By Justin Wolf, Sr. Director, Marketing Technology Consulting, Merkle
Web 3.0 will be powered by new technologies, like blockchain and AI, and driven by new consumer demands for privacy, control, and immersive personalized experiences.
Today’s internet (Web 2.0) eliminated the physical characteristics of multidimensional communications, information, and transactions. This gave way to social media, ecommerce, and knowledge platforms, allowing us to enjoy peer-to-peer interactions on a global scale, all achieved by proprietary third-party networks. These centralized, curated web networks mined consumer data for profit and used it with little consent or knowledge of the consumer, adding to consumers’ concerns of who has their data and how it is used.
What is Web 3.0?
Web 3.0 is Web 2.0 without centralized servers and data silos. It’s a serverless internet, a decentralized web managed by technology and coded rules to support individuals’ transactions and actions. Web 3.0 leverages blockchain technology to reinvent the way we store and manage data over the internet, providing a universal state layer.
Blockchain is an emerging technology that will allow for more direct relationships and transactions with more control. There is no need for third-party service intermediaries like Google, Visa, Amazon, StubHub, etc. It will forever change the internet and how individuals interact with the internet, companies, and each other.
What makes blockchain different?
- The data documentation process
- The way blockchain creates trust in the data
- The removal of intermediaries
- The execution of rules based on code instead of intermediaries
Blockchain is a digital chain made of blocks of information (data) hosted on a decentralized and distributed network of computers. It can’t be altered, but it can be reviewed. Blockchains store information in batches called blocks. Unlike legacy systems that centralized the storage of information in books or database file stores, blockchain is designed to be decentralized and distributed across a large network of computers.
A blockchain system operates by showing the activities of people storing and transferring content from one block to another in an encrypted, secure way. It removes intermediaries by creating trusted peer-to-peer interactions. This saves time and money and enhances control. It’s this type of peer-to-peer interaction with consumer data that will revolutionize the way we access, verify, and transact with one another.
How to Use Blockchain for Marketing
A key to how blockchain can revolutionize some aspects of marketing and help us move to the next phase of the internet (3.0) is something called a smart contract. A smart contract is a program that runs on a blockchain. It’s a collection of code and data that reside at a specific address on the blockchain. This allows users to exchange anything of value in a transparent, conflict-free way without a middleman. The smart contract stored in a blockchain defines the rules and penalties around an agreement and automatically enforces those rules.
Leveraging blockchain for a digital universal ID
Today’s method of identifying prospects via third-party cookies is not reliable or secure, and it will soon not be a viable option. The internet today cannot manage identities of people, organizations, and objects, so most elements related to the consumer identity management process are being centralized by siloed service providers.
What does data management look like today?
- Web-based services (Google, Meta) provide their own proprietary ID management.
- All user related data is managed by the service provider, stored by the service provider, and distributed by the service provider.
There may be an alternative blockchain solution – a global digital ID leveraging blockchain. By using blockchain, individuals can create self-sovereign and encrypted digital identities that protect them from breaches and theft and eliminate the need for multiple usernames and passwords.
What are the benefits?
- Unique IDs
- Consent to use data
- Decentralized data
- A universal identity for each individual
- Individual monetization
Leveraging Blockchain to Enhance Digital Advertising Industry
Blockchain can greatly enhance the digital advertising industry. It can allow publishers to directly access consumer metadata to improve campaign efficiencies. This could potentially eliminate fraud by recording impressions on an immutable distribution ledger. Transparency is increased between parties via smart contracts. Both parties can transact with full trust, with better audience visibility. Lastly, blockchain allows users’ metadata to be anonymized, complying with privacy regulations and policies to ultimately give end users a great brand experience.
The next generation of internet (3.0) will very likely be built upon blockchain technologies. It will reinvent the way we store, access, and manage data over the internet, vastly empowering the individual and improving their web experience.