The Celebrity Hype Machine Collides With Crypto Hysteria. What Could Possibly Go Wrong?
Three decades ago, Spike Lee said, “It’s gotta be the shoes!” As the iconic character Mars Blackmon, Lee made Nike’s Air Jordan ads a cultural phenomenon. The premise was simple: Michael Jordan, arguably the best basketball player ever, used these shoes and put his name on them, so if they were good enough for him, they were definitely good enough for you.
This past week, Lee appeared in another ad, this time for a far less-known brand. The Oscar-winning director used his signature dolly shot to shill for Coin Cloud, a company that makes kiosks for buying and selling cryptocurrency. “Old money is not going to pick us up; it pushes us down,” he says. “The digital rebellion is here.”
Lee isn’t the first celebrity to jump on the crytpocurrency bandwagon—far from it. Influencers like Kim Kardashian and Jake Paul have done paid ads on social media; actors like Neal Patrick Harris and Alec Baldwin have appeared in ads for Coinflip and eToro; and over the last few years Steven Seagal, Floyd Mayweather Jr., and DJ Khaled were charged with promoting crypto without disclosing that they were paid to do so.
The celebrity hype machine—particularly around a still nascent industry that’s not well understood by mainstream customers—hearkens back to the dot-com bubble, when celebrities like Anna Kournikova and Shaquille O’Neal shilled for websites that soon went belly-up.
R.A. Farrokhnia, Columbia Business School professor and executive director of Columbia Fintech Initiative, says crypto-based companies are at that in-between stage, where early-adopter hype has leveled off and they need to expand awareness in order to keep momentum growing. “If crypto is to become a mainstay product and offer a true alternative . . . it needs to reach a much wider audience,” Farrokhnia says. “So it’s no surprise we’re beginning to see that as the market matures within the early-adopter universe, they’re trying to widen the market and create more of a demand for the product.”
Farrokhnia says using celebrities in ads is a tried-and-true model, but the complexity of crypto changes things. “This is very different from a celebrity endorsing an energy drink,” he says. “Two words—energy and drink—describe the whole product, and you have the celebrity telling you why it’s better than Gatorade or whatever.”
Meanwhile, crypto’s complexity isn’t easily conveyed in a commercial—hence Spike Lee bellowing, “Do your own research!” for Coin Cloud. That kind of oversimplification led to a backlash against Lee’s spot. Some viewers questioned his claim that crypto is a financially liberating option for people of color. According to a 2021 study, the average cryptocurrency owner is a 38-year-old white male whose yearly salary is $111,000. In the spot Lee asks, “Where’s the women, the Black folks, and the people of color?” Yet Coin Cloud itself was called out for being led by a team of all white male executives.
HUH? Spike Lee directed a commercial about “Diversity" for #CoinCloud, A company founded by all WHITE MEN with almost 100% all WHITE male staff in Every key position & ownership? They hired 1 African American for marketing publicity. Diversify the Execs! pic.twitter.com/eEhRT50xzo
— Daniel Newmaη (@DanielNewman) July 14, 2021
Cleve Mesidor, who leads the National Policy Network of Women of Color in Blockchain, cautions big-name spokespeople against jumping at the hype. “Unfortunately, some Black and brown celebrities, athletes, and prominent figures are making endorsements driven by FOMO [fear of missing out], but they do not have a clear understanding of how vast, dynamic, and complex this industry truly is,” Mesidor said in an email to Fast Company. She points out that while women of color are the fastest-growing demographic in the blockchain and cryptocurrency marketplace, the crypto ecosystem has a racial diversity and gender inclusion problem, similar to the traditional tech sector. The disparity is most glaring on the product development and investment side.
“To make it even more complex, even crypto itself isn’t fully regulated yet,” Farrokhnia says. “It’s still up for debate whether something is a security or not a security, and the final interpretation by regulators . . . will dictate how it could be marketed and advertised and what the rules are. This poses reputational risks for both ad agencies and celebrities that are a part of these campaigns.”
There are clear parallels between these new crypto ads and the late ’90s tech boom, when all of a sudden the Super Bowl was full of ads for startups with names like OurBeginning.com, Epidemic.com, Autotrader.com, and, of course, Pets.com—new brands riding a much-hyped new technology that many in the audience had yet to understand or even use. There was even an alternative currency (remember when Whoopi Goldberg appeared in a commercial for Flooz?). It filed for bankruptcy in 2001.
Farrokhnia says these types of ads oversimplify the industry, and he also questions the marketing strategy of employing older celebrities like Baldwin or Lee to begin with. Unlike more modern takes on celebrity-brand partnerships, where there’s a clearer connection than just a check with a lot of zeros, this genre of crypto ads feels less like Ryan Reynolds’s Aviation Gin, and more like Tom Selleck pitching reverse mortgages. “Does the general population understand this product and ecosystem? Or will Alec Baldwin or Spike Lee convince them to get involved anyway? Is the trust achieved through the use of these celebrities in crypto?” Farrokhnia asks. “This isn’t Michael Jordan selling basketball sneakers.”
Crypto-related brands thinking about using celebrities to nab some quick-hit trust from potential customers would do better to look at how investment app Wealthsimple built a large, loyal user base over the last few years. The brand did invest in traditional advertising, but its primary focus was less about hype and more about educating young investors on financial health and literacy. And when it did dip into the celeb spokesperson-verse, it wasn’t a flashy movie star, but documentarian and Oscar winner Errol Morris directing spots that talked to real people about money. It also got big names like Anthony Bourdain, Rachel Bloom, and Woody Harrelson to write frankly about their own financial education. The brand’s executive creative director Mike Giepert told me at the time that it was all about trying to build an environment where people can openly talk about money. “Whether that’s a celebrity or a regular person, it’s about sharing experiences, hopes, and fears about money,” he said.
Cryptocurrency is clearly an area where mainstream consumers need more information that’s creatively delivered. Even Jackson Palmer, the creator of dogecoin, responded to the ad by calling the currency he helped create and popularize “an inherently right-wing, hyper-capitalistic technology built primarily to amplify the wealth of its proponents.” That’s not to say that crypto companies will start incorporating his rant, but it highlights the contradictions and complexities inherent in the burgeoning industry. All of that nuance is lost in Lee’s ad and others like it—and so is the opportunity to educate potential customers and get them excited about more than just the hype.
July 22 2021 | Jeff Beer