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Marketing 5.0

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Marketing 5.0

Technology for Humanity


15 min read
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Next technology helps marketers design better customer experiences, navigate complexity and thrive amid uncertainty.

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The marketing landscape is shifting, as digitalization goes widespread and next technologies go mainstream, say marketing experts Hermawan Kartajaya, Philip Kotler and Iwan Setiawan. They propose a new strategy – Marketing 5.0, which embraces next technology: artificial intelligence (AI), sensor technology, the internet of things (IoT) and natural language processing (NLP). Human mimicking technologies empower you to better create, communicate, deliver and enhance the value of your customer experience.


  • Today’s marketers must anticipate the needs and desires of five generations.
  • Markets are losing their middle segment.
  • Improve your ethical conduct by investing in the collective good.
  • Your marketing strategy should help your organization achieve digitalization. 
  • Machines and humans have complementary strengths and must collaborate. 
  • Glean actionable insights from your data ecosystem and predict customer behavior.
  • Personalize customer journeys with contextual and augmented marketing.
  • Agile marketing enables teams to stay competitive amid market uncertainty.


Today’s marketers must anticipate the needs and desires of five generations. 

Modern marketers must contend with a historic first. Today, five different generations coexist: boomers, generation X, Y and Z and alpha. In the next 10 years, marketers – steered by leaders from generation X and supported by middle managers from generation Y – must earn generation Z and alpha’s trust to remain competitive.

The youngest generation (alpha) has consumed and engaged with digital content since childhood, and holds significant influence over those with buying power. Connecting with younger generations entails a new marketing strategy – Marketing 5.0 – driven by next technology, which strives to improve people’s lives.

“To serve generation Z and generation alpha – the two most important generations in the next decade – it is not just about the application of technology. Instead, it is about how to use technology to enable human-centric solutions. ”

Target boomers and gen X by understanding their stages of life: 

  • The first two decades of life center around learning, development, exploration and identity construction.
  • The second two decades center around transitioning from learning to work, and often involve risk-taking. 
  • The third stage of life typically involves parenting, contributing to society and mentoring or leading others.
  • The final years often center around social relationships, health and enjoyment of life, while sharing wisdom with younger generations.

Younger generations navigate these life stages at slightly different paces: Gen Y, for example, tends to put off child-rearing until much older, and has less patience for slowly climbing up the corporate hierarchy than older generations. Generation Y, Z and alpha will likely reach mature mind-sets and certain life stages earlier, as they tend to merge the first two stages of life and aim to contribute to society at a younger age than previous generations. Familiarize yourself with generational differences to better understand your customers. 

Markets are losing their middle segment.

As a marketer, you must navigate increased societal polarization, due to widening wealth disparities, when positioning your brand. People now choose between high-end luxury items and affordable, basic offerings, rather than purchasing mid-range items. 

“The divide between people who are barely surviving and people who are thriving amid globalization and digitalization must not be ignored.”

Since the onset of the COVID-19 pandemic, rising economic pressures prompted mid-market customers to switch to discount products. By contrast, those in higher income brackets likely gained wealth during the pandemic, prompting them to invest in more premium products – especially those centering around wellness. Rather than ignore the growing wealth divide, embrace an ethos of sustainability and inclusivity. 

Improve your ethical conduct by investing in the collective good.

Marketing 5.0 guides you toward using technologies for the collective good. Investing in the collective good of society creates new growth opportunities for markets. It attracts customers who align with your human-centric approach and mirrors the values of gen Y and gen Z, who call for corporate activism. Customers today evaluate brands based on their ethical conduct, and many companies respond to this pressure by proactively disclosing their economic, social and environmental impact online. Reflect on the United Nations’ 17 Sustainable Development Goals (SDGs), which center around environmental and humanitarian issues – for example, gender equality and climate action – and find ways to align your brand with those goals. 

Your marketing strategy should help your organization achieve digitalization. 

Nearly five billion people used the internet in 2020. Around a million new users join daily; the world could experience universal internet penetration in a decade. While digitalization does create threats – for example, some human jobs, such as those involving repetitive tasks, will no longer exist and fake news may become more ubiquitous – the internet brings many benefits: the creation of a new digital economy; opportunities for lifelong learning, as AI creates knowledge bases and data ecosystems; smart homes and augmented living using brain/computer interfaces such as Neuralink; life extension and improved wellness, as big data and AI enable breakthroughs in health care; and improved social inclusivity and sustainability – for example, shared vehicles. 

“A digital-ready organization is prepared for what comes next as digital natives take over the markets around the world.”

Marketers must help people overcome their fear of new technologies by focusing on the innovations’ abilities to improve quality of life. For example, you may show customers that AI can help them connect with other people, thus combating the narrative that digitalization will erode social connections. Assess the digital readiness of your customer base and evaluate your organization’s digital capabilities. Gauge which strategy to adopt, from digital transformation to customer migration. Your customer migration strategy, for example, might entail offering instant gratification incentives for those who move to your digital platform, such as discounts.

Machines and humans have complementary strengths and must collaborate. 

Much of next tech – artificial intelligence (AI), sensor technology, the internet of things (IoT) and natural language processing (NLP) – originated a half a century ago or more, yet is only taking off this decade, thanks to six enabling technologies reaching maturity: cloud computing; the internet; open-source software; mobile devices; computing power; and big data. Next tech mimics human capabilities – such as the ability to learn; so, apply it to amplify the scope and impact of your next-generation marketing campaigns. For example, next tech can help marketers detect customer emotions and individually tailor offerings, interactions and content. 

“Businesses need to drop the ‘machines replacing humans mind-set’ or risk missing an opportunity to maximize their operations.”

Customers often make buying decisions by consulting their social networks. Embrace next tech to move your potential customers from mere awareness of your brand to advocating for it to family and friends. Doing so requires carefully designing each of the following touchpoints with human and machine elements: content marketing; sales; advertising; direct marketing; channel, service; and offering. 

The luxury brand Prada, for example, incorporated next tech in its distribution channel by replacing its retail experience with a virtual reality (VR) experience during the COVID-19 pandemic. Humans and machines have different strengths: Computers excel at convergent thinking – identifying patterns across multiple data sets; people excel at tasks requiring contextual understanding, empathy and divergent thinking – exploring multiple solutions and idea generation. 

Glean actionable insights from your data ecosystem and predict customer behavior.

Marketers have a slew of data to sift through today, ranging from engagement data to web data; your challenge lies in determining which data is relevant. First, identify narrow and specific objectives; then, acquire relevant data sets. Finally, integrate data into your data management platform – which you should connect to a machine learning or analytics engine before launching data-driven offerings and campaigns. Profile customers with segments-of-one marketing, considering demographic, geographic, behavioral and psychographic factors – for example, passions and interests. You may choose to cluster customers together by the more cost-conscious, for example, or first-time buyers.

“The market is heterogeneous, and every customer is unique. This is why marketing always starts with segmentation and targeting.”

Use predictive analytics to stay ahead of your competition. Estimate potential customers’ value before deciding how much your organization should invest in them. Your marketing team should work with data scientists and statisticians to construct your predictive marketing model. The most common models are as follows:

  • Regression modeling – This model looks for statistical equations that can explain relationships between variables. 
  • Collaborative filtering – This model builds recommendation systems by predicting how customers will rate future products.
  • Neural networks – This model uses machine learning to make complex predictions and create models using large, unstructured data sets.

Personalize customer journeys with contextual and augmented marketing.

When you create contextual marketing experiences, you personalize moments of your customer’s journey with sense-and-respond technology. AI can use sensors and cameras to gauge a potential customer’s interest level or emotions, while drawing insights from external information – such as local events or the weather – to individualize experiences. Create a connected ecosystem of devices and sensors to deliver personalized responses to customers. For example, if a customer’s mobile phone is in proximity, and he or she has downloaded your app, his or her device will share data with your sensors. Your AI can then profile the customer by processing his or her data, and then share customized advertisements, offerings or experiences with the customer. 

Biometric technology is growing in sophistication, enabling AI to identify customers, after which it can profile them by predicting identity-related factors such as their gender, age and emotions. Marketers are in the early stages of using direct channels to reach their customers in their homes, through devices such as smart speakers.

“The objective of immersive, contextual marketing is to blur the borders between the physical and digital worlds so that customers feel a seamless omnichannel experience.”

Embrace augmented marketing, creating collaborations between humans and machines to achieve optimal customer interactions. For example, you can empower frontline human workers with tech by giving them access to data-driven insights about customers, so they appear well-informed and knowledgeable. Aim to immerse customers in the digital world, even when they visit your physical space, by maximizing their experience with personalized apps. This could mean, for example, using geolocation data to guide a customer through your store. 

Agile marketing enables teams to stay competitive amid market uncertainty.

You can no longer rely on traditional marketing models, because product life cycles across industries are shortening. High tech companies lead the way in embracing agile marketing by monitoring and responding to shifting customer behaviors and trends. Combine agility and operational stability to keep pace with your competition and grow amid the uncertainty, volatility and complexity of the market.

“Businesses need to match the speed of customer shifts and outpace the competition at the same time. Agility is the new name of the game.”

Developing agile marketing requires restructuring your organization to adopt these key components:

  • Real-time analytics – Empower your company to experiment and learn quickly by updating your analytics capabilities. Employ real-time customer data capture to identify problems and growth opportunities, leveraging the power of social listening tools and geotagging.
  • Decentralized teams – Avoid organizational silos by creating small, decentralized and cross-functional teams to tackle different problems simultaneously.
  • Flexible platform – Consider moving to a flexible product platform – for example, a subscription-based service – to make it easier for you to customize your product.
  • Concurrent process – Agile teams conduct development and experimentation phases concurrently, which requires constant coordination and clear communication regarding each incremental change and progress. Teams should schedule short, daily meetings to facilitate this process.
  • Rapid experimentation – Help teams learn by conducting fast experiments with small batches of your product, which will help you refine it and measure market reception.
  • Open innovation – Henry Chesbrough coined the concept of “open innovation,” which refers to a business’s ability to open up its innovation process and seek external solutions and ideas. For example, you might open-source your technologies, enabling external developers to improve them. Rather than limit yourself to your internal talent pool, consider opening up to ideas, talents and solutions from around the globe.

About the Authors

Marketing professor at Kellogg School of Management Philip Kotler is a Wall Street Journal Most Influential Business Thinker. MarkPlus, Inc.’s founder and executive chairman Hermawan Kartajaya is chairman of the Asia Council for Small Business and co-founder of the Asia Marketing Federation. Editor-in-chief of Marketeers Iwan Setiawan is chief executive officer of MarkPlus, Inc.

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