Why your business needs to embrace Web3 technology in 2023

Web3 is the next chapter in the evolution of the internet. It's transforming how users interact with brands, products, information, and each other.

Although the past months have been rough for the Web3 ecosystem, experts claim that Web3 technology has the potential to empower consumers and revolutionize business models, allowing companies to:

• Generate more value for their customers
• Increase customer engagement?
• Develop a whole new range of products and services
• Convert customers into brand advocates through incentives
• Create new ownership models
• Develop web3-native Marketing actions & Sales strategies

Web3 innovation is taking place rapidly, and adoption is expected to accelerate. This article covers why your business should embrace Web3 tech in 2023 and how it can significantly improve customer relationships.

Why your business should embrace Web3?

Web3 is more than the Metaverse, cryptocurrencies, and NFTs. It’s a confluence of technologies that aim to shift power back to the users through ownership and decentralization.?

A 2020 post on Twitter said it best:?

• Web1 was read-only
• Web2 is read-write?
• Web3 will be read-write-own?

There are many ways to define Web3, but fundamentally it is a decentralized internet owned by builders and users.?

The global Web3 market was worth approximately $3.2 billion in 2021 and is projected to grow exponentially throughout this decade as new technologies are adopted.

CitiGroup has estimated that the total addressable market for Web3 will be somewhere between $8 trillion and $13 trillion by 2030.

Web3 is changing how brands connect with customers and is expected to radically alter how we think about online presence and the consumption of products and services.?

Global consultancy firm PwC sees Web3 as a truly decentralized ecosystem where users have ownership and control of their assets, enabled by emerging technologies.

Companies that leverage this technology will gain a substantial advantage, similar to how certain brands tapped influencers and social media in the early days.

The Three Keys of Web3?

Web3 use cases for brands are based on three key elements.

• Ownership: Web3 enables a new ownership model, where digital assets become more like physical possessions. People can take their digital goods wherever they go and transfer them to others at any time.
• Aligned incentives: Web3 supports tighter bonds between brands and customers. One-way connections and linear subscriptions go away, allowing businesses to create new and more actively involved brand advocates. An influencer, for instance, might choose to promote a brand or product because of incentives beyond money, like equity or co-branding opportunities.
• Community: Loyalty programs, incentives, and rewards created through tokenization produce a more involved community. Businesses can create a new class of super-loyalty. Collaborative communities can generate online content & actions that aid marketing teams, and the more involved members are likely to increase transactions in the physical world.

Creating Real Value for Customers

We are experiencing a paradigm shift where users expect greater value & personalization from products and services.

Brands must rethink and expand how they view customer interactions. In a recent article, PwC sustains that Web3 technology introduces a two-way interaction channel, providing several avenues to engage with audiences.?

In this sense, companies have the opportunity to reshape their relationships with customers and see them as partners rather than just consumers or subscribers.

According to a McKinsey study, 71% of customers expect personalization in their interactions with brands.

The added value will likely come in the form of consumer empowerment through data sharing, ownership, portability, and equity.

Digital assets and Metaverse experiences will likely lead this customer-brand interaction, allowing customers to earn rewards and enjoy unique physical and digital experiences.

We will see interoperability playing a more significant role in business-to-customer relationships, allowing companies to plug into broader content networks and expand the value they can provide their audience.?

As users acquire true ownership over assets and data, they will start to demand to be able to use their digital possessions across different platforms and applications. And businesses that decide to satisfy these needs will be able to gain a substantial competitive edge.

Getting the most out of Web3 technology

Enhanced Loyalty programs

By leveraging Web3 technology, brands can develop enhanced loyalty programs tailored to their customers.?

Options are virtually endless. A Web3 loyalty program can include NFT collectibles, cryptocurrency rewards, and exclusive access to physical and digital experiences for purchasing specific goods or services.

This type of initiative not only brings value to customers' experience with your products but can also create new revenue streams since NFTs can trigger an economy of tradable assets within the blockchain ecosystem.?

At the same time, a loyalty program enabling digital ownership can invite new users into the marketing funnel driving additional revenue.

A great example of a well-put Web3-based loyalty program is Starbucks Odyssey. This is Starbucks' first major attempt at integrating Web3 tech into its existing rewards program, allowing customers to collect NFTs and points that unlock exclusive digital and physical benefits and immersive experiences.

Web3-enhanced Digital Experiences

Web3 technology can revolutionize how brands showcase, promote, and sell products and services. NFTs and Metaverse allow companies to create unparalleled experiences available 24/7 and accessible from any device.

A Metaverse-native experience can be whatever you imagine. It can be a 3D store built into your company website or an interactive journey providing new ways to connect with your customer base.

Many top-tier companies like Coca-Cola, Nike, Starbucks, and Disney already use Web3 technology and the Metaverse to create memorable experiences and bring value to their audiences.

Nike, for example, launched an NFT project giving customers access to physical goods that, once purchased, unlock new features on their digital avatars and a set of experiences in the Metaverse.

Web3 technology offers a whole new level of engagement possibilities and immersive experiences. If your company is among the first to embrace it, it will give you a substantial advantage over competitors.

The Phygital Revolution

One of the most interesting applications of Web3 technology for businesses is phygital assets. The term “Phygital” combines physical and digital and refers to real-world items backed by NFTs that work as its digital twin.

Thanks to blockchain technology, it's possible to own goods in both the physical and virtual worlds, and it's also possible to create new and enhanced types of ownership.

Every object you own can have a digital counterpart: your clothes, your house, your valuable collectibles.

Over the past year, many companies have explored this type of physical+digital collection. Global fashion company Gucci, for example, launched a successful web3 project called Gucci Vault, which is an experimental store offering phygital assets.

The collection was dropped in October, and Gucci NFT holders had the opportunity to access an exclusive pre-order stage. The brand is also currently working on an interactive Metaverse experience.

This new type of ownership model can potentially change how consumers and brands interact. Phygitals may also allow companies to create a perpetual revenue stream, as NFTs assets can be bought and sold endlessly on a secondary market.?

"Web3 is in its infancy. Over the next few years, we expect a company's online presence to depend heavily on digital ownership and transactions." Said PwC on this aspect.

Token-Gating & NFT Ticketing

Another interesting use case for NFTs is their application as digital tickets and passes for exclusive events, live shows, and social gatherings. Thanks to blockchain technology, NFTs can make tickets more functional and easier to collect for memories.

The Coachella Music Festival, Las Vegas Afterparty, and ETH Denver are renowned events that have implemented this technology and are good examples of how NFTs could become the entry point into cultural & entertainment events in 2023 and beyond.

Web3 experts point out various reasons why NFT tickets are a better alternative to the traditional system. Paper-based tickets can be lost, ruined due to water, or destroyed. Moreover, organizers do not get enough security with paper-based tickets since they can be easily faked.

By using NFT technology, event organizers can easily mint the required number of tickets on their blockchain of choice without major changes in production costs. They can code the NFTs to set a sale price or run the sale as an auction where people can bid for the tokens. Plus, the NFT assets can become collectible pieces, adding value to the customer experience.?

Here's a quick list of the main benefits of NFT Ticketing:

• Preventing fake tickets and scams
• Reduce production costs
• Faster production
• Perpetual revenue in secondary sales
• New revenue opportunities

Join the Web3 Revolution

Web3 technology is changing marketing and sales strategies forever. That’s why you must start thinking about implementing Web3 technology into your business processes to enhance your value proposition, improve your products, increase your brand awareness, and build lasting relationships with your customers.

At NFT Studios, we design and develop innovative Web3 projects and immersive digital experiences in the Metaverse, allowing any brand to establish a digital presence.?

We have worked with renowned companies like Sotheby's, Consensys, AMD, and top-tier artists like Pak, Hackatao, and Tom Sachs, helping them develop and launch ground-breaking projects.

If you have a Metaverse project in mind, don't hesitate to contact us here.

Article written & edited by Guillermo Vidal Quinteiro