The following is a guest post from Oleg Fomenko, the CEO of Sweatcoin.
In the rapidly evolving technology landscape, where innovation is standard and breakthroughs are expected, amid the hustle and bustle and excitement, one fundamental principle is often overlooked: understanding the consumer.
Technology companies ranging from Silicon Valley giants to Web3 startups are often keen on creating new technology, often at the expense of their users. Web3 companies in particular are already at a disadvantage before they even get off the ground.
Overlooking consumer needs isn’t just a minor misstep; it is a critical error that determines the success or failure of a product, service or application. This is a problem we see en masse in the Web2 world, with companies like Reddit and Twitter squandering the dedication of the user base in favor of misguided “innovation.”
Reddit, which describes itself as “a network of communities where people can explore their interests, hobbies, and passions,” recently came under fire for removing third-party applications. For years, users have used various applications with different features and user experiences to access their favorite community forums. Applications such as Apollo were very popular due to its slick user interface and customizable features.
When Reddit announced earlier this year that it would ban such applications, users and thousands of subreddits were outraged became dark and stopped using their forums to protest the decision of Reddit leadership. The leadership stood by their unpopular choice and effectively banned all third-party applications, causing a huge uproar in the community and causing the platform to receive a lot of self-inflicted heat.
The case of Twitter is even more dramatic and the implications more widespread. Elon Musk’s very public, $44 billion acquisition of one of the most popular social networking sites in the world caused a huge drama for cultural, political and economic reasons. Caught in the crossfire of Musk’s vision for one everything appthe US government’s desire for editorial influence and Musk’s investors’ desire for profitability are the platform’s users.
Despite the new name not catching on, Twitter, which is now technically called ‘X’, is going through an identity crisis. The changes are aesthetic in nature and have serious consequences for the way people interact with the site. Paid subscriptions for verification have replaced Twitter’s traditionally opaque appeals process.
Publishers can offer paid subscriptions for exclusive content, but X receives a 10% discount. If users don’t pay for verification, their ability to use the app is limited. Verified users can do that read until 10,000 tweets per day, while unverified users can read 1,000 per day, and new unverified users can only read 500. These changes are significant and all come after a total overhaul of the business, including 80% of the workforce is being laid off.
Both Twitter and Reddit are flagship applications in the global social networking industry. Despite their enormous popularity, they have still managed to dramatically alienate and enrage their users by trying to fix something that wasn’t necessarily broken, ignoring their actual users and customers.
Web3 has a similar problem, although they don’t quite have the same user base to get upset about. Because Web3 projects often focus on metrics such as total value locked (TVL), they have become dependent on targeting whales to drive such metrics. But whales do not live and survive in an empty sea.
Web3’s future lies in a thriving ecosystem, powered by easy-to-use, easily accessible products that allow users to flow into the ecosystem more naturally. Where we see projects targeting Web3 natives, even the onboarding is often complex and requires knowledge and familiarity far beyond what is required for mass-adopted use cases in Web2.
Web3 will become a much more vibrant place when users can seamlessly work with apps and projects without even realizing they’ve gone on-chain. Placing a key focus on active usership with appropriate products and use cases, seamless staging and a user experience to match will drive these massive active users.
Most Web3 applications have wildly clunky user experiences and far too long and complex onboarding processes to even get there. These new-age applications are being adopted at a slow pace because no startup has cracked the code that ensures smooth onboarding, ease of use, and a useful and engaging application.
Web2 set an extremely high standard for the way people interact with consumer technology, which Web3 is still working towards. Despite all the benefits of Web3, including decentralized ownership, and various economic incentives, the tangible ability to access these benefits has not yet been realized. It is clear that the innovative benefits to users that Web3 applications provide are enormous, and it seems inevitable that this movement will take off once some of these pressing challenges to their adoption are resolved.
As founders and technologists work to develop these new products, they must consider and learn from the successes and failures of the Web revolution that came before it.