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Technological developments have always had a profound impact on the way companies operate. The spread of the internet led to the introduction of digital marketing. The development of artificial intelligence changed the way companies interact with their customers. And now Web3 is poised to revolutionize the way the Internet as a whole works.
Web3 is being touted as the turning point of the modern internet and is expected to rediscover cyberspace as we know it. What can a company expect from the successor to Web2.0, the internet to which we have become accustomed?
Related: Web3.0: The Next Big Thing?
What is Web3?
Before we get into how Web3 is expected to affect small businesses, let’s talk about what Web3 really is. It is a blockchain-powered internet that provides a decentralized alternative to the web as we know it.
Although it is still in the early stages of development, Web3 solves what seems to be the most difficult problem with the Internet today. It provides better data privacy by eliminating central organizations and allowing users to keep their data in their personal crypto wallets.
So while Web3 may not completely replace the Internet today, it could provide a more secure alternative and cause an exodus of second- to third-generation users from the Internet.
Advantages of Web3
Web3 is still in the works. So all its benefits are currently rooted in theories and the potential of blockchain technology. If the technology develops as Big Techs had assumed, these benefits could be realized, leading to a massive shift in business processes.
1. No Third Party Involvement
Small businesses rarely have the resources to collect their own data, so they resort to third-party data mining companies.
Such third-party data is costly and rarely accurate. 86% of companies that use third-party data find it incorrect. And data inaccuracy adds to the cost of data-driven operations. This is why “dirty” data affects 88% of business results and causes an average company to lose 12% of its revenue.
Blockchain eliminates third-party involvement, just as cryptocurrencies have largely eliminated banks’ participation in monetary transactions. Likewise, Web3 is expected to eradicate third-party data brokers by enabling P2P connections and decentralized systems that allow businesses to connect directly to their customers.
In this way, companies can collect data directly from the source, for free or at a lower price compared to what data brokers charge. The accuracy of data, even at a lower cost, can lead to better strategies, which can ultimately be reflected in business results.
2. Strengthen Cyber ​​Security
Cybersecurity is a threat in the online shopping arena. People are skeptical about sharing their information because malicious parties cannot steal it. And companies run the risk of hefty fines for failing to comply with regulations.
British Airways facing as many as $26 million fine in 2018 for failing to protect sensitive consumer data. Proponents of Web3 claim that this next-generation Internet will solve this problem.
Because the entire infrastructure is decentralized, Web3 doesn’t have any weaknesses that hackers can exploit and get their hands on critical information. Blockchain technology makes it difficult for cybercriminals to penetrate networks and manipulate or steal sensitive information.
3. Well-built customer trust
Web3 eliminates third-party data brokers who rarely consider consumer privacy. These companies often mine data without notifying users and then monetize it. Companies that buy this data leave their customers skeptical about trusting them.
Web3 solves this problem by removing data brokers from the equation. If everything goes according to theory, companies can collect data from the customers themselves and apply better operational transparency.
94% of shoppers remain loyal to companies that operate transparently, while 73% are willing to pay a higher price to companies that remain transparent. Therefore, Web3 can enable businesses to build and maintain consumer trust, which is an important source of income in any era.
4. Better customer experience
Customer experience is and remains one of the most important variables in a company’s success equation.
As critical as it is, 63% of digital marketers struggle with developing a good customer experience, even with the ready availability of data. With browser cookies crumbling, data collection is expected to become much more difficult than it is today, which can make personalizing the customer experience even more of a challenge.
Web3 can solve this problem due to the easy availability of data. It can help marketers get critical customer data without offending them. And when used properly, this data can help deliver a more personalized experience that the users crave.
Ever since 48% of buyers are more inclined to companies that personalize their communications, which can lead to better customer acquisition and ultimately more profit.
5. Improved Supply Chain
57% of companies have poor visibility into their supply chain.
Blockchain technology, the backbone of web3.0, distributes data across all nodes in a network. This eliminates information silos and improves data transparency throughout the supply chain.
Once supply chains are more transparent, businesses may experience a reduction in relevant costs and an increase in supply chain efficiency due to better traceability.
Related: Web 3.0 Is Coming And Here’s What That Really Means For You
Last words
The next generation of the internet is upon us, ready to rise and usher in a new era of business.
Small businesses need to keep up with the latest trends and learn the best they can about blockchain technology. In addition, they should try to innovate their processes in line with the available technologies so that they may be better positioned to use newer technologies that may come in the future.
This can help them avoid being left behind by the big tech companies that are already investing huge sums in these futuristic technologies.
Janice has been with businesskinda for 5 years, writing copy for client websites, blog posts, EDMs and other mediums to engage readers and encourage action. By collaborating with clients, our SEO manager and the wider businesskinda team, Janice seeks to understand an audience before creating memorable, persuasive copy.