As we continue to enter the digital age, a new Internet age is emerging: web3.
Much of it is (and probably is) up in the air, but one question we can try to answer now is what it means for marketers.
Let’s break down what web3 is, when it launched, and how it will impact marketers in the short and long term.
What is Web3?
Web Three, or the third generation of the internet, is a vision for a more decentralized web that puts power in the hands of users rather than big tech companies like Google, Amazon, and Netflix. It is built on a blockchain using existing infrastructure with the goal of making the internet more accessible, private and secure for users.
To understand what it is, let’s take a trip down memory lane.
In the late 90’s, the world was introduced to the first version of the Internet. It’s not as complicated as it is today, with just basic fonts, grey buttons and blue hyperlinks. Very reminiscent of how websites load into HTML today.
It then morphed into Web 2 around 2005, a phase in which consumers could consume content in unprecedented ways on blogs and, later, social media.
However, as the Internet has grown, so have the methods businesses use to market to consumers online. This has led to growing privacy concerns among consumers, who struggle to trust the data in the hands of brands.
While the FTC has put some guardrails around data privacy, there are still plenty of issues that keep consumers on their toes.
Take a look at the evolution of Amazon. What was once an online bookstore has been transformed into a tech conglomerate with a foray into e-commerce, digital streaming, cloud computing and artificial intelligence.
Delving into the business, comedian Hasan Minaj argued on his Netflix show “Patriot Act” that Amazon controls the most important commodity of the 21st century: data.
“Data about how we spend our money and what parts of the internet we’re using,” he said.
For many, this is a scary realization. That’s where Web3 comes in.
The goal is that this new iteration of the internet will enable consumers to own and operate technology platforms themselves, rather than relying on big tech companies to sacrifice their data.
How does this actually work? Through cryptocurrencies (also known as tokens) and blockchain.
Essentially, when you own a coin, you own a piece of the network called a blockchain. The more tokens you own, the more control you have over the network and its direction.
On a day-to-day basis, tokens will play a role in most, if not all, digital interactions, from social media and gaming to digital art and events.
Critics of this approach say it’s just a covert attempt at decentralization, as power remains in the hands of the few with the most money.
When will Web3 launch?
Short answer: we don’t know. Discussions about web3 have been going on for years, but it’s still in its infancy.
Much of the infrastructure needed to make it a reality is still under construction, and there is no firm timeline for when it will be completed.
So why the sudden humming? Well, cryptocurrencies are booming right now. In fact, according to a New York Times article, venture capitalists invested more than $27 billion in crypto-related projects in 2021.
So the idea of building the internet around it got everyone talking.
How Web3 Impacts Marketers
1. Limited access to user data
In the short term, web3 could mean more data privacy for users.
Currently, companies make money based on the data they collect from users. Either use it to support their marketing strategy or sell it to third parties.
Proponents of web3 argue that, given the enormous value of data, consumers should take a more active role in how their data is used and with whom it is shared.
Will this make it harder for marketers to collect consumer data? possible. This will force marketers to be more transparent about data collection and use, while finding new and creative ways to reach target audiences.
2. A more community-centred approach
Web3 is all about redistributing power to ordinary consumers.
The idea is that instead of sitting in the passenger seat, consumers will decide and promote the ideas they are most interested in. With this shift, marketers will have to rely more on building a strong community.
As distrust of brands and the way they use data increases, community is more important than ever.
3. Greater reliance on content creators
Currently, many content creators feel at the mercy of the platforms they publish on, which have strict guidelines on what they can publish to limit their earning potential. Web3 will give them full autonomy.
In a CMS Wire article, Charlie Neer of MIQ, a leading programmatic media partner, explains the shift.
“Currently, when a person downloads a song, the creator gets a fraction of the total revenue, and the host (think Spotify or Apple Music) is like a bandit,” said the chief revenue officer. “The same goes for creators on YouTube, Twitch, etc. This will change rapidly with the Web 3.0 revenue model, and content creators will be in control.”
Of course, we are still a long way from web3 becoming a reality. However, this is something marketers need to be aware of and pay close attention to.