Before the advent of Web3, brands predominantly relied on Web2 platforms, notably social media, as their primary channels for connecting with consumers. Recent statistics underscore this reliance, revealing that a staggering 77 percent of businesses utilize social media as a key tool for reaching and engaging with customers.
However, the landscape of consumer engagement is rapidly evolving, driven by the maturation of cutting-edge technologies such as blockchain and artificial intelligence (AI). Forward-thinking brands are recognizing the potential of these emerging technologies and are increasingly integrating them into their consumer engagement strategies.
The adoption of blockchain technology, for instance, offers brands new avenues for enhancing transparency, traceability, and authenticity throughout the supply chain. By leveraging blockchain, beauty and fashion brands can provide consumers with unprecedented visibility into product origins, manufacturing processes, and sustainability practices. This heightened transparency not only fosters trust and loyalty among consumers but also enables brands to differentiate themselves in an increasingly competitive market.
Web3 technology facilitates the co-creation of beauty products.
Jana Bobosikova, Co-Founder of KIKI World, a community commerce company, emphasized to Cryptonews the transformative potential of new technologies in reshaping the landscape of online consumer engagement. While the internet has traditionally served as a platform for brands to showcase their products, Bobosikova underscored the importance of leveraging emerging technologies to foster active participation among consumers.
“At KIKI, our mission is to empower passionate consumers,” Bobosikova articulated. “We founded the company with a simple yet powerful vision: customers and communities should not only be recognized but also rewarded for their advocacy and participation in the success of the products they champion.”
To realize this vision, Bobosikova elaborated on how KIKI leverages blockchain infrastructure to seamlessly connect its community with products that resonate with their interests. Central to this approach is the “KIKI platform,” a permissionless network that empowers creators, brands, and curious individuals to initiate campaigns that incentivize audience participation.
“Our blockchain infrastructure serves as the backbone of the KIKI platform, facilitating connectivity between diverse communities, products, and interests,” Bobosikova elucidated. “This composable network of data forms the foundation for building novel experiences, forging meaningful connections, and co-creating innovative products.”
In essence, KIKI’s pioneering use of blockchain technology not only enhances consumer engagement but also democratizes the product creation process, empowering communities to actively shape the products and experiences they cherish. Through this collaborative approach, KIKI aims to redefine the relationship between brands and consumers, fostering a dynamic ecosystem where participation is not just encouraged but also rewarded.
Today, we're thrilled to share a staged roll-out of a permissionless community commerce platform and @a16zcrypto and @EsteeLauder Companies as our initial funding round partners.
KIKI sees the internet and the communities it connects as the engine that creates and innovates,… pic.twitter.com/sxXgKUllox
— KIKI World (@kikiworld_) April 9, 2024
To provide context, Bobosikova highlighted recent initiatives undertaken by the KIKI platform, which she referred to as “multiplayer brands.” These are products designed to engage thousands of customers in the collaborative process of shaping future offerings.
“For instance, in May 2023, KIKI initiated a campaign that led to the creation of our inaugural co-developed product, the ‘Pretty Nail Graffiti in Pearl,'” Bobosikova explained. “Since then, we’ve introduced four additional product lines, including the SDK Skin Development Kit and the Play Paint Marker, a 3D Face and Body Paint.”
Bobosikova emphasized that all these products were crafted based on community input and voting mechanisms. Participants are incentivized through “KIKI points,” digital collectibles awarded for their contributions.
Digital collectibles play a pivotal role in KIKI’s ecosystem. Bobosikova elaborated on how KIKI leverages on-chain collectibles and their associated metadata to drive engagement and understand user preferences.
“By consolidating both on-chain and off-chain interaction data, tied to user preferences and intent, our ecosystem can construct comprehensive profiles to inform product development,” she stated. “Our smart contracts facilitate the seamless integration of on-chain intent records into user-friendly experiences, allowing us to harness verifiable on-chain data while maximizing utility for a broader consumer base.”
While this approach may be novel for many brands, KIKI recently announced a successful $7 million funding round, led by a16z crypto and The Estée Lauder Companies’ NIV. Shana Randhava, Senior Vice President at NIV, expressed enthusiasm for KIKI’s customer-centric vision, affirming that “Consumers are at the heart of what we do at The Estée Lauder Companies.” She added, “That’s why we’re excited by the KIKI team’s vision of finding new ways to put the customer first.”
Fashion with NFC capabilities facilitates customer engagement.
Near-field communication (NFC)-enabled fashion is revolutionizing how brands engage with their customers.
According to Cathy Hackl, CEO of Spatial Dynamics, a company specializing in spatial computing and artificial intelligence, NFC-connected fashion provides a direct touchpoint and communication channel for consumers. This sentiment is echoed by Tom Wallace, Founder of CreatedBy, a connected goods ecosystem. Wallace explains that his brand utilizes NFC tags to connect physical goods with their digital “tokenized twins” on blockchain networks, allowing brands to share comprehensive stories and journeys of their products.
These “tokenized twins” serve as digital replicas of physical items, providing transparency regarding sourcing, production, and ethical practices. Wallace emphasizes that blockchain-based authentication and storytelling directly address consumer demands for sustainable sourcing and supply chain transparency, while also fostering ongoing engagement.
One notable case study involves CreatedBy’s collaboration with Wonder Raw, a sustainable apparel brand known for its use of trace-certified organic cotton and vegan inks. By encoding data into NFC tags attached to individual garments, CreatedBy effectively embeds Wonder Raw’s sustainable journey and material validation, providing consumers with unprecedented visibility and assurance.
Wallace elaborated, stating, “The second component involves ongoing interactions between the brand and the garment owner(s), with a series of activations programmed throughout the garment’s lifecycle. This encompasses end-of-life upcycling, transforming the garment into a ‘new’ product while retaining the on-chain data from its original form.”
He emphasized that CreatedBy’s “Tech Layer” encrypts all product information and activations. Wallace highlighted that physical goods can be equipped with NFC tags, which can be activated by any mobile phone. This activation initiates authentication, validation, brand storytelling, and product engagement experiences for consumers.
Is there a likelihood of more brands adopting Web3 technology to engage with consumers?
While platforms such as KIKI and CreatedBy are paving the way for stronger consumer-brand connections through Web3 technology, the road to mainstream adoption may prove to be a gradual journey.
Cathy Hackl highlighted the fact that many brands have opted to hit the pause button on their Web3 initiatives, particularly as they channel their focus towards AI endeavors. “This shift has become particularly evident as brands prioritize their AI efforts,” she remarked.
Tom Wallace emphasized that education stands out as a significant hurdle to widespread adoption. “This has consistently been a challenge for numerous brands venturing into Web3 technology,” he noted. “Moreover, Web3 has somewhat suffered from its own hype, encountering a certain stigma associated with anything crypto-related, despite the resurgence of cryptocurrency in recent times.”
Despite these obstacles, Hackl pointed out that major brands like Louis Vuitton remain steadfast in their commitment to Web3 endeavors. Vogue Business reported that in September of the previous year, Louis Vuitton launched a Discord server aimed at fostering connections with the brand’s online community and NFT holders.
Hackl also suggested that as AI continues to advance, blockchain use cases for tracking provenance are likely to emerge. “As NFC-enabled fashion interfaces with the AI integrated into new devices, we’ll witness the emergence of numerous use cases, serving as early prototypes and examples of items that seamlessly bridge the physical and virtual realms,” she explained.
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