Despite the setbacks caused by the 2022 crypto crash, Web3 continues to intrigue marketers, particularly in the activewear and luxury brand sectors.
Based on the principles of decentralized applications and blockchain technology, Web3 offers ownership of data and digital assets, opening up new opportunities for innovative initiatives by different brands.
In a recent interview with Insider, Byron Sorrells, CEO and co-founder of Dispatch, a platform facilitating friction-free purchases in various digital experiences, said that the 2022 crash provided a much-needed distinction between speculation and the real utility of Web3 technology.
Sorrells claimed that he sees Web3 as a technology that augments existing practices rather than entirely replacing them.
"It's a shame it took these big events for that to happen, but you do start to see that what's survived are some genuine use cases," he said.
"Web3 is not just some big wholesale replacement for what we used to do. It's just new technology that can augment the things we've always done."
CMOs, however, face the challenge of navigating the abundance of available technologies.
Marija Zivanovic-Smith, the CMO at IEX Group, has mentioned that there is a need for Web3 providers to address specific business problems faced by brands and marketers, rather than simply offering technology solutions.
Zivanovic-Smith highlighted the importance of solving issues such as declining accuracy in targeting algorithms due to changes like Apple's removal of cookies.
"It's solving for increasing digital loyalty, solving for the problems that we're facing with losing 30% accuracy on targeting algorithms when Apple did away with cookies," Zivanovic-Smith said.
Web3 Adoption Slows Down
Matt Moorut, a director and analyst at Gartner, noted that Web3 adoption is experiencing a slower pace compared to the peak of metaverse hype 12 to 18 months ago.
Ongoing crypto volatility and concerns about inflation have led marketers to approach Web3 cautiously, focusing on use cases where the technology can bring value to their organizations.
"It's not to say Web3 is dead," Moorut said.
Marketers are still interested, "but rather than rushing forward with it, they're being more sensible and trying to unpick those use cases where Web3 technologies are still valuable for the organization."
Moorut pointed out that activewear and luxury brands have been at the forefront of Web3 adoption.
Companies like Nike and Adidas were early adopters, integrating blockchain technology into loyalty programs and building communities around it.
Nike's .Swoosh community, launched in November 2022, allows members to engage in online and real-world activations, interact with Nike athletes and creatives, and use virtual Nike gear in games.
Nike's Our Force 1 virtual collection, co-created with the community, was introduced in April 2023.
Despite these brand successes, consumer engagement with Web3 endeavors continues to remain relatively low, primarily attracting a young, affluent, and male demographic.
Moorut noted that the number of consumers using NFTs or owning crypto wallets is still limited compared to the total population.
"Until there's a big sea change in the consumer adoption, it's going to be kind of an edge case for a marketer, versus the core of most retailers' business," he added.