The CX advances on the horizon with Web 3

Web 3 is dominating conversations at present in the CX arena and for good reason. The next iteration of the internet is promising everything from decentralized data to virtual sneakers.

In theory, Web 3 will give the power back to consumers when it comes to data and security, allowing peer-to-peer (P2P) interactions and facilitating more user interactions. While Web 2 was about participation and collaboration, the essence of Web 3 comprises co-creation and ownership. Whether or not the hype is entirely justified, nobody yet knows, but it is certainly building.

To get the lowdown on how this is all likely to change the customers’ experience, CX Network caught up with board member Gautaam Borah. He is the former VP and head of customer service operations at Vodafone Idea, author of the book Monetising Innovation and director of e-commerce and Web 3-related start-ups.

“Web 3 is based on decentralization and emerging technologies like blockchain and it is about shifting the focus to collaboration and ownership of digital assets,” Borah explains.

“It is important for organizations to understand how they can shift from legacy technologies toward technologies comprising Web 3 components.”

Borah explains how any conversation about Web 3 reminds him of the tweet from Elon Musk, "Has anyone seen Web 3? I can't find it.", which saw former Twitter CEO Jack Dorsey reply, "It is somewhere between A to Z.".

Putting aside such billionaire banter and the unknowns of future technology, Borah sees multiple ways Web 3 will facilitate customer autonomy and bring a new wow factor to CX.

The disruptors

Decentralization, machine learning and augmented and virtual reality (AR, VR) are the building blocks of Web 3 and Borah’s outlook touches industries old and new.

In finance, emerging decentralized finance technology – otherwise known as DeFi tech – is based on distributed ledgers and therefore will enable consumers to take charge of their own money without the intervention of a traditional banking system. That means brokerages, exchanges and banks will be swapped out for smart contracts based on blockchain.

Explaining the impact on e-commerce he says: “The current model of aggregation will be replaced by sellers directly reaching buyers using open platforms and buyers will be able to locate the sellers based on defined reputation across networks.”

Gaming and virtual brand interactions will be enhanced with immersive, metaverse-based experiences and NFTs are likely to be making headlines for many more years to come.

Borah adds: “NFTs are the best example of Web 3 gaming where you can really own any type of digital assets. This is a feature that was never seen in Web 2 environments.”

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New-age CX

The bottom-line impact of these innovations is that customers will have digital identities in the form of crypto tokens or Self Sovereign Identity (SSI). This will enable them to use any platform based on this identity rather than rules set by the platform, which puts CX on track for significant transformation.

Borah says: “This use of smart contracts, ownership and co-creation will shift the balance of power to the consumers. They will decide who contacts them, in what way and for what product. The experience is bound to rise to a much higher level.”

It means collaborative complaint resolution could replace the current complaint resolution process.

“This could happen with a collaborative problem resolving system aided by efficient data as well as artificial intelligence (AI) and machine learning (ML),” Borah explains.

One thing that will not change, however, is that much like Web 2 data remains the primary building block of Web 3 even though ownership will shift toward customers.

Borah says: “Customer data will be decentralized and data will be owned by customers. This means they will be able to decide how and where the data will be used, and this will impact data collection and usage strategies across enterprises.”

It will also impact personalization, which is already in store to see significant changes as cookies are rolled back.

“There will be high degree of personalization as data will be more organized. The integrated use of AI and ML will create a smart system which will address any customer requirement effectively and in a much faster way,” Borah continues.

First movers

In December 2021 Nike acquired RTKFT, a Web 3-ready company which leverages game engines, NFTs, blockchain authentication and augmented reality to create one-of-a-kind virtual products and experiences. In May of 2022, Nike’s CryptoKicks launched, a new virtual sneaker collection for the metaverse enabled by this acquisition.

“In a Web 3 metaverse, the user can wear the virtual sneaker in any of the platforms,” says Borah and it will not stop there. There will be virtual stores and commerce experiences as well as AR/VR enhancements for brick-and-mortar commerce.

By way of example, Borah says: “Imagine a person who intends to buy a bike for an expedition across terrains full of mountain and valleys. They visit a virtual shopping district in a metaverse. With their digital identity they can roam across various metaverses, select few bikes, fit accessories and test the bikes in all the terrains in the metaverses they plan to visit. The person can then decide on a particular bike based on this experience which replicates exactly the way it is in the physical world.”

Web 3 and the employee experience

Borah says the technology and business models emerging from Web 3 are “at the nascent stage of an S-Curve – this means, many models will emerge before the industry and technology settles on a dominant design”.

This will prompt brands to realign marketing strategies and rethink customer journeys rather than simply integrating or replacing the legacy technologies with emerging technologies predicated on Web 3 principles.

Workforce skills must also transform.

He says: “Web 3 is equally a cultural evolution as much as a technology shift. With the balance of power swinging towards consumers, there will be a massive flip required for the workforce both from the perspectives of skills and mind-set.

“Enterprises should start working on a construct for employees that takes care of both these requirements,” he adds.

Long before Web 3 was even talked about Digital Darwinism claimed several high-profile victims from Blockbuster to Polaroid. The threat of extinction will loom ever larger for those who do not make preparations to ride the Web 3 tidal wave that is coming.

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