Web 3.0, as a term and set of technologies, is gaining significant popularity these days, especially due to the early takeoff of blockchain technology and cryptocurrencies. Brands are trying to figure out the potential and pitfalls of this rapidly changing landscape, while Venture Capitalists are clamoring for new investment ideas in the space.
Web 3.0 is an umbrella term used to describe “Read, Write, and Interact” with the web for all the needs of the user, eliminating large intermediaries. Sometimes Web 3.0 and Blockchain are used synonymously, but in actuality, several other technologies like Edge Computing, AI/ML, Decentralization, and Blockchain are all part of Web 3.0.
How Did We Get Here?
For background, let’s look at how we got to the stage of Web 3.0:
- Web 1.0 was the early internet and as per many definitions, it was the “Read Only” web, allowing users to only view information published on a website. There was no way to interact with that content. One of the most easily recognized site example in this 1.0 phase was Craigslist – a static site when it first launched.
- Web 2.0 and 2.5 is our current stage of the Web with “Read-Write” functionality. Users can interact with sites and apps, and other users. Social media platforms, chat rooms, and most modern-day mobile applications with interaction touchpoints are examples. While users are able to create and share content themselves, they do not have complete autonomy of the content once published.
- Web 3.0 is the future of “Read-Write and Interact” on a decentralized web where you can read, write, and interact including on 3D applications. This marks a change where computers no longer simply store information but can now understand it. Early examples are already part of our consumer and professional lives with Apple’s Siri and AI advertising platforms
What Will It Look Like?
Web 3.0 will offer the following benefits to the users with the underlying technology:
- Open: The software and applications can be built by a community of developers and fully crowd-created, bringing more transparency and less of the black box
- Trustless & Permissionless: The network allows all the users to engage without any intermediary permission or governing authority. The idea is that just a handful of companies could control the web experience for all and that users can take back control of their data and information
- Ubiquitous: The new web will be available to read, write and interact with its AI and distributed application capabilities
Now, let’s look at how Web 3.0 is affecting digital marketing practices. As a reminder, some of the technologies like AI/ML, Edge Computing are already being adapted in MarTech tools to support various business cases, like personalization, to a segment of one. Other technologies like Blockchain are being experimented widely in the fields of media advertising, data management, and loyalty rewards.
How Will Web 3.0 Impact Digital Marketing?
In the arena of digital marketing, here are some potential impacts of the jump to Web 3.0 and how it will help marketing for brands. Please note that this is not a primer on how the technology works, rather it identifies areas where digital marketing can benefit.
- First, it will offer identity protection to individuals with Web 3.0 and blockchain technologies. Typical email id, password, and other ways of identifying individuals will go away and a new version of wallet ID will take over.
- Wallet address is essentially a string of random letters and numbers connected to blockchain and are typically used for cryptocurrency transactions.
- The wallet address will be extended for multiple other uses, and it can be used across multiple applications (distributed applications built on Web 3.0 technologies) to identify and authenticate the users. This will revolutionize authentication process and offers privacy to individuals yet maintaining identity.
- It will offer data security, making all data encrypted by default and therefore impenetrable. As consumers, if we are working on the applications built on Web 3.0, there is no reason to worry about your data given it is stored securely and safely across the nodes of the blockchain.
- Applications will offer consistent services from being developed and available as a distributed architecture. What this means is that the service can never go down, nor is there any centralized authority to stop the services. It is always on, making some of the mission-critical applications that need real-time data more accessible and available. Many marketing applications like CRM, distributed marketing, ratings and reviews, loyalty, advertising, customer experience, and personalization will be developed on Web 3.0 technologies very soon.
- Web 3.0 and blockchains are already making strides in promoting customer loyalty by offering tokens or NFTs as a reward for loyalty members. Most recently, Starbucks launched its odyssey platform that allows loyalty members to login and engage in various interactive games to receive rewards in the form of NFT stamps. These stamps can be also exchanged with other members of the community. This is going to be the next generation of loyalty and we will start seeing more and more brands experimenting in the NFT, token space.
- New marketing channels like the Metaverse will gain traction. Based on our experience, we are noticing more brands have started experimenting in the Metaverse space by creating a digital world and immersive experiences. This channel will give marketers a huge opportunity to leverage the visitor’s user data to promote loyalty and engagement with new demographics or to create innovative ways of engaging with current customers. Platforms like Roblox, Fortnite, Decentraland, Minecraft, and Meta’s Horizon Worlds are already strong communities of users and getting a lot of media publicity.
- Finally, we think that with the inception of Web 3.0, users will be able to create and control their own data via public/private block chains, only allowing other entities or authorities (including government) access to verify the data as needed. In this new world, users don’t have to worry about their data being copied across channels owned by one entity. Potential opportunity for a data breach is eliminated.
The evolution of Web 3.0 has accelerated significantly in the last 5-7 years, and we see no sign of that pace slowing. Web 3.0 is a reality. This means that the time is now to consider how best to interact with consumers who will begin taking back control of their own online data. We believe there will be more ways to engage safely, securely, and personally with consumers. More tangible marketing applications will become mainstream in the next 12 months.
