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Harnessing customer engagement and loyalty with web3
Web3 is revolutionizing how we interact with the internet. Based on blockchain technology, it promises to be more decentralized, secure, and user-owned than the current web. In the business sphere, web3 is creating new and engaging ways for businesses to interact with customers and drive sales through innovative experiences.
According to PwC's 2023 Consumer Insights report, over 40% of consumers surveyed in December 2022 said they planned to increase their online shopping in the next six months, a significant uptick in the market. Many brands, however, are missing the opportunity to capture this growth by providing a superior e-commerce customer experience. While 61% of executives say their customers are now more loyal than before the pandemic, only 20% of consumers agreed.
To stay ahead, businesses must ensure that customers have a cutting-edge e-commerce experience and that their expectations are being fulfilled.
Does Web3 hold the answer?
The future of e-commerce for Gen Z
E-commerce has been growing for years, but web3 is poised to revolutionize the industry by giving consumers more ownership and control over their digital experiences. A growing number of consumers are already using web3 technologies, and those that don't offer modern digital experiences may lose out, especially among Gen Z customers.
"Everyone wants to attract a younger audience," John Rolston, customer transformation and loyalty partner at PwC US, said. "It's as simple as creating interactions with your brand based on their preferred channels, wants, and needs. Web3 becomes a foray into new forms of engagement."
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In the metaverse, brands can create experiences such as virtual stores or games. Web3 can also be used to create more personalized loyalty programs that reward customers for engaging with the brand. "It's a great way of tapping into the experiences in the web3 world where that Gen Z audience is engaging today and the assets that they're exchanging," Rolston said.
One brand using web3 to amplify their brand is Chipotle. The Mexican food chain is using web3 to create new and engaging experiences for customers, particularly the Gen Z demographic, and continuing to revolutionize its loyalty program. Recently, Chipotle unveiled an online game called "Buy The Dip" to give away $200,000 in cryptocurrency. The company also created experiences inside Roblox, including a virtual store where people could roll a virtual burrito and get one in real life.
Web3 technologies, like extended reality and crypto, allow Chipotle to offer more rewarding and innovative loyalty programs. This is the evolution of Chipotle's previous customer engagement efforts: Its loyalty program, which first launched in 2019, saw a 99% increase in digital sales and a 13.2% increase in revenue to $1.4 billion within 18 months.
Answering the question of what customers really want
The biggest challenge of web3 is the user experience, which can still be clunky and complicated. "We're still in that phase of understanding what consumers really want and how to deliver that to them," said Matthew Blumenfeld, digital assets and web3 strategy leader, PwC US.
The current bear market in crypto and web3 has been a good thing for customer experiences. When the market is down, developers are forced to focus on building products and services that solve real problems. As a result, we are starting to see the release of new and improved web3 products and services that offer better customer experiences.
Another challenge is reputation. The crypto and NFT space is plagued by bad actors, which has given the space a bad name. This makes large companies hesitant to get involved in web3. "It's a small number of bad actors," Blumenfeld said. "Unfortunately, that's what tends to get picked up, and it gives pause to enterprises."
Consumers aren't necessarily put off, however. In the PwC US Customer Loyalty Survey 2022, 82% of consumers said they were willing to share some type of personal data in exchange for more personalized service. So in a web3 environment, you could use a token to allow access to your online shopping data in exchange for a benefit or an improved loyalty point earning rate.
Winning over the next generation of consumers
With so many different ways to approach these emerging technologies, it's important to know where to drive value while leveraging the right web3 technology to deliver on those outcomes. "Customers are already expecting more from the brands they interact with," said Katie Forrest, a customer experience strategist and designer at PwC. "If organizations don't have a clear strategy on how they will deliver in a web3 world, they risk losing the next generation of consumers."
Web3 creates new and engaging ways for businesses to interact with their customers and drive sales through different experiences, Forrest said. "With these new experiences, every touchpoint will mean more, and experience design will be more important than ever to ensure success. You need to know your audience, how they will change over time, and what they are looking for from brands they interact with."
Web3 will transform the way businesses interact with customers. It's a promising new technology that has the potential to revolutionize the way businesses interact with customers. Crucially, web3 isn't a "nice-to-have": It's something all businesses need to adopt to thrive in the future.
To learn more about how PwC is creating value for enterprises and society in the metaverse and beyond, please visit www.pwc.com/metaverse.
This post was created by Insider Studios with PwC.
This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.