Web3, the next iteration of the World Wide Web that is coming to replace the current Web2 Internet, is about to change the marketing landscape for good. United with the Metaverse, another grandiose tech concept that is evolving right now, it has the potential to bring drastic changes to the advertising industry because many of the existing fundamental principles of digital marketing won’t work in that environment.
There are, of course, skeptics since most of the information we have about Web3 and the Metaverse is a lot of seemingly fragmented ideas that sound vague to the general audience. However, slowly but surely, this new cyberspace is taking shape and there are a lot of startups that are keen on developing solutions for it, like those cryptocurrency exchanges and NFT auction platforms.
Consequently, advertisers have to look for ways to adapt to the reality of Web3 and the Metaverse. And it’s not a bad thing. For years many advertisers have been striving to create meaningful content that promotes humanist values and addresses the most burning social issues as well as showcases the product and attracts consumers. Web3 is exactly the opportunity to make something meaningful since its main purpose is to create a socially responsible internet.
Addressing upcoming challenges, the AdTech industry is already working on solutions to help businesses gain awareness in the Metaverse with Web3 technologies.
Identity Crisis
First of all, we need to talk about a user’s identity because, to show targeted ads to a person, it’s necessary to identify who they are. It’s a huge challenge for advertisers since the Web3 ecosystem excludes any common means to verify a user, like third party cookies or mobile device identifiers. On the other hand, cookies are already coming out of favour among tech corporations. For instance, Google GOOGL has announced plans to get rid of third-party cookies in their browser Chrome by 2023 while Apple AAPL and Mozilla already switched off these cookies a few years ago.
In the digital space powered by blockchain, verifying a user’s identity will work differently and users will have much more control over their personal data than in Web2. It’s never easy to give predictions because future is always illusive, but a lot of experts agree that, since in Web3 a user’s identity is glued to their crypto wallet, people will use it to enter the Metaverse, so, there will be no need to log in via any centralaized platforms.
For advertisers it means that they need to look for alternative ways to get user data. While in Web2 there’s a limited number of large tech corporations that harvest users’ information and sell it to advertising platforms to target ads, in Web3 personal data can be shared only if allowed by its owner and strictly on their terms. It gives more power to the consumer and makes Web3 a more democratized version of the Internet.
This forthcoming shift has boosted the emergence of AdTech platforms that let users share their data in exchange for rewards, like tokens and NFTs. It may not be obvious, but collecting so-called zero-party data directly from users is beneficial for business because it’s more accurate and reliable.
Since Web3 understands the value of users and their data, it’s providing a lot of options to get rewards for or monetize what users do and have, including the content they produce. Take Brave browser, it pays 70% of the revenue it generates from targeted ads to users who watch them. Or let’s look at Tapestri Inc. which pays consumers for sharing their anonymized location history.
Rewards Marketing
In Web3 advertisers are already switching to rewards marketing. Not only to get users’ personal data but also to attract their attention and enhance brand loyalty. For example, there is Permission that connects brands and consumers through crypto rewards. It’s going to work especially well in the Metaverse because rewards can be fully digital, thus, they will be highly useful in the digital space.
Brands can grant loyal consumers with digital items, like virtual clothing and accessories, that can be worn by a user’s avatar in the Metaverse, or with invites to exclusive events that take place in the Metaverse. Using their crypto wallets, people will be able to take all their digital objects and assets with them wherever they go in the virtual space. Taking into account that it’s very likely there will be a number of metaverses, not just one, it seems to be quite convenient.
Also, there’s the option to give consumers NFTs that they can use later in the real world. Brands can gift users with NFTs that verify some exclusive discount in exchange for engagement and loyalty. After all, even though the Metaverse is a digital space, experiences that happen there may be taken to the real world or impact users’ life outside the virtual reality.
Gaming Strategies
Now we know that brands will be able to reach users in the Metaverse even in the Web3 era, but how? Advertisers can find answers in video games. Since a metaverse is a three-dimensional digital world that can be accessed via virtual reality gear, it strongly resembles video games, but with one major difference ― in a metaverse you don’t have any tasks and goals that constitute the gameplay in video games.
The industry of in-game advertising already exists and, in fact, is quite successful. The global in-game advertising market was valued at $6.8 billion, and it’s projected to reach $17.6 billion by 2030. By the way, gamers feel positive about ads within games: a report from Bidstack shows that 95% of gamers feel that ads enhance gameplay realism.
There are many options that can be borrowed from in-game advertising for the Metaverse. Video ads can be installed in the gaming process or resemble the real life advertising when being placed in the gaming environment. If you ever played video games, you know that their digital world often copies the real one, so they have billboards and other kinds of outdoor and indoor advertisements too.
Besides, in the Metaverse there will be many events where ads can be placed too. When rapper Travis Scott held a concert in the virtual world of Fortnite, it attracted 12.3 million users, and such an enormous audience is a dream for advertisers. The beautiful thing about metaverses is that they are highly inclusive because it’s easy to enter them wherever you are situated geographically.
Changes rarely happen overnight, and advertisers have some time before entering the Metaverse becomes inevitable. It gives the opportunity to look into the future and understand what strategies and tactics to adopt. Even more, since Web3 is already offering some AdTech solutions that can work in the Metaverse, it’s beneficial to start researching them now.