The Web3 must knows in 2023 for brands to get ahead
By Haifa Barbari. Top image: Adobe stock.
From marketing spend, the first steps of the evolving brand & customer experience, through to the gaming platform evolutions ahead that further open to and empowers the creator.
This is the year of integrating the first phase of web3 into the mass marketing ecosystem. Mark my words. While there are a number of insights into the movements in web3, there are 5 that are most notable that in 2023, that will change the marketing function and brand experience landscape across real and virtual worlds: Marketing spend, hiring, metaverse brand open source standards and gaming platform evolution (which I’ll go into one by one).
1. Marketing spend
80% of brands intend to spend up to 30% of their marketing budget on web3 in 2023.
Despite sitting on the precipice of a recession, the uncertainty of cryptocurrency value and safety on blockchain, and the admittedly confusing use of language in web3 - for example: NFTs, non fungible tokens that really mean, digital asset ownership, we’re sitting on the precipice of a shift in how brands and customers interact; it starts by looking at where the spend will go. According to Sitecore and Statista, some 80% of marketers in the US intend to spend up to 30% of global marketing budget in the space. A pop over to McKinsey, predicting this will therefore impact the advertising market revenue by 2030 by a third, a $144 billion to $206 billion.
The spend will be a toe dip into the space through supercharged loyalty programs and extended virtual experiences for the consumer, following in the footsteps of Nike and Starbucks. In a recent digiday interview of marketers, we have more insight into this toe dip intention. Rob Davis from MSL US looks to explore NFTs in a safer and less radical way. Red Wing’s CMO is motivated by ensuring they stay relevant, contemporary and are willing to take some risks.
When you take a bird’s eye view at the changes of the past and look ahead, we as all marketers will create this evolved world together incrementally and by the very nature of more brands doing this, consumers will grow to expect it over time. It happened with social media and now social media is the cornerstone of consumer engagement. But what is it in web3?
For a quick crash course on the meaning of web3 for brands and an example of how it will impact the consumer experience across virtual worlds and ownership, check out my last article that unpacks it here.
In 15 seconds now though, web3 for brands and consumers means a sense of democracy and transparency in the exchange. Sales will go much further for the consumer in terms of value, building community and collective wealth together by giving consumers more skin in the game, more ownership, feeling part of the brand. Along with creating connected experiences in real life and in virtual worlds, beyond the product and the brand itself, and creating an extended, more immersed social experience with other brands, spaces and shared-experiences. When you think of web3, think community, collective wealth and transparency, that can be used by the consumer wherever they go.
Early examples of brands who have experimented with this include Starbucks Odyssey and Nike, who closed 2023 stating their commitment to building the future of Nike with the consumer being part of that creation by launching their web3 marketplace swoosh.nike with a view to ensure consumers are part of this future phase. In 2023, Nike will start to experiment with digital product sales and things like IRL token-gated events or virtual activities. They reported to have made $185 million+ in revenue in the space among other leading fashion brands financially following suit. Because of this, brands will use Nike as the north star to follow.
Image source: Dune.com
As a futurist at the helm leading Dialect’s strategic services, working with brands and web3 businesses, it is advisable for brands to spend this budget managing first mover advantage, and the safety of both the brand and customer. Use 2023 by designing supercharged loyalty programs and a first experience in virtual words with both a short and long term plan, that can evolve as the market does. Look at partnerships that go beyond the product for consumers. Spanning the ability to earn digital goods for virtual words, entertainment in virtual words connected to real life experiences and growing loyalty. Instead of experiments, be purposeful and integrated.
2. Web3 hiring. A rise in Web3 marketing roles in house
New roles are being created in house within corporate brands on the rise for Chief Metaverse Officer, Metaverse marketing leads, Web3 Community Manager. Disney, Proctor and Gamble (P&G), LVMH, Creative Artists Agency (CAA), Telefonica SA, and Crate & Barrel are among the major companies that have recently invested in a CMO, according to a Bloomberg report. And we are seeing varying levels of marketing, community, and creative roles increasingly being advertised on LinkedIn, indeed.com and other recruitment sites.
Web3 companies across blockchain, cryptocurrencies and SaaS providers that connect brands into web3 eco-system through APIs and support services are posting open job roles for the marketing function to bring the expertise of how to reach brands and audiences in-house too.
We’ll see these first recruits on the corporate brand side begin to build the marketing models of web3 into their brand planning models, marketing funnels and define how to measure success of any activations and overall integrated programs and as a result, continue to grow focus year on year and budget will increase the more engagement and growth is measured connected to the web3 activities.
3. Metaverse brand open source standards: Road to the open metaverse kicked off at CES in January 2022
The main criticism of metaverse and web3 in 2023 from the brand side is the amount of work it will take to realise the vision of interoperability. The transferability of owned assets across the virtual world and experiences and therefore the ability to technically connect to different platforms. This will require partnerships, and cooperation among brands, technology companies, and any business really. While this vision will take time, we will see 2023 be the year where this topic will be at the forefront of the industry conversation, and the first steps will be taken by the leaders in space by launching the early partnerships that were being worked through in 2022.
The metaverse standards forum unveiled their plans at CES last week for the “Road to the open metaverse”. They discussed how the industry is moving forward with protocols for brands and builders to advance an interoperable web3. Their vision centres on: “Achieving a metaverse for all, an open and inclusive metaverse, which will require unprecedented cooperation”.
But what does this mean? Milestones and outcomes shared throughout the year within the core working groups they have up and running that span asset interoperability, asset management, avatars, real work integration, security. You can check out all with their current known working groups and overviews here.
4. Gaming platform evolution
This is in my opinion the hottest topic of all. The moves that gaming platforms have and will continue to make to expand and welcome in brands and businesses, the creator industry, the advertising industry, and establishing spaces and tools for new industries within the virtual worlds to emerge. Gaming will evolve to be beyond games as a standard experience. Gamers (who also drink water, coffee, sodas, have their favourite foods, and favourite brands just like us all) virtually step into Roblox for example to either talk to, or play with friends after work. To play a game a friend created, and then decide to go to a show that another friend of theirs has created, or to an event as a result of a loyalty program. Here are a couple of highlights:
Roblox throughout 2022 took steps towards building a new era. To create more sophisticated experiences and visuals, and expansion into new features such as interactive billboards and portals to go into other experiences. Expansion into more user generated content creation features and speeding up the process to both learn how to create on the platform and create.
Epic Games, creator of Fortnight, used their recent $30million investment to invest in Hadean to scale up and expand the possibilities for creators and developers beyond 100 person game. Epic’s VP of Unreal Engine Ecosystem, Marc Petit, was interviewed by Forbes on the investment:
“Hadean’s computing power will provide the infrastructure that’s needed as we work to create a scalable metaverse. The company’s technology complements Epic’s Unreal Engine by enabling massive amounts of concurrent users and unlocking new tools for creators and developers. We are pleased to contribute to Hadean’s growth and look forward to continuing to work together to lay the foundation for the metaverse.”
— Marc Petit, Epic’s VP of Unreal Engine Ecosystem
5. Strategic partnership growth
This one is a quick one. In this year of experimentation of integration, and interoperability, the first movers are looking for partners, and web3 gaming companies are searching for brands. Conversations are happening behind the scenes and we’ll see more of the programmes connect with complimentary services. Consider creating a list of complementary products and services your audience would benefit from and explore what the partnerships would look like in co-creating experiences across web3 and virtual worlds.
A final word from me
The new world will be created by creators and we are all creators in our own way. If you’re a brand intending to spend your marketing budget this year into web3, don’t wait until it’s too late. Test and iterate as you go.don’t do it alone. Partner with people who understand the space and with the web3 technologies that already exist.
When you design for the virtual world, it is fundamental to understand the audience there and meet them in their mindset. Virtual spaces are sacred and community centred on a very different level to say, social media community. Entering this space is a careful operation to join, maintain and grow in the areas most important to that space.
As you take the first steps, focus on the principles behind the buzzwords: community, value, experience and collective wealth for your customers, you’ll be at the forefront of the evolution. Integrating this into your existing brand ecosystem with and without web3 is a way to balance brand safety and bravery as you dip your toe in the web3 water.
Any questions? Get in touch with Haifa.
We’d love to hear from you and here’s a web3 strategy kickstarter guide you can download now to help you take your next step.
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