The web has gone through several iterations over the years.
While the earliest version – Web 1.0 allowed anyone with an internet connection to publish their own static website, the next big revolution – Web 2.0 emphasized interactive websites, social media, and user-generated content.
This propelled businesses to go online and transform the retail industry entirely as we see it today.
However, as technology is ever-evolving, we are now at the edge of another fundamental shift – Web 3.0.
In this blog post, we discuss Web 3.0 implications for eCommerce and how you should prepare for it to make the most for your business.
What Is Web 3.0?
To put it simply, Web 3.0 is the next generation of internet technology. It is driven by a decentralized computing network and technologies like Artificial Intelligence, Sensors, 5G, Cloud, and Augmented and Virtual Reality. Web 3.0 maps the physical world into a virtual space to create an intelligent, autonomous, connected, and open internet.
Components of Web 3.0 Impacting eCommerce
At the core of Web 3.0 transformation are various components that affect eCommerce businesses in various ways.
The What – Blockchain is a decentralized public ledger that tracks and stores data related to transactions. It uses chunks of information, chain-linked together, to confirm ownership without compromising user privacy. It is nearly impossible for the information on the system to be changed, hacked, or manipulated by anyone.
The How – Blockchain has far-reaching implications for eCommerce logistics. With decentralized ledgers, the need for expensive third-party intermediaries will be eliminated. This will drastically reduce costs for eCommerce companies with complex shipping needs.
The What – Cryptocurrency is a digital or virtual currency that uses a peer-to-peer system to facilitate transactions. It puts money on the blockchain which decentralizes financial ownership, that is, outside the control of government and central authorities. It uses cryptography to secure transactions and purchases without third parties.
The How – According to reports, over 300[i] million people worldwide use/own cryptocurrency as of 2022. One study found that 40%[ii] of people using cryptocurrency are buying from a company for the first time and that too with an average order value twice that of credit cards. This indicates that accepting cryptocurrency will boost customer trust in your eCommerce company.
Non-Fungible Tokens (NFTs)
The What – NFT is a unique digital identifier that represents real-world items like artwork and real estate. It is recorded in the blockchain and can be transferred or sold by the owner. But unlike cryptocurrency, it is not traded at equivalency.
The How – NFTs are essentially modern-day customer avatars. Digital ownership through tokenization lets customers feel like they own a piece of the pie. NFTs have various applications for eCommerce, including:
- Sale of collector’s items
- Prelaunch of physical products
- Digital duplicates for the Metaverse
- Loyalty programs for interchangeable use of rewards
AR, VR, and 3D AI
The What – The mix of Augmented Reality, Virtual Reality, and 3D Artificial Intelligence helps create immersive virtual experiences that can mimic the real world. Also known as the Metaverse, it is a shared space where users can interact, trade, and explore through their digital reproductions.
The How – Metaverse and related technologies are ideal for building customer communities. As a result, buying virtual products becomes gratifying for users as they help create a sense of belonging. Furthermore, leveraging these technologies for eCommerce stores can help potential customers experience the product virtually before buying.
Future of eCommerce in the Web 3.0 Era
Blockchain technology will improve transparency on all levels. The open and decentralized network of Web 3.0 will enable sellers to be more transparent to their customers, thus, enhancing brand trust. Merchants will be able to better track the supply chain and improve communication with their vendors and suppliers.
With Web 3.0, eCommerce businesses will have consumer-owned blockchain data about their personas and preferences. This data will provide better insights into customer intent and behavior. So, brands will be able to deliver hyper-personalized and relevant messages that fit customers’ needs best.
Customers have to enter a lot of personal information in order to complete online transactions. This information can be compromised at any time with sophisticated techniques. However, blockchain wraps this data with several layers of security which ensures the utmost financial safety.
Intuitive Shopping Experiences
Web 3.0 will open up many new possibilities to enhance customer experiences. For instance, shoppers will be able to virtually experience the look and feel of products before committing to the real thing. It will enable them to make more informed decisions, reducing return rates.
How Brands Should Prepare for Web 3.0?
Now that we know what opportunities Web 3.0 brings along for eCommerce businesses, it is time to know how to prepare for them.
- Start learning about new technologies to understand Web 3.0.
- Use blockchain technology to streamline supply chain management.
- Accept cryptocurrency as payment to increase customer base.
- Offer exclusive virtual products for use in the Metaverse.
- Gamify customers’ shopping experience to enhance engagement.
- Introduce NFT-based programs to build brand loyalty.
The Final Note
Many technologies of Web 3.0 have already found applications on the internet ‒ just not to the scale envisioned for the new version. This makes it the best time to embrace them in your business to get a leg up on your competition. Are you ready to step into Web 3.0?
Want to Integrate Cutting-Edge Technologies in Your eCommerce Store? Let Us Help.
At Grazitti, our eCommerce team has helped a slew of businesses build and optimize modern-day eCommerce solutions that take their operations to the next level. Should you want to learn more, just drop us a line at [email protected] and we’ll take it from there.
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