[What You Need to Know Now] The Latest on Audience Data (Part 1)

How will the advertising and marketing industry, now rapidly converging with technology, transform in the future? A young planner tackling digital marketing at Dentsu Digital Inc. will explain the latest insights centered on "Data × Marketing."

In the first installment, we discuss the current state of audience data utilization with Ryoji Yanashima, CEO of Intimate Merger (IM), which supports corporate data utilization; Sohei Mitani of Dentsu Inc., who is at the forefront of data marketing; and Jun Goto of Dentsu Inc., who promotes alliances with various digital marketing companies.

(From left) Mr. Sohei Mitani (Dentsu Inc.), Mr. Ryoji Yanashima (Intimate Merger), Mr. Atsushi Goto (Dentsu Inc.)

――First, please tell us about the work you are engaged in.

Yanashima: I serve as the representative of IM, which builds data-driven marketing environments and supports their utilization. We assist clients in creating initiatives that span from discovering potential customers to driving purchases, using both the clients' own data and our company's audience data. We are seeing an increase in clients from industries where high-value targeting is relatively important, such as automotive, insurance, finance, and real estate.

Goto: I work in Dentsu Digital Inc.'s Digital Marketing Center, providing marketing support to companies in industries like telecommunications, finance, real estate, and consumer goods. I'm also responsible for developing and promoting Dentsu.io, our big data solution, acting as a hub connecting various partners. Every day, I challenge myself to solve increasingly sophisticated marketing issues for our clients, striving to plan approaches that transform companies' marketing processes in unprecedented ways.

Mitani: Since joining Dentsu Inc., I've worked in the digital × direct marketing domain. My assignment to Nextedge Dentsu Inc., which specializes in this field, and my involvement in projects designing end-to-end solutions—from branding for an electronics manufacturer to direct-to-consumer e-commerce—led me to focus recently on digital strategies not only targeting existing customers but also increasing potential customers.

――IM and Dentsu Inc. also collaborate to provide services through the cloud-based data analytics platform Dentsu.io. What was the intention behind this?

Yanashima: When we talk about data-driven marketing, it often feels confined to digital initiatives alone. But I always believed it could be applied beyond digital, to mass advertising and other areas too. The collaboration with Dentsu Inc. sparked the idea that we could create a marketing environment balancing online and offline efforts.

Goto: As Mr. Yanashima mentioned, Dentsu Inc. has inherent strengths in mass advertising and offline initiatives. We also aimed to generate strong synergy with partners like IM. In fact, data utilization in offline settings has advanced significantly, hasn't it?

Yanashima: Retail has many examples. Recently, we conducted a campaign at a regional supermarket using app-based targeting to compare cost performance between newspaper flyers and push notifications.

Effectiveness verification using member IDs and POS data is also increasing. Geofencing (like check-in functions using mobile device location data) is another example. With the success of MUJI Passport by Ryohin Keikaku, such cases are growing.

Mitani: While e-commerce penetration grows yearly, it's also true that more purchases happen in physical stores. So, properly linking the effectiveness of digital initiatives to actual store sales is crucial. In the projects I manage, I'm getting more requests to visualize how digital initiatives contribute to offline sales.

Data-driven effectiveness verification is now being applied not only to digital initiatives but also to offline ones, marking a recent trend.

The Future of KPI Setting

――You mentioned that direct marketing approaches are changing offline strategies. Are they influencing other areas as well?

Mitani: I believe the direct marketing approach can also be applied to so-called branding initiatives targeting potential customers, aimed at increasing awareness or changing attitudes.

Of course, such efforts existed before, but they often stalled due to reasons like "platforms not being ready," "high costs," or "unclear KPIs." With advancements in ad tech and the emergence of services like those provided by IM, the groundwork is now in place. Consequently, this market will continue to grow significantly.

Yanashima: What was the biggest reason for the previous setbacks?

Mitani: Effectiveness verification, first and foremost. For example, with direct marketing, if you spend ¥500,000 and acquire 5 customers, the CPA (in this case, ¥100,000) is clear. But if you report buying a ¥25 million ad slot for awareness and getting 50 million impressions, it inevitably leads to questions like, "So how many customers did that actually acquire?"...

Impression-guaranteed ads are often compared to direct campaigns simply because they're digital. This tends to lead to the argument that branding campaigns don't align with CPA.

Yanashima: It's crucial to set KPIs not by saying "Let's evaluate it by CPA because it's digital media," but rather by deciding things like "Since it's an awareness-building initiative, let's use the same metrics as mass advertising" or "Since it's acquisition-focused, let's look at CPA or CPO." Surprisingly, this hasn't been done much until now.

Mitani: Furthermore, it's almost always framed as a dichotomy: "direct campaigns that only look at short-term CPA" versus "branding campaigns that only look at reach or click-through rates." But in reality, the strategies bridging that gap are crucial.

The ideal approach—one we're committed to—is seamlessly planning and executing the entire journey from awareness to purchase. This leverages digital strengths: identifying targets, delivering personalized 1-to-1 messaging, and elevating purchase intent at the individual level. It transcends mere awareness or conversion.

Goto: So it's about designing initiatives with the entire marketing landscape in mind, bridging the gap between brand awareness and purchase, right?

From a field perspective, another challenge was that clients' organizations were often split between digital and mass media teams, making it difficult to establish cross-channel metrics. However, I sense a shift towards integrated teams lately. In that sense, I believe this challenge will gradually be overcome. Moreover, I think the industry itself will become more dynamic if we can make proposals that delve into such organizational structures.

Against the backdrop of technological progress, it has become clear how data is beginning to be leveraged for offline initiatives and branding strategies. In the second part, we will delve deeper into the potential of audience data, which holds the key to these initiatives.