Understanding Web3 Analytics: Gathering Relevant and Actionable Data in a Decentralized World

Welcome to our tenth edition of Blockmate Academy! We hope you’ve enjoyed reading and that it’s been a useful resource for your fintech growth and success.?This week we’re diving deep?into Web3 data.?

Access to relevant, up-to-date data is an essential component of business success. This is especially true for startups that are looking to define their place in the market and get an early edge over the competition.?

By?James Caunt

Effective user analytics helps businesses to understand how their customers interact with their products, apps, website, and other marketing channels to make more accurate, data-based decisions.?

That’s why tools like Google Analytics are a staple weapon in every marketer’s arsenal. They can choose the metrics most relevant to their marketing strategy and instantly access actionable data in an easily digestible format.??

So far, so Web2.??

However, with more and more developers and businesses making the transition to decentralized Web3 protocols, our approach to analytics needs to change with it.??

Is there a Web3 equivalent to Google Analytics? Not yet. But solutions are on the way.?

Challenges of collecting Web3 data?

Data ownership is one of the three core values of Web3. Rather than sensitive user data being gathered, harvested, and sold by centralized entities, as is the norm today, Web3 users keep their identities largely anonymous.??

They interact using multiple disconnected wallet addresses and pseudo-anonymous social media profiles. User profiles are fragmented across multiple blockchains and protocols and are difficult to trace.??

With a commitment to decentralization and data ownership, Web3 companies gather user data in a totally different way. Personal identity-based metrics like age, gender, marital status, and so on are now irrelevant and unnecessary.??

In their place are new metrics such as community engagement, NFT ownership, wallet balance, human/bot behavior, and more.??

Key Web3 metrics?

Relevant Web3 metrics will naturally vary depending on your particular use case. However, there are a few key metrics that all projects should keep an eye on, whether you’re into gaming, NFTs, DeFi, or any other Web3 protocol.??

• Total number of users: See how many wallets have signed up for your app. Keep track of user growth to measure the performance of your marketing campaigns.??
• Active users: Identify those who are actively using your app. Track users by hourly, daily, weekly, and monthly interactions. Reach out to new wallets with airdrops, free NFTs, and more to encourage interactions.??
• New users: Measure new wallet connections and the time it takes for them to start making transactions/purchases related to your app.??
• Bots: Heavy botting can skew user numbers, ruining the accuracy of your analytics and misdirecting valuable resources. Identify the bots from the humans and learn your true user numbers.??
• Location distribution: Discover where your users are signing up from. Target your marketing to your most active locations and customize your messages in the languages that your users are using.??
• User profiles: Identify users that have connected their social media accounts to their wallets. Reach out to them with targeted messaging and deals on Twitter, Discord, or other popular platforms.??
• Account balances: Target high-value users and boost retention with special deals and rewards for activity. Having a group of high-value users or “whales” in your community is essential for attracting new users and providing liquidity for new projects. Consider having a special whale chat for these users and encourage them to contribute ideas/investments to drive your business forward.??
• Risk scoring: Identify problem users with a history of fraud or bad behavior. Blockmate, for example, gives each wallet a risk score based on their connections and previous transaction behavior.??
• Transactions: Track in-app transactions and find out what users are responding to most. Segment users by their preferences and learn which marketing strategies are most effective.??

The importance of community in Web3?

Community is another founding principle of Web3. The relationship between business and customer is different in a decentralized environment. Rather than a strictly transactional business/customer relationship, many Web3 businesses are governed by Decentralized Autonomous Organizations (DAOs).??

DAO membership is usually governed by the ownership of a particular NFT or number of tokens. Senior members are voted on by the community and given the opportunity to participate directly in decision-making processes. The health (level of activity, quality of investors, education about the product, etc.) of your community is paramount to business success in Web3.??

User analytics will play an important role in the DAOs of the future. Web3 businesses will need to identify their most active, influential, and valuable users to build communities that best represent their values and goals. They’ll want to incentivize good behavior with rewards for productive wallets and easily track community members who act in bad faith.??

Forward-thinking fintechs that provide Web3 analytics apps specializing in community-building and DAO governance will be in high demand. Consider this as you expand your services and user base into Web3 protocols.?

How to gather Web3 data?

The third core value of Web3 is transparency. All on-chain activities are publicly available on an open blockchain ledger. Anyone can go to a blockchain explorer and type in a wallet address to access its full transaction history.??

Sounds a bit scary? It needn’t be. Because unless a user actively links their wallet address to social media profiles or other personal identifiers, the wallet remains anonymous. It could belong to anybody. This means that businesses can freely access and collect Web3 data without compromising user identity.??

Of course, manually checking every user's wallet and searching their transactions would be a time-consuming and inefficient use of time.??

That’s where Web3 API providers like Blockmate come in. We’ve recently released a comprehensive analytics suite that gathers, consolidates, and presents the most useful Web3 data in an easily readable format. Is this the closest thing to Google Analytics for Web3 so far? We’d like to think so!??

Web3 companies can use Blockmate Analytics to get a detailed breakdown of their user base. From acquisition to engagement, retention, and monetization, every step of the customer journey can be mapped out with a customizable dashboard. You can either use our pre-built dashboard or use the API endpoints to build your own customs analytics app.??

And if you want to get even more granular with your data and apply it to specific use cases, you can check out DeepSonar.io. Whether you’re a developer, have launched an NFT collection, or are creating a Web3 gaming platform, this custom analytics tool can provide you with the specialized metrics you need for your particular project.??

Web3 data has never been so accessible and easy to interpret!?

Web3 analytics: same same, but different?

User analytics will be just as crucial in Web3 as it currently is in Web2. However, things like decentralization and data ownership have changed the game. Community-focused business models introduce a whole new category of metrics to measure and interpret.??

And while there’s nothing as comprehensive as Google Analytics just yet, new tools like Blockmate Analytics are quickly bridging the gap. With just a few clicks, you can quickly and easily understand the dynamics of your user base. This will help you to build better, more productive relationships with your community and grow your revenue with personalized and relevant marketing.??

Curious? Create a free account today and try our brand-new analytics tool — Blockmate Analytics!!?