How Businesses can Use Web 3.0 Technology to Gain a Competitive Edge – Finextra

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Web 3.0 is the third version of the internet, which many tech enthusiasts have been excitedly talking about for years. It’s been described as the ‘decentralized web’ and ‘the semantic web’ and has been spoken about as the potential solution to the current web domination by the so called ‘big tech companies.’ 
There are many high hopes placed on Web 3.0, particularly when it comes to increased user privacy and better online security. But there are also many additional benefits of the technology that underpins it—centered predominantly on blockchain and AR—which businesses are already using now. 
What technology is in the Web 3.0 stack? 
While it’s still too early to know the exact Web 3.0 tech stack, we do know that it will bring about revolutionary backend changes and we can make assumptions about its structure. Unlike its predecessors, the Web 3.0 blockchain stack has a decentralized network which is highly user-centric. As it will be governed by peer-to-peer technology, it means that knowledge won’t be controlled by any individual entity. There will be no centralized servers, with data being instead spread among individual devices belonging to internet users. Individual freedom and consumer privacy on the world wide web will become increasingly important.

Why companies should embrace Web 3.0 
Here are just a few reasons that we came up with based on the work we’ve conducted at 10Clouds with blockchain-based companies of all sizes.   
Improving user journeys
The blockchain technology that underpins Web 3.0 can also be used to provide users with simpler and more user friendly onboarding processes. A good example of how this works is using your Facebook login for access to many other websites. Blockchain uses the same approach, but with the important difference that unlike Facebook and many tech giants, it doesn’t store users’ information. This is because under blockchain every end user owns their own data. Ultimately, the benefit to you as a business is that consumers will have a simple way to sign into the website, and you won’t have to worry about storing any data at your end. In doing so, you’re removing any data security issues. 
Beyond onboarding, Web 3.0’s tech stack (as shown above) will aid in the creation of efficient and effective customer journeys. The use of artificial intelligence will enable certain elements of the process to be automated, meaning that businesses will be able to allocate resources more efficiently to the parts that require human involvement.  
Building customer trust
There’s been a recent report published by KPMG about customers’ growing unease about company data collection practices. Among the business leaders surveyed, 62% felt that their companies should do more about data privacy. A third of them said that consumers should be more concerned about how their data is used by their company, while 29% admitted that their company has sometimes used unethical means to collect private data.
This shows how important it is for businesses to focus on consumer privacy, and what better way to restore trust and place yourself ahead of the competition, then by using the blockchain technology utilized in Web 3.0? Storing consumer data on blockchain makes that data automatically decentralized and therefore transparent. It is also more likely to protect it from  data breaches and identity theft. Some blockchain experts believe that returning data ownership to consumers might even disrupt the tech industry. Many tech giants which previously held huge amounts of data would likely lose access to the very thing that made them stay competitive. 
Smart contracts on the blockchain network play a key part in this equation. They are self-executing contracts, which means that the terms of the agreement between the buyer and the seller are directly written into lines of code. It’s important to note that all transactions are trackable and irreversible. Smart contracts save time and conflict; and they are cheaper, faster and more secure than traditional payment systems.

Improved knowledge of your customers
Arguably, Web 3.0 allows companies to collect less ‘hard’ data on their customers, because it eliminates the need for third-party ID verification. However, it actually offers a new approach to engaging with customers and collecting valuable information about their behavior. Instead of relying on stored data, and ad-supported marketing models, companies can use a decentralized model to align economics across all users. The Web 3.0 approach supports user-generated digital content and user interaction which will also likely make consumers more open. Businesses will be able to tap into these voluntarily published preferences and adapt their product-market fit accordingly. 
Innovating through NFTs and the metaverse
Non-fungible tokens (NFTs) both in their traditional and fractional form have taken the world by storm, but businesses are just beginning to explore their uses. 
NFTs are non-interchangeable units of data stored on a blockchain. They can be used to represent real-world items like artwork and real-estate. Because they are based on blockchains, NFTs can operate without intermediaries, connecting artists directly with audiences. Their nature means that they can also simplify transactions, and create new markets.
NFTs are already being used by some savvy businesses as a new method of digital marketing. They’re using NFTs which are associated with a virtual product to help boost the sales of that product. The video game industry is a good example of this, as it’s rapidly growing in global popularity and is a prime space for reaching new audiences. Luxury brands allow consumers to buy virtual versions of products that appear in games (within the cyber universe) before their real-life counterparts (the physical objects) are available in the market. This is a fantastic way to create buzz and get people to sign up to the wait lists of products and it’s just one example of how Web 3.0 will bring the digital world and the physical world closer.
There are also further uses of the tech stack that Web 3.0 has to offer which can be put to good use by businesses. For example, Google is constantly working on the development of its augmented and virtual reality technology. In the context of geolocation, this can produce 3D maps to help customers find your business. 
Saving your company money
Web 3.0 is all about putting data and content back in the hands of the users, and diminishing reliance on big tech. For SMEs in particular, the network effects that Web 3.0 will bring, will help to insulate them from the threat placed by major technology players. It will mean that they won’t have to pay the high fees that they currently pay for intermediary services (such as those in the delivery sector), referrals (such as travel bookings), advertising and more. With the influence of the monopoly waning, they will also have increased bargaining power. All of this will ultimately lead to better products and services with fairer pricing. 
Start embracing Web 3.0 today
There are numerous small businesses, scale ups and enterprises out there already putting the emerging technologies of Web 3.0 to good use. Why not tap into it yourself before the dawn of the new internet and start gaining your competitive advantage? Our advice is to focus on one of the above-mentioned areas and brainstorm how you might redefine your user experience using these technologies. 
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Head of Sales & Blockchain Lead
10Clouds
Member since
25 Nov 2021
Location
Warsaw
Blog posts
2
11 Feb
26 Nov 2021
This post is from a series of posts in the group:
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Yahya Mohamed Mao
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