New Customer Experience promised by Web 3.0

Thu 28 Sep 2023

The emergence of Web3 paves the way for a new form of digital customer relationship, blending the real and the virtual, while addressing the needs for anonymization, control over personal data, belonging, and value sharing. It's not just a technological evolution but a philosophy where control is returned to the user, and engagement is rewarded, thereby restoring value to interactions.

Prouhet Loraine, Senior Innovation & Digital Consultant

The NFT Drop

Beyond telcos, some brands are already establishing themselves as NFT pioneers and presenting the first tangible use cases in the market.

Yves Saint Laurent Beauté took part in this venture in June 2022 by organizing an NFT drop called "YSL Beauty Golden Blocks." These NFTs were downloadable through a mobile app specifically developed by Arianee for this purpose, functioning as a blockchain-based Ethereum wallet. By holding these NFTs, customers gained access to exclusive experiences with the brand, including concert tickets and early product releases. In January 2023, a timely event promoted Black Opium perfume and further accentuated the experience by encouraging the enthusiast audience — those who had purchased the perfume bottles — to create their digital wallets and acquire new NFTs, offering additional advantages such as promotions, exclusive content creation, and private sales. Through these activities, Yves Saint Laurent Beauté is exploring the potential of Web3 and expanding its community without transitioning to the metaverse. The brand excels at delivering a distinct and innovative customer experience while rewarding customer engagement.

Similarly, for sporting goods retailer Decathlon, the use of NFTs has also become immersive. The company sought to convert a physical object to an NFT, allowing for interactivity with the virtual world and access to various experiences. In April 2022, the brand collaborated with Séan Garnier to launch "Les Barrio," a model of sports shoes connected to an NFT. By connecting their NFT, customers could virtually engage in playful experiences like exploring a virtual locker room, participating in live videos with the world champion or joining Decathlon's co-design room to contribute to future product creation. Through such exoploration of Web3 and immersiveness, the brand continues to facilitate communication with customers by virtually placing them in a more "real" dimension. It also fosters communities around the brand by providing simultaneous access to these spaces during the same period for NFT holders.

On the telco side, brands must move beyond merely being retailers in the metaverse. By stimulating senses beyond sight and sound, immersiveness enhances customer engagement and closeness. In order to benefit, telcos must seize these potential opportunities, starting today.

By utilizing a simple virtual store, these brands can leverage a familiar customer-relationship channel and easily invite their customers to explore virtual possibilities together. These immersive experiences can take various forms, blending both the real and virtual worlds. They may include entertaining games, strategic quests (requiring collaborative efforts from players), or immersive exhibitions that showcase a telco operator's industry concentration, from installing underwater cable to providing Wi-Fi within households.

Today, in order to maximize the potential of these experiences, interactions should also involve the distribution of NFTs. This fully allows companies to strengthen brand preference and foster connections among their customers. By bringing together a collection of players, visitors and customers around the brand, telcos can create governed communities driven by common interests, whether intellectual, social or recreational. Such communities can encompass a system of rewards or compensation. In Web3, these communities are known as DAOs (Decentralized Autonomous Organizations). They play a crucial role for brands, mirroring the strength of real-world communities while generating value for the brands themselves. Customers who are engaged within a DAO built around a telco brand can become ambassadors, promoting the brand, interacting with additional potential customers, assisting others and receiving compensation for their contributions to supporting the brand.

The Digital Wallet: The Key to Accessing Web3 Opportunities

NFTs can also provide solutions to the challenges of zero-party data, which refers to the data that customers willingly and proactively share with a brand. This data offers the advantages of being qualitative, relevant, cost-effective and compliant with regulations.

When customers download an NFT to their digital wallet, they agree to share the public address of their wallet voluntarily. This action empowers the brand to activate various customer relationship strategies without requiring the customer's personal data.

Additionally, a digital wallet allows users to store a variety of digital assets, including NFTs, personal data, promotional coupons, event tickets, loyalty points and cryptocurrencies. Users orchestrate their own permissions, enabling brands to access different data stored in the wallet in exchange for valuable offerings, such as fully personalized experiences.

Arianee positions itself as the leading Web3 support solution for brands. The startup places the digital wallet at the core of its experiences, serving as the gateway to real and virtual experiences through contained NFTs, ensuring seamless continuity across different domains.

Leader Price has joined forces with Arianee and The Sandbox to launch the Club Leader Price. Grocery store customers receive an NFT via a QR Code delivered by email, featuring playful characters like bakers, delivery persons, pastry chefs, winemakers, etc. By activating the QR Code, the brand encourages customers to connect to the Leader Price Wallet app — one developed by Arianee — to access the NFT. These NFTs unlock promotions tailored to each individual's profile, such as discounts on deliveries for delivery personnel. To prevent random profile allocation and resulting customer frustration, NFTs can be exchanged between holders, allowing for better customization to their needs and generating a wealth of valuable information for the brand.

A New Form of Usage-Based Marketing

These use cases for NFTs and digital wallets highlight the emergence of a new form of customer relationship marketing. This approach is no longer centered on the person themselves but on their use and behavior through the voluntary sharing of centralized information on the wallet.

With Web3, this voluntary sharing of data will be instrumental in creating value for the brand. Telco operators therefore have every interest in exploring current data-sharing incentives. These can be an extension of current models with hyper customization, such as an offering «at the right price» based on the customer’s actual consumption or advantageous cross-sell offers based on partnerships identified through the sharing of a set of transactional or navigational data. For example, a telco operator can team up with different partners (cinemas, SVOD platforms, digital kiosks, amusement parks, hotels or tourism agencies, etc.). By receiving transactional or navigational data from a customer, the operator can identify a cross-sell offer relevant to the customer and offer them an activation «at the right price» as a reward for data sharing. The brand is thus a business provider and actor in a global (multi-brand) and interoperable customer experience.

Telco operators can also rely on the current state of the climate emergency to strengthen interest in data sharing, including equipment consumption. The customer can thus register as a player in the creation of a second-hand market dedicated to the sharing of unused internet data, transferring it to people in need. Sharing can be motivated by the distribution of NFTs “green actors” or by their integration into DAO “digital inclusion” intended to support populations in need via digital.

Another notable use case for the sharing of customer data is through the use of digital twins. A digital twin is a digital representation of a property —  a box, for example. In exchange for sharing analytical data related to their boxes (navigational, transactional, energy, etc.), customers can power a digital twin and benefit from increased monitoring of the performance of their equipment to prevent bugs and anticipate the necessary evolution or intervention of technicians at home.

Web3 encourages the development of these new business models thanks to the blockchain and the transparency it brings to information processing. Customers have more control over their data but also more visibility over their operations. Brands must now fit into this new paradigm, encourage the transfer of data and offer a clear vision of the use that will be made of it.

Loyalty Programs Are Exported in Web3

Some brands have already incorporated the conceptual changes inherent in Web3 and taken the exploration a step further by offering loyalty programs based on NFTs. This is the case for Starbucks, which is in the process of creating an extension to its Starbucks Rewards program with Starbucks Odyssey. The brand offers a new digital space where its community can gather around a coffee and engage in immersive experiences.

Starbucks Odyssey keeps the promise of being easily accessible via an app while relying on Web3 technologies (Polygon blockchain). Customers can enjoy fun activities such as games, contests, information, etc. by gaining access to collections of NFTs. These NFTs are available for purchase, are exchangeable and promise exclusive benefits and experiences like espresso martini-making classes or a trip to Costa Rica to discover the Starbucks Hacienda Alsacia coffee farm. The program is currently in its beta version, but the first NFTs have already garnered interest and value by posting a floor price of $350 just a few minutes after launch. There is little doubt that this rewarding customer loyalty program will strengthen the engagement of its community.

Such a program can generate strong interest among telcos. The sector is facing a standardization of its products and services and must thereby offer strong distinction. Building a loyalty program based on the blockchain and generating NFTs and associated levels and rewards would deepen long-term customer relationships and encourage expansive customer engagement. The loyalty program is all the more interesting because it takes the different aspects of Web3 — blockchain, NFTs, tokens, DAO, zero-party data and immersion — and makes them real.

This is an exciting opportunity for telcos to offer a cross-program with partners and capitalize on the potential of Web3, becoming a key initiator of a more global customer experience.

In a Nutshell

Ultimately, Web3 introduces a new form of digital customer relationship — one that is unique and mixes the real and the virtual. Importantly, it responds to the need for the anonymization of customers and control over their personal data, along with a sense of belonging, value sharing and emersion… It is necessary to effectively manage and democratize this new environment and to engage customers by offering them, along with the aforementioned advantages, a community space that is engaging and open to feedback. Such responses will ultimately be among the best ways for brands to understand their customers and improve their experience without using third-party cookies.

Web3 is not only a decentralized architecture but also a philosophy where the control of personal data is returned to the user, with the user rewarded, thus restoring essential value to interactions. This is not just a technological evolution or a change in customer usage, but the synergy of these two factors. Nevertheless, issues surrounding digital inclusion are still present, and proactive support for users in this context will remain necessary. The development of the Web3 may also be hampered by environmental costs, as the bandwidth required to operate the blockchain remains considerable and exacerbates the carbon footprint.

Currently, a multitude of Web3 projects are underway, but exploration will certainly not be only on the brand and user sides; states and regulators will also have to intervene to clean up the potential and frame the use of this digital evolution. Psycho-social risks may exist, and it is important to best protect the various stakeholders from the risks of identity theft, anonymization of avatars, harassment, etc.

Loraine Prouhet

Senior Innovation & Digital consultant