As a society, people are increasingly becoming more tech-savvy. But at the same time, the internet also keeps on evolving –which means staying “up to date” doesn’t have an “end date.” This is especially true when it comes to keeping up with technology that isn’t here yet, but when developed could make a great impact. For example, Web3 – also known as Web 3.0, or the third generation of the internet – is currently a work in progress, but once developed could change online life as we know it.
Plan B believes that as Web3 evolves, it is important for brands and marketers to understand it so that if/when it comes to fruition, they are ready to take on any challenge or advantage it may present. So we’ve created this primer to get you up to speed.
What is Web3?
Coined by Polkadot and Ethereum co-founder Gavin Wood, in 2014, as a “decentralized ecosystem-based blockchain,” Web3 is a new iteration of the World Wide Web which incorporates decentralization, blockchain technologies, and token-based economies.
Some commentators say Web3’s decentralization features will provide users with increased data security, scalability, and privacy which will help them combat the influence of large technology companies. In a nutshell, Web3’s potential to create an internet that takes away the power from big corporations and places the users in control of their data is what has made it so appealing.
How Did Web3 Evolve?
Evolved from Web 1.0 and Web 2.0, Web 3.0 is the third generation of the web. Even so, each of these generations are refered to as eras in the history of the world wide web in which it has evolved through various technologies and formats. Web 1.0 refers to the time period from 1989 to 2004 in which most sites consisted of static, or read-only, pages and the majority of users were consumers, not producers of content.
Web 2.0 on the other hand, refers to the time from 2004 until the present when the internet was transformed from a read-model to a read-and-write model. For example, Web 2.0 centers on user-created content uploaded to forums, social media, and networking sites such as Facebook, Instagram, and YouTube. On all of these platforms, the ability to like, comment, and interact is what makes these a written model.
With companies like Facebook and Instagram owned by Meta, and YouTube by Google, Web 2.0 is described by journalists as a place where data content is centralized in a small group of companies referred to as “Big Tech.” In contrast, Web 3.0 is described as the opposite of Web 2.0 and as a possible solution to the concerns about the over-centralization of data.
What Does A Decentralized Web Actually Look Like?
Visions vary for what Web3 would look like, but many of them revolve around the idea of decentralization of payment structure. As stated in a policy brief published by the Bennett Institute for Public Policy at the University of Cambridge, Web3 is “the putative next generation of the web’s technical, legal, and payments infrastructure – including blockchain, smart contracts and cryptocurrencies.”
More specifically, there are three main visions worth understanding when deconstructing what Web3 would look like if it came to be. The first theme is decentralized autonomous organizations (DAOs), or leaderless online groups that collectively pool capital and make decisions all while not being under government control or supervision. The next theme is Decentralized finance (DeFi), which are platforms that allow individuals the ability to exchange currency without bank or government involvement. The last theme to understand is Self-sovereign identity, an approach to digital identity that gives users control over the information they use to prove who they are on websites. This allows users to identify themselves without relying on an authentication system such as OAuth, in which a trusted party has to be reached in order to assess identity.
Why Should Marketers Care About Web3?
After gaining a greater understanding of what a decentralized Web would look like, there are two main impacts Web3 could have on marketing that are worth noting. Those two areas are personalized user experience and data privacy and collection. When it comes to personalized user experiences, which are a major part of Web3, marketers will have to prepare strategies to leverage decentralization so they can craft the most effective targeting possible.
Data collection would be greatly impacted if users became in control of their data because marketers rely heavily on tracking to target users with campaigns. For example, brands like Google make 80% of their revenue from advertisements and if their ability to target those consumers became interrupted, their whole business model could be greatly impacted. For this reason, businesses would need to focus on community marketing or the idea of creating a loyal community to build trust so they can continue to leverage their data for marketing purposes.
While it is unknown whether Web3 will be here tomorrow or years from now, if it became a reality, it could greatly improve users’ ability to surf the web freely. But with this freedom for consumers, brands’ ability to target them could be negatively impacted. Since consumer targeting can make or break the success of a brand, Plan B recommends marketers take steps to familiarize themselves with and monitor changes to Web3 in order to be prepared for whatever the future of our internet holds.