Technological advances are really only effective if they improve on experiences or create an entirely new kind of experience that manages to break through the inertia barrier and reach broad adoption. Does it do something that I can’t currently do? Does it do something novel or better? Will it create new opportunities and markets?
With Web3 — the next generation of the internet — we are still in the midst of answering those questions. For those who might think the current version of the internet (Web2) checks all the boxes, there are others like Adam Caplan, Salesforce’s SVP of Emerging Technology, who think that the next chapter of the internet is less about links and clicks as it is “about building community and creating personalized digital experiences in this Web3 world.”
In this interview, Caplan gets into the nitty-gritty of Web3 technology — or more specifically NFTs — as well as what the company is doing to help brands deploy and manage Web3 campaigns in a sustainable and trusted way.
Q. For those unfamiliar, can you give a quick explainer about this space? What’s Web3? And what’s an NFT?
While still in its early years, the mission behind Web3 is to create a decentralized web that creates new types of ownership, new ways of building trust and collaboration, and offers exciting new opportunities for brands to engage with customers.
NFTs and Crypto live in Web3, which is the next generation of the internet built on blockchain. It allows people to read, write, and own their data and digital identity. And, it’s a decentralized network, meaning there is no centralized control point. Everyone in the network has the exact same copy of the data in the form of a distributed ledger. If someone’s ledger is altered or corrupted in any way, the majority of the people in the network will reject it.
Crypto – Bitcoin, Ethereum, Dogecoin, etc. – are ‘fungible tokens.’ ‘Fungible’ basically means they’re all the same, they’re not unique, and one can be swapped for another.
Non-fungible tokens – NFTs – are unique. They have unique properties and different rarity levels.
Non-fungible tokens – NFTs – are unique. They have unique properties and different rarity levels. They give their owners an opportunity to harness the IP to create value and a sense of community in terms of ownership. As an example, if I buy an NFT of a digital shoe, I can exclusively use it on my avatar in a virtual world. I also can get access to an exclusive new community of sneaker enthusiasts.
Each time an asset, like my digital shoe, is purchased or transferred, a ‘stamp,’ much like a physical stamp, is added to the blockchain. Think of blockchain as a ledger that stores information, like purchases, in a digital format. Blockchain helps verify every step of the NFT purchase, from being stamped as owned by one person, to being sold, transferred, traded, and so on. It also helps verify ownership so holders know their NFT is authentic and unique.
Q. So why is Salesforce getting into Web3, and why now?
We’ve seen a lot of interest from customers who want to understand and tap into this new world of Web3 and NFTs. Unique digital assets like NFTs present new avenues for brands to tap into first-party data to build digital communities, create digital twins, and drive loyalty programs.
Unique digital assets like NFTs present new avenues for brands to tap into first-party data to build digital communities, create digital twins, and drive loyalty programs.
A sports team, for example, can offer NFTs that accompany a loyal customer’s ticket, and the NFT unlocks early access to exclusive brand experiences. In this case, NFTs help drive loyalty with a brand’s super-community.
Brands can also leverage an NFT within a digital experience, which is really popular among clothing and fashion brands. There’s a pretty amazing amount of clothing changes that are made to people’s avatars in the metaverse — it happens daily, if not more. We see this in gaming too. So, we’re seeing a lot of excitement about this use case, and with rewards delivered in the real world, such as exclusive, in-store opportunities or discounts.
Q. What’s it like entering such a new space?
We knew that this emerging space had risks. We partnered with our Office of Ethical and Humane Use and Sustainability teams to make an easy-to-use technology that enables organizations to ‘mint’ (create, in NFT-speak), manage, and sell non-fungible tokens (NFTs) in a trusted, sustainable, and easily managed way, the same way they sell their physical products on the Salesforce platform but with an additional layer of trust and safety built in.
We’re creating a safe place with an amazing user experience where customers don’t have to understand the really complicated aspects of blockchain, like smart contracts. We also built industry-leading security and trust features into our Web3 product to protect the brands, as well as their end customers. This allows them to enter the Web3 and NFT space in a safe way, and buy directly from their trusted brand’s website as opposed to third-party marketplaces.
Q. In its simplest form, how does Salesforce Web3 work?
We make it very easy for Salesforce administrators to set up and implement an NFT offering through NFT Management. It uses drag and drop tools, which dramatically cuts down on traditionally lengthy development cycles. It’s all customizable and built to make the process simple and seamless – from setting up an NFT collection to selecting the most eco-friendly blockchain.
And, with our new Web3 Connect API integration, brands can sell or give away NFTs, and all that data comes back into Customer 360 to link customer activity across Web2 and Web3 — with consent from customers, of course – giving organizations a holistic view of each customer across both physical and digital environments. All of this enables brands to build deeper connections with their customers, and drives more value for their NFT holders.
Q. This product actually launched in a pilot last year to help ensure it was rolling out safely and ethically. What did Salesforce learn from the Web3 pilot phase?
At Salesforce, trust is our number one value. With Web3, we wanted to make sure we were building a product that people could trust. We want to protect a customer’s brand, and they want to protect their end customer.
To make sure these guiding principles were met, we consulted with experts inside and outside the company before launching a customer pilot. After more than 275,000 successful transactions in the pilot, we learned customers primarily see NFTs as a way to modernize loyalty programs and connect with new audiences in Web3.
One of these customers was Scotch & Soda, a fashion retailer, who came to us wanting to increase brand awareness and community engagement while building brand loyalty using Web3 and NFTs. With the help of Salesforce partner AE Studio, we were able to bring their vision to life by using Salesforce Web3 to create and securely deploy their Club Soda 3.0 NFT pilot program in less than two weeks.
This gave Scotch & Soda real-time insight into the 30% net new customers they were able to reach and powered more personalized marketing campaigns with unified data from across Web2 and Web3.
This gave Scotch & Soda real-time insight into the 30% net new customers they were able to reach and powered more personalized marketing campaigns with unified data from across Web2 and Web3.
Q. How should brands think about incorporating NFTs into their strategies?
If Web1 was about democratized access to information, and Web2 was about facilitating transactions and bi-directional communication, Web3 is about enabling more personalized digital experiences. The Web3 era has the power to change how we participate on the internet by enabling people to read, write, and own their data and digital identity. NFTs are one part of an individual’s digital identity.
Brands should be intentional in incorporating NFTs in the right way. They should be able to answer questions like: What is the roadmap we’re going to deliver to NFT holders? How do we manage our communities? What does the artwork communicate or inspire and how do we support the creator community? What royalty should we reward artists with to make sure this is fair and equitable? How do we think about sustainable chains? Do we want to engage in co-creation with our communities?
Q. NFTs have raised some sustainability concerns about the energy needed to mine them. How is Salesforce addressing that in its product?
Another of Salesforce’s core values is sustainability, so that was an incredibly important consideration in our development process. We’ve partnered closely with our Sustainability Team, Ethical Use Advisory Council, external experts from academia and non-governmental organizations, and employees to ensure our strategy was progressive — to lead, and to really push the industry in the right direction when it comes to sustainability.
We’ve made a conscious decision that Salesforce will not support proof-of-work chains and will instead only support proof-of-stake chains, which result in 99% fewer carbon emissions. When brands create the rules and parameters for purchasing in Salesforce Web3, they have the option to select their blockchain based on their preferences, from a list of proof-of-stake chains.
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