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What is Web3?

Web3 is the trendy new term buzzing around the internet and is set to become a household term soon. To explain what Web3 is, we need to take a couple of steps back to the beginning of the internet and see how the internet has evolved.

  • Web1 could be summed up with the word ‘Communicate’ – the birth of the first websites and email.
  • Web2 was about ‘Connection’ – the rise of Social Media and sharing.
  • So Web3 is all about ‘Community’ – taking the behemoth that is the internet and focusing on smaller ‘special interest groups.

The Web3 concept evolved from Blockchain technology – particularly on the Ethereum Chain – which allows individuals to be part of a virtual economy. Having a blockchain address (or wallet address) to engage with other services & people provides digital credibility to that address owner. Blockchain addresses are transparent, and any holdings are public, although the owner of these addresses can remain anonymous. With wallets like Metamask, web3 users can connect to countless virtual communities based on their particular interests, such as art, fashion, or investments.

To become part of any community, the user must own (or purchase) a membership – called an NFT or Non-Fungible Token. NFTs are becoming relatively well known through the purchase of digital arts or pictures – but in reality, the purchase represents exclusive membership access to a particular blockchain contract held by a community group. This membership gives the owner access to a specific community and its affiliated communities. The whole process is automated by connecting your wallet to a particular site. If the site recognises the token, then the user gains access to the site and the benefits associated with that membership.

So how is this relevant to our normal everyday life? Let’s use an example. Businesses use vouchers to reach prospective customers via EDM, SMM or SEM activities.  This is a ‘product-centric’ promotion, and it costs time and money to reach its target market. More importantly, it’s transactional marketing; once the transaction has occurred, the customer may never return. Yes, there are annoying remarketing tools to harass these people – trying to get them to come back –  but then the brand risks developing negative frequency, and they may never see that customer again.

With web3, the marketing process is reversed, becoming ‘customer-centric. It starts with targeting specific relevant communities, e.g. cars, cosmetics or more specifically targeting certain brands; like Disney or Adidas. Innovative businesses pitch their special offer directly to the communities – having recognised them as their ideal target market. If the community accepts the proposal, members can visit the business’ own digital platform to become their web3 member, or they can buy their product and services via a Web2-based e-commerce transaction validated by their web3 wallet to access these special offers. So no more random coupons and spending money on digital broadcast marketing to harvest customers – it’s a targeted reach, connection and transaction.

You may ask: How can my business adapt to this new technology? At this stage, it’s not ideal for every small business as Web3 communities are yet to develop to maturity fully. However, even small businesses offering Bluechip brands can now access these communities if they have the proper digital infrastructure.

At Digital Elements, we have web3 solid credibility and are one of the early adaptors of rapidly evolving technology. Our Web3 strategic planning services are available to all our clients, so make contact and see how this new world can work for you.

by Dom Ogun | 01.03.22