Is Web3 a buzzword or an opportunity?
In just over a month’s time, the biggest cryptocurrency exchange in the world, FTX, collapsed. Meta cut 13% of its workforce. The fintech company Plaid laid off 20% of its staff. And Twitter? Half its workforce is gone.
What went wrong?
Not the technology. Companies stumble and fail all the time. And tech firms may be even more vulnerable than others since they’re riding out front. These giants misstepped in many ways —leadership, governance, change management — but the underlying technologies are still solid.
Web3 is worth pursuing, for companies of every size.
What is Web3? A brief Web3 explainer
What exactly is Web3? And how is this next iteration of the web different?
During Web 1.0, users published on the web without interacting with others. It was like posting a flyer on a webpage instead of on a phone pole.
Web 2.0 got a little more social. Platforms were created to help users create and share content (i.e., post on Facebook, Tweet or drop a DM). The downside of Web 2.0 has been that personal user data can be scraped and sold, allowing companies to make huge profits selling targeted advertising. Plus, users don’t always own the content they buy or create online. Your gaming ID can be deleted, or someone can suspend your Facebook or Twitter account.
In Web3, the internet will be permissionless and decentralized, meaning there will be no governing body or hall monitor. Users will be free to interact, publicly or privately, however they want. Users will create, own and sell content without intermediaries like Google or Facebook.
Blockchain, AI, cryptocurrency and non-fungible tokens are the underlying technologies of Web3. They give users more ownership and power over their interactions. They also have groundbreaking business applications — if the business, its data and governance are managed well.
Is there a downside to Web3?
Some argue the world needs a hall monitor. A series of failures by FTX is providing a case study of “What could go wrong?” as we speak.
Without some regulation, Web3 could also enable harassment and abuse. And the permanency of digital records isn’t appealing to everyone (and may not fly in Europe, where users have a right to have personal data erased).
And who should be the hall monitor of the digital world? That’s still unclear.
As with other technology evolutions, the full roadmap isn’t ready at the start of the journey. We can’t predict how far some of these technologies will go — but that’s not a reason to slam on the brakes. Early adopters, like FTX, are creating a laundry list of lessons learned. Their failures are platforms to grow from — not for the technology to die on.
Organizations that sit on the sidelines in fear and dig their heels in to resist change will be the ones left behind. Now is the time to take those lessons, double down and focus on the Web3 future.
How to prepare your business for Web3
Web3’s supporting technologies are changing business models, and the first step of Web3 is to ensure you have a strong foundation in good data practices.
If you don’t have good data now or know how to use it properly, then you’ll be in trouble tomorrow because that data — and the need for it — is only going to exponentially grow.
Right now, we gather and store tactical data — like all the clicks a customer makes, what device they’re using or where they live and how old they are. With Web3 and metaverse interactions, we’ll be able to gather more emotional data and use AI to increasingly understand human language — all so we can better attract, serve and retain customers.
To make sure you’re ready, focus on these four digital fundamentals:
- Customer-centricity: Customer experience and customer engagement should drive your technology roadmap. Processes, tools and channels must support the customer journey, so make sure that you truly understand your customers and their experiences with you.
- Governance: You can’t make good decisions off bad data. Establish solid data ownership and governance practices to ensure data quality and consistency. This becomes more important as the types and volume of data grow.
- Security: Businesses need to protect their data assets every time and everywhere they engage. This includes customer and employee data, as well as financial and operational records.
- Building institutional knowledge: Every interaction is a chance to know customers and understand operations better. Invest in people, processes and technology that use data to drive value.
Web3 is not a fad or a trendy new buzzword. Web3 (and the generations that follow) will deliver revolutionary opportunities for businesses.
How Wipfli can help
Wipfli’s team of digital innovators, can help assess where you are and help build a realistic roadmap of where you need to go — and ensure you get there. We partner with organizations to truly understand your unique needs, and we build a relationship with you so that we are there at every inflection point in your business. Learn more about our digital services.
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