Based on the shortcomings of “Marketing 4.0” mentioned last week, a new concept of “Marketing 5.0” is needed to solve them. Therefore, Marketing 5.0 needs to solve the problems of stagnation and non-growth of enterprises that cannot be solved by existing marketing theories.

There are several common challenges faced by enterprises such as the fierce competition in new market environments, the users’ traffic proportion being occupied, the increasing of CPA (Customer Acquisition Cost), and the loss of existing customers as follows. 

Due to the lack of product innovation and differentiated development among enterprises, the competition between enterprises becomes a more face-to-face competition of the same or similar products. In the past, companies competed with each other on the shelves of the mall; now companies compete with each other on the high street next to stores, or with similar products displayed online.

Enterprises hope to rely on the support of external large-traffic platforms to promote new acquisitions, but they find that this huge traffic has been occupied by technology giant companies such as Facebook, Amazon, Google, Twitter, etc. Or, in China BAT (Baidu, Ali, Tencent) that known as three super Internet companies, and group-buying websites (Meituan, etc.) occupied those traffic in the past few years.

In one or two years, the preference has gradually shifted towards short video sites such as Douyin or TikTok and personalized news content media such as Toutiao. This trend is like the majority of traffic being occupied by a few platforms. For the vast majority of companies, how to get some traffic from them, such as joining the Douyin platform or obtaining traffic through other more innovative methods, has become a huge challenge for corporate marketers.

The cost of acquiring customers has increased significantly, in this oligopoly situation, traffic holders have the absolute right to speak, and companies must pay a higher price if they want to get support, which leads to a sharp increase in customer acquisition costs.

Serious loss of customers, likewise, the relationship between customers and enterprises is a simple buyer-seller relationship. Customers’ information sources expand, and the choice of goods that can be considered also expands. Customers naturally become low-price chasers, so the situation of customer loss is of course more serious.

If these problems are not resolved, “high-quality new customers cannot come in, and old customers cannot be retained”, which ultimately prevents the company from achieving effective growth. When communicating with many entrepreneurs, I would remind them to think about what is the key to solving the problem now. Is it to increase customer value and then fission from it, or to attract new products, continue promotions, and fall into a cycle of tug-of-war with rivals? Only by thinking clearly about this problem can entrepreneurs or operators get back on the right track of “doing meaningful things”.

The specific digital proof will be explained in detail in another column I will release in a series next, or you also can do research about it by yourself. Of course, what I have provided or shared here is just some idea or thought that be able to help you to ignite and activate your potential knowledge and skills through your own traits. See you in my next article we will continue to discuss more on what else in Marketing 5.0.