Over the past few months, we’ve seen wide press coverage around two dominant tech-forces each vying to represent the next generation of the internet, namely the metaverse and Web3.
Many people assume they are the same thing – they’re not, although they are intertwined.
Web3 primarily focuses on shifting power from the big tech companies to individual users by rebuilding the internet with blockchain’s decentralised protocols, whereas the metaverse is a catch-all for creating a limitless 3D immersive world for enhanced consumer experiences.
The marketing press has tended to gravitate its interest towards the shiny metaverse – it’s an easier picture to both engage and sell to the brand and advertising community. Web3 is more abstract and cerebral, but marketers need to understand it because if it does break through, its impact upon the whole marketing ecosystem and consumers will be far greater than anything experienced through the metaverse.
Web3 is born out of a desire to seek a new internet alternative to the existing massive digital walled gardens created by the big tech players, in which user data extraction and perceived Big Brother controls prevail.
Using blockchain technology, Web3 is built upon the philosophy of the decentralisation of data to ensure no one entity can ever have a monopoly of ownership, thus permitting users to have much greater freedom, exchange and collaboration over their own data, assets and content.
By giving people ‘immutable’ control over their own data, they themselves get to determine its value and how it’s used. Not only can they set their own terms for the exchange or sharing of their data, users can also set the price of some of this data through a token system. Most data assets can be tokenized including gaming characters, memes, music albums, photos and digital art. And the more tokens owned, the more influence the owner has within their specific community over things such as governance and lending protocols.
Why is all this relevant to the marketing and advertising industry?
Well, if consumers embrace a new decentralised Web3 future where the control switches to the user, there will be a redistribution of power away from the big-tech companies towards a more peer to peer community led ecosystem. In such an environment there will be no dominant control of data, which will open-up a new digital society built on strong cultural values of sharing, equality and altruism.
Most critically for the advertising industry, Web3 could eliminate the need for brands to work through third parties – it will allow them to engage directly with consumers and build deeper loyalty through highly tailored communication campaigns that don’t necessarily need to follow big-tech formalities.
On the other hand, where there is no central control, brands also need to consider that a new permission-less internet running completely on blockchain could lead to a whole host of challenges including lack of regulation, technical compatibility and cybercrime.
Web3 is evolving very quickly and it will certainly play a role in defining the future marketing landscape – including the metaverse. It’s not easy to predict how significant its impact will be and some of its claims certainly feel far-fetched.
But ignore it at your peril. According to reports, a number of investors have already bet $27 billion that Web3 is the future of the internet.
David Patton is the former global president of CX and Advertising at Technicolor Creative Studios, where he led The Mill and MPC Advertising. Previously he was global president Y&R, president Grey EMEA and SVP Sony Europe.