Understand Web 3.0, and improve Marketing Implications
Updated: Nov 14, 2022
Since a few years, the term web 3.0 has become recurrent into our information landscape.
However, it is not always easy to understand all its nuances nor to grasp the present or future impacts.
What are the implications of web 3.0 on the way we use the Internet?
Is it only related to the metaverse? And by the way, what is the metaverse?
Do I need to get any additional knowledge to access it, or any additional equipment?
And what impact and benefits does this have for me as a consumer?
We have all asked these questions, without necessarily finding clear and satisfactory answers.
Through this article I propose
To understand the history and the semantics behind the term web 3.0, in order to better understand it
To discover its challenges for both big companies and consumers
To understand the long-term impact on marketing!
The name web 3.0, where does it come from?
For there to be a web 3.0 it implies that there was a web 1.0 and a web 2.0
You’ll answer me: logical!
So, before going on with the understanding of web 3.0, let’s go back to the origins of the two previous ones.
The web 1.0 years took place between 1991 and 2004. At that time, the information available on the net was defined as “read only”, meaning that it was searchable information, but the user had no role to play other than that of reading the pages available. There was no online account or data collected and the advertising campaigns were hardly profitable for the advertisers.
As new needs were identified, the codes evolved and features were added. This was implemented in waves and adjustments, so that at the beginning of the 2000s, all of these new functionalities were identified as web 2.0.
It was in 2004, during the first conference dedicated to it, that the term web 2.0 was popularised by Tim O’Reilly and Dale Dougherty, who also put forward the notion of open source.
To put it simply, the web 2.0 functionalities enabled the interaction between the source and the user. This means that the user was no longer simply a passive reader of the content available online, he could also interact, post, participate, exchange with others… social networks were around the corner.
At that time, it also became important to start (finally) making the Internet profitable. As the user began to interact with online content, information about that user became available and quantifiable. Initially, external operators started to collect this information to help websites improve their performances. But very quickly, they realised that they could also resell this data to advertisers. From there began the targeted advertisement and, we have to admit, the loss of control of our private data. But let’s be fair, that was done with our full consent.
Over the years, targeting got better, using data collected through our smartphones - including geolocalisation and places we frequent - as well as artificial intelligence in order to predict some of our behaviours and centres of interest.
If we set it up, what stigmatises and characterises web 2.0 is
Interaction with the user, and his ability to exchange content
Data collection on this user
The possibility of ordering this data for advertising and other purposes
Web 3.0 is not yet as well defined as its predecessors, and there is still a lack of visibility as to its ultimate form. However, due to its technological specificity (such as the blockchain) we note a gap with web 2.0 in the sense that 3.0 is intended to be “decentralised”.
First of all, quick definitions of the terms blockchain, cryptocurrency and dApps which are at the centre of the web 3.0
Blockchain: the blockchain is an information recording system that is difficult to modify or track. It’s a register of digital transactions distributed within a given technology (there are a few).
Cryptocurrency: a cryptocurrency is a digital currency encrypted via an algorithm. It is used as real money and uses a virtual accounting system. Here as well, there are several kinds.
dApps: the dApps, or decentralised applications, are apps available on the blockchain or peer-to-peer.
In the context of web 2.0, the user “is the product”. The commercialisation of his data and behaviours are the key to commercial exchanges.
In web 3.0, the user is “his own owner”. He/she decides for him/herself, without giving external actors the possibility to centralise or commercialise his/her data.
>no resale of private data
> no targeted advertising
> a full autonomy in decision-making
But how is it possible?
Web 3.0 revolves around technologies of blockchain and cryptocurrencies, but also of dApps, only available on the blockchain. The central point of these technologies is that they are decentralised systems, offering the user full control on their own data.
The user can create one or several virtual identities completely disconnected from his true identity and operate through the web while maintaining his anonymity.
Specialists think that these transactions will be managed by decentralised groups called DAO (Decentralized Autonomous Organization). Basically, there are unregulated organisations that wish to be autonomous, without censorship, operating on the vote of their participants to prevent any hierarchical system.
Some think that in the long term, DAOs could replace GAFAMs.
For the moment, we have to admit that web 3.0, due to its technological complexity, is still hardly accessible to a wide audience and its development remains slow.
Financially speaking, it benefits the user above all and questions the entire commercial system built since 20 years. However, the big Internet companies are already positioning themselves and are trying to find ways to monetize these new systems.
And Marketing in all this?
Above all, it is important to differentiate marketing 3.0 from web 3.0. There’s between them both absolutely no correlation. Marketing 3.0 refers to totally different issues that are inherent to marketing, highlighting proximity to the consumer. But that will be the subject of a further article.
Then, it is important to (re)define the term of marketing and what it implies. To do so, let’s refer to an observation made by Forbes:
“These days, what most people consider marketing is really simply advertising. Search, email, content, and other common forms of marketing today are primarily methods for generating or maintaining awareness or repeat purchase.”
Source : Forbes - Marketing matters now more than ever
I repeat with my words… Yes, marketing implies communication advertising campaigns, a measurable presence on social networks. But it is not just that!
To fully understand the different stages of marketing in businesses, and more specifically in high-tech companies, I suggest you review my previous article - webinar on Marketing Impact, where I describe the product cycle and its marketing actions.
But in summary, marketing is a lot of work upstream of advertising campaigns broadcasted on social networks. It is:
Market researches, understanding and analysis of the competition landscape
Translation of the technology, and the added value of the product/service
Definition of the values of the company and its service
Business plan and G2M
Campaigns and lead generation
Analysis of the user behaviour
Backup on the product definition and the market evolution
So, if we transcribe the stages of a global marketing strategy to the specificities of web 3.0, we see some dissonances.
In the context of web 3.0 where the network expects to be decentralised, it is more difficult to collect information.
The product remains the same, what changes is the way the consumer will approach and discover its existence. The marketing issue lies on two main points
How to create, motivate the act of purchase while
Communication funnels become obsolete
The target is lost in the great ocean of the web with no way to correctly identify it
How to estimate your market if the data is no longer available
New difficulties - Finding your target and defining your market
We understand that decentralisation offers users a better control over their personal data and their behaviour. The protocol Follow works in this sense. Available on Ethereum, it gives Internet users the possibility to decide which information they want to leave open or not, whether it is their real identity or their data.
In this new environment, during brand communication and the generation of new leads, marketing needs
To develop new methods to approach potential consumers, without increasing their budget
To focus upstream on product more likely to be marketed in this new environment
Let’s be honest, there is no method yet to properly answer these new requirements. This will take a few more years. On the other hand, there are a few examples of campaigns that have produced great success on the metaverse.
We have chosen the example of Nike, which tests new trends and generates acts of purchases from the virtual world toward the real world.
Less than a year ago, Nike announced the acquisition of an NFT studio, RTFKT, in order to merge the brand with the gaming culture. Among other things, they collaborated with the artist FEWOCIOUS to create a new collection of sneakers, sold both in real and in the NFTs. In less than 6 minutes, the brand made a net profit of more than 3 million dollars.
Understand who are the current users and consumers of web 3.0
In conclusion of the marketing action made by Nike, we understand several things
There is money circulating on these new networks - lots of money!
It goes fast
The graphical environment is crucial - and more precisely 3D graphics
We also note that it is the big brands, with big budgets, that can set up the kind of marketing we just saw with Nike, as this involves:
Adequacy between the brand and the new environment
A long term strategy, involving
The development of a 3D visual universe, very well polished
Association with or acquisition of complementary and specialised forces in the new broadcasting technologies
An advanced logistics to generate real production very fast, in parallel with the immediate perception observed on the networks
In the light of these few facts, whether those are technological or aesthetic, it is easy to see that
It is still restricted the public of the web 3.0 users and consumers. But things are moving fast, technologies evolve every day, and since 10 years they are in development, the question is not any more “will web 3.0 be more democratic?” but “when will web 3.0 will be more democratic?”
The real world is taking more and more inspiration from the virtual to create new tendencies and stimulate the act of purchase
The new generation is demanding
Web 3.0 exists, but it is still in the trenches. Technologies are being developed, consumer behaviours are greedy but not yet very assertive. On the other hand, what is certain is that the major players are already in the starting blocks and are trying to draw up the rules. Indeed, if last year Facebook changed its name to become meta, while web 3.0 announces the end of GAFAM, it is certainly not to shoot itself in the foot…
For more information on how to adapt and better consider your marketing strategy, contact us.