. Brands realized generating awareness is not enough. To improve conversions, they have to focus on developing interest and desire. For competitive products with high customer lifetime value, such as credit cards (Current, Step Mobile), exchanges (FTX, Binance) and subscriptions (Grammarly, Betterhelp), influencer marketing campaigns are so much more effective when the products are widely endorsed by your favourite creators.
Reputation Alignment/Risk
Fans’ trust in a creator can change drastically depending on the reputation of the brands they promote. Creators are known to be model figures for their fans and like many celebrities, any on-screen/off-screen interactions can affect their reputation in both directions. Therefore, creators are careful with what kind of brands are they working with. During an interview with Colin & Samir, Yes Theory said they have said no to 99% of the brands because they only wanted to work with brands that not only can afford to pay a large sum, but the brands are building products that resonate with the creator him/herself and the audience. Common views are shared by MKPHD too.
Johnny Harris: Betterhelp, SquareSpace, SurfShark VPN
MrBeast: Current, Honey, BrawlStars
Ur Mom Ashley: Gatorade Fit, Verb Energy, Pandora Jewelry
Reputation management is critical within social platforms. Another interesting phenomenon is that many creators are reluctant to disclose their religions and political beliefs. (Why Aren’t Influencers Talking About Roe vs Wade (Rolling Stone)) It is mostly because no matter which side they choose, there will be a part of the audience base who walk away.
Takeaway
Today in the marketing world, generating awareness is not enough. The best way to generate interest and desire is through creator endorsements. On the other hand, creators need to be cognizant of the brands that they work with, as the brand-creator association can be a double-edged sword, which can drive the audience closer and away.
💡 This Week's News In the Creator Economy
Reddit is launching a new NFT aviator marketplace
MrBeast is hosting a League of Legends stream contest with Ninja
Twitter enabled co-tweet features
Amazon is experimenting with live commerce during Prime Day 2022
Over 1 million consumers unsubscribed to music streaming platforms
Elon Musk terminated the Twitter takeover deal
Chris Brown launched an NFT collection and only sold 3% of them
✌️ That’s it until next time!
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