Lesson 6: Enriching Innovation Thinking Through Digital

This course has systematically introduced the problem-solving techniques and creative approaches to digital marketing practiced by current Dentsu Inc. planners. In this sixth session, we discussed new ideas using digital tools. Today, we will review that lecture and answer questions from participants.

The lecture began with a review of previous sessions. For this part, please refer to the Schoo lectures orthe review edition of the Dentsu Inc. Newsletter.

Where is the digitalization of marketing headed?

 

Even counting from the release of Windows 95, digitalization and the digitalization of marketing have actually been around for about 20 years. I believe many corporate professionals and marketers are aware of the challenges surrounding "the evolution of ad technology," "optimizing mass advertising and digital advertising," and "implementing marketing systems," and are actively trying various approaches to introduce them. Furthermore, the methodologies for achieving efficiency, optimization, and reducing operational costs through this digitalization have largely solidified. Currently, while assisting various client companies with their marketing digitalization, I increasingly find myself discussing how to achieve the following: "Beyond the minimum goals of efficiency and cost reduction through digitalization, how can we contribute more to sales? Are we loved as a brand?" "Are we gaining new customers and retaining existing ones?" "Are we increasing our fan base, and consequently boosting sales?"

In other words, it's shifting the perspective from merely "optimizing marketing costs from the company's viewpoint" to "how much can digital contribute to enhancing customer satisfaction from the customer's viewpoint?" In terms of the "Revenue - Cost = Profit" equation, while cost reduction has become achievable through digitalization, the discussion now centers on: what about the part that delights customers and increases sales? I feel this perspective is still relatively rare in the digital world.

Compared to mass advertising-centric marketing, digital marketing enables:
I. The results of initiatives have become "visible," II. The "coordination" of various initiatives is now possible, III. And "real-time" responses have become feasible. In the past, coordination between initiatives was often just lip service due to organizational silos and difficulties in easily sharing data. Recently, however, it has become possible to actually coordinate and collaborate by leveraging data and technology. This means that in practicing marketing, "long-term brand building" and "short-term sales growth" – concepts previously discussed as almost opposing ideas – can now be integrated. Marketing can be seen as being right in the middle of the "Connected Era," where everything is linked through data and digital. And this Connected nature impacts not only the links between mass media and digital media, or between campaign initiatives, but also the entire marketing landscape, the business beyond it, and society (social).

Enriching Innovation Thinking Through Data Utilization

 

First, let's discuss innovation in data utilization within the marketing domain.
We introduced initiatives building new relationships between consumers and brands, sometimes called "Connected Branding." Previously, even when TV commercials were used to enhance a product's brand image, coordination with subsequent digital sales promotion measures often failed. The new approach is to implement branding initiatives using digital, data, and technology, and to coordinate them with digital sales promotion measures.

The lecture specifically introduced six approaches:

① Personalized Videos
For CRM with existing customers or outreach to prospects, we create and deliver original videos tailored to each individual. These videos consider factors like gender, age, family structure, level of interest in products, and items under consideration for purchase. This service is frequently used for insurance services, banking services, mobile phone rate explanations, and introductions to booked travel plans – areas where sales staff often find it difficult to explain products or services verbally or in writing. This video generation service enables consistent, personalized product branding, material requests, and applications throughout the customer's lifetime. It contributes to both video-based branding and short-term sales promotion.

② Video Consulting Service: Scientifically Analyzing Emotions Through Data
We scientifically analyze emotions during video viewing using facial expression data and similar metrics. Based on these results, we re-edit and distribute the video. By precisely matching digital video content with viewer emotions, we enable branding strategies that effectively amplify targeted emotions even through digital video.

③ Leveraging Search Data
Search data is a treasure trove of needs. It can be used not only for short-term SEO measures in digital advertising but also to identify areas where your brand is under-promoted compared to competitors and to develop new brand messages. Utilizing Google Suggest (the assistive suggestions displayed during searches) can also visualize keyword relevance. Since these related terms change seasonally and over time, it helps determine optimal timing for message delivery and provides hints for developing new content angles.

④ The Evolution of Content Delivery Technology
Content is crucial across various scenarios, and the technology delivering that content continues to evolve with exciting new developments. For example, there are services that allow quiz-style questions within digital articles, enabling users to share their results. Placed on a brand introduction page within your company's website, these quizzes can deepen understanding of the brand's content. Users can then share their results via social media, potentially leading to further actions like specific product applications or requesting materials. This service enables a journey starting with brand understanding through content, all the way to the final conversion.

⑤ The Evolution of Customer Acquisition Technology
While "marketing automation" services that automate outreach to prospects are currently popular, it's said that only about 1% of potential customers actually have an email address that can be used for outreach. For the remaining 99%—the so-called "Unknowns" whose names and addresses are unknown—services exist that identify users based on cookie-based data like website visits and enable outreach. These services feature a simple, intuitive dashboard for managing both email-registered and non-registered users. For instance, users meeting certain criteria might be targeted with aggressive sales promotions due to high conversion potential, while others might be nurtured to build brand affinity first. Both promotional and branding approaches can be managed on the same dashboard.

⑥ Mass Media and Digital Visualization Service
Today, there's growing demand from CMOs and marketing managers to view all marketing data consolidated in one place. Simply viewing daily sales data alongside TV commercial airing data and web ad data in a chronological timeline reveals how they relate—or don't relate at all. Furthermore, we can visualize not only the direct impact of TV commercials on sales but also their influence on subsequent digital actions (such as website visits). By understanding the direct and indirect effects on sales, we can calculate the ROI for each channel. Consequently, we can now offer significantly more cost-effective solutions for optimizing the allocation between TV commercials and digital advertising to achieve specific sales targets.

Next, we'll broaden our perspective to introduce innovative ideas for business itself and society itself, leveraging data, technology, and content.

Business Innovation

 

Services like Uber, which lets you hail taxis via smartphone, and Airbnb, which enables renting unused rooms to travelers, are becoming well-known even in Japan. These are prime examples of businesses succeeding by leveraging location data, matching data, new technologies, and content. In the lecture, we introduced a conceptual framework for business creation, as shown in Figure 1, and provided hints for innovating the relationship between customers and brands by exploring what data to utilize.

Furthermore, recent technological advances have enabled Japan to build ultra-small satellites, and attention is actually turning to the business applications of satellite data.

Weathernews purchases its own satellites to constantly monitor Arctic sea ice melt. They check whether ships can transport goods via the Arctic Sea Route and notify shipping companies of viable timing. For example, shipping goods from Tokyo to Europe via the Arctic Sea Route halves the distance compared to the southern route, cutting transportation costs in half. This is invaluable information for shipping companies.

This type of data from ultra-small satellites is also used in agriculture, forestry, and logistics. It helps optimize crop harvesting and fertilizer timing, assess forest areas, detect wildfires early, gauge traffic volume at overseas store locations, and alleviate urban congestion. It's being applied to solve societal challenges that extend beyond individual companies. I believe that when diverse industries and regions collaborate to leverage data and technology, the world becomes far more convenient, paving the way for a happier society.

This time, I shared how we constantly consider new relationships between people and brands, exploring what data can be obtained, what technologies can be applied, and what kind of content should be created for these platforms. I also hope you now understand how this enables the visualization of diverse data, allowing seamless coordination between strategy and tactics, branding and promotion, and acquiring new customers while retaining existing ones. Going forward, I believe the goal of digitalization should extend beyond cost reduction and efficiency to focus on customer-centric satisfaction. This means fostering brand loyalty and ultimately driving sales growth. Furthermore, the digitalization of marketing itself will continue to connect and visualize diverse data. However, it won't stop at mere connectivity; the integration of artificial intelligence (AI) and similar technologies will lead to a smarter, more autonomous world requiring less human intervention. Digital is now transitioning from a world of "Connected" to one of "Intelligence."

Question from a participant

 

Finally, since we received many questions from participants in this course, I'd like to conclude by answering a few representative ones.

Question 1: How do you measure NPS (Net Promoter Score: a metric for customer recommendation) digitally?

Answer 1: In the past, it was measured through mailed surveys to existing customers. Nowadays, it can be easily implemented via email or pop-up surveys for visitors to product websites.

Question 2: I have the impression that digital services seem more advanced overseas (like the US?) than in Japan. Is that actually the case?

Answer 2: It's true that many groundbreaking new services (like Facebook or YouTube) originate overseas. However, Japan excels at refining existing services to perfection. Therefore, adapting overseas services to enhance quality is a viable approach.

Question 3: I've learned that machine learning and analytical/statistical skills are crucial for future digital marketing! I'd like to know the traits and necessary skills for someone suited to be a data scientist.

Answer 3: Improving data analysis skills is certainly important and requires daily dedication. However, I believe understanding people and customers is even more crucial. Especially in business, behind every customer data analysis result, there is always a "person" who took that action. Data scientists who can uncover what kind of consumers or customers, their underlying psychology, and behaviors are driving the data results will be increasingly needed in business going forward.

That concludes today's session. I hope this lecture offers some hints for your future work. The digital field evolves daily, and I too must continue learning constantly. Thank you all.