Over the years, Web3 has gained momentum as an innovative technology that can help brands build cultural relevance, tap into community, and unlock novel revenue streams. Despite the initial hype, followed by a pronounced "crypto winter," the dust has now settled to make way for more pragmatic and effective applications of the technology—particularly in the realm of commerce.
By enabling shoppable experiences that are deeply intertwined with brand narratives and cultural identities, the blockchain is redefining the very concept of value. As brands aim to gain deeper insights into their customers and create more relevant experiences, the adoption and effective use of Web3 shifts from an optional tactic to a fundamental requirement. In a recent episode of The Nex6 Project, Michael Litman, Senior Director of Emerging Tech Strategy, sat down with John Ghiorso, SVP, Strategic Advisor & Evangelist of Global Ecommerce, where they discussed how Web3 is evolving brands’ approach to commerce.
Web3 is transforming brand-consumer relationships.
When discussing the role of Web3 in facilitating community building, Litman highlights what he refers to as "the four C's": creativity, culture, community, and commerce. Emphasizing the significance of relationships in branding, he states, “In Web3, this dynamic relationship between the brand and the consumer transforms into a more robust, two-way relationship, where consumers actively engage, creating a reciprocal exchange.” The transparency provided by blockchain technology thus enhances the connection between brands and consumers.
Dom Pérignon realized this when they partnered with us to build an exclusive Web3 marketplace inspired by their collaboration with Lady Gaga—a move that enhanced the brand's cultural relevance. We furnished the high-quality immersive web platform with 100 NFTs that represented the Dom Pérignon Vintage 2010 and Dom Pérignon Rosé Vintage 2006 collections, and every NFT purchase was bundled with a purchase of the bottle depicted.
By linking the NFT purchase to the physical bottle, Dom Pérignon created an additional revenue stream for themselves while also giving consumers the chance to pocket digital collectibles that could be exchanged on the secondary market—where they grew their value by nearly 1500%. The shoppable experience effectively bridged the gap between the virtual and the real world while establishing Dom Pérignon as a pioneer in the Web3 space.
Dom Pérignon is not the sole beneficiary of embracing Web3. The prestigious jewelry brand Tiffany and Co. seized the opportunity within Web3 early on by tapping into the existing community of CryptoPunks holders and crafting a tokenized reward exclusively for them. The NFTs, cleverly named NFTiffs, were unleashed to 250 holders, allowing them to collect these unique digital assets and trade them for real-world customizable gold pendants. Tiffany and Co. made history as the first brand to intertwine fine jewelry with the digital world, with NFTiffs selling out in just 20 minutes at a mint price of 30 ETH, raking in an impressive $12.5 million in revenue.
These use cases essentially create these community-driven programs that deliver business value and benefit. We’re not talking about just community for the sake of people being part of something; there is generally business outcome and goals tied to that community driving aspect.
Beyond standard ecommerce, Web3 enables entirely new shoppable experiences.
As brands use Web3 to tap into communities and drive cultural relevance, the space enables boundless opportunities for interactive, communal experiences in commerce that have never been possible before—especially as digital shopping experiences become more social, with global social commerce sales expected to reach nearly $1.3 billion this year.
But what makes Web3 unique compared to typical forms of social commerce? Essentially, says Ghiorso, it’s about giving consumers a space to interact with one another while keeping the brand at the forefront. “What really amplifies this is the community aspect. This one-to-many, many-to-one network gives the brand and their community the ability to conduct commerce effectively between those various consumer touchpoints.”
Macy’s has done an excellent job building these kinds of spaces for multi-user, communal interaction with the brand at the forefront. We partnered with the department store to virtualize its iconic Thanksgiving Day Parade in 2022, including a virtual Sixth Avenue featuring parade balloons inspired by the year’s most popular Web3 communities: Cool Cats, Boss Beauties, VeeFriends, and more. In addition to enjoying the parade, visitors had the chance to enter virtual storefronts and buy digital collectibles of their own, with each purchase benefitting Big Brothers Big Sisters of America. If they chose, they could resell those collectibles in Web3 resale platforms like OpenSea and more. Macy’s efforts show how Web3 capabilities can inspire a new class of shoppable, social experiences—and gave the retailer an entirely new product category to sell.
Other brands can do something similar by exploring ways to incorporate elements of Web3 into their existing strategies, similar to how Macy’s used its Thanksgiving Day Parade as inspiration for its own Web3 efforts. Brands can also explore ways to incorporate elements of Web3 into their existing strategies. This could involve creating an NFT for a brand, launching a blockchain-based loyalty program, or even creating token-gated experiences that can potentially drive a negative cost per acquisition, a disruptive shift from traditional commerce. "The lightbulb moment for me was when I found that in many cases, consumers are willing to pay upfront for limited access to token-gated physical products," says Litman. "What that means is they’re effectively crowdfunding, and the success of that program or project will be dependent on those upfront sales. Because of that delayed value exchange, it gives the brand time to get it right, get all the logistics and the distribution in place before they need to ship anything out.”
Unearth a trove of customer insights on the blockchain.
In addition to building relationships with communities, Web3 commerce has the potential to forge a deeper understanding of customers on the individual level—precisely when traditional means of following customer journeys, like third-party cookies, are no longer as reliable. In contrast, the blockchain’s transparent nature means businesses can gain more insight into consumers’ behavior, preferences, and purchasing patterns to inform personalized marketing strategies.
“Your Web3 wallet will become as ubiquitous as your email address, and it will provide this linkage between purchasing offline, online, and on-chain. That, to me, feels like an absolute data goldmine,” says Litman. It will take time for that to become a reality, but it is important for marketers to begin incorporating Web3 into their long-term strategic planning as they begin to envision alternative ways of learning about their audiences and connecting the customer journey.
In collaboration with Salesforce—who helps brands enter the Web3 space through a familiar, secure and trusted interface—we released a report that demonstrates how Web3 not only enhances experiences across the customer journey but also helps brands build key insights into their audience. As brands continue to beef up their customer relationship management to better understand their customers and lay the data foundations required for AI implementation, accounting for Web3 serves as another way to future-proof one’s efforts and adapt to emerging consumer behaviors.
The Web3 revolution won’t happen overnight—but brands can prepare now.
Beyond the NFT craze of 2022, the blockchain is transitioning from a speculative hype cycle to an integral part of brands’ strategies that is helping them build cultural relevance, deepen customer relationships, and ultimately enable new commerce experiences. "Many brands out there will have their own token that then has a value associated with it," says Litman. But for now, it’s imperative that brands swiftly recognize the value of Web3, and then adapt their strategies accordingly: the speculative nature of blockchain is evolving into a foundational element for the future of generational culture, community, and commerce.
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