What Dentsu Inc. and CARTA Offer Clients in the DX Era

CARTA HOLDINGS, INC (hereinafter CARTA) is expected to significantly accelerate the digital transformation (DX) of media solutions within the domestic Dentsu Group.

We spoke with Mr. Shinnosuke Usami, founder and CEO of VOYAGE GROUP, who has assumed the role of Chairman at CARTA, and Mr. Norihiro Kureya, Vice President of Dentsu Inc., about the digital platform vision CARTA and Dentsu Inc. are pursuing.

Shinnosuke Usami, Chairman, CARTA HOLDINGS, INC; Norihiro Kureya, Executive Vice President, Dentsu Inc.
At the CARTA HOLDINGS, INC office (Shibuya Solasta)

<Table of Contents>
▼The Need for Dentsu Inc. to Strengthen Its Data Technology Capabilities
▼The "Multiplier Effect" of Digital Platforms and Mass Media Becomes Essential
▼Dentsu Group Leading the Rapidly Changing Digital World
 

The Need for Dentsu Inc. to Strengthen Its Data Technology Capabilities

──VOYAGE GROUP, a leading digital advertising platform, merged with Cyber Communications Inc. (CCI) of the Dentsu Group to form CARTA HOLDINGS, INC. What does the birth of CARTA mean for Dentsu Inc.?

Kureya: Dentsu Inc. aims to provide integrated services that contribute to our clients' business growth. The data technology domain is crucial for this, and we wanted to further enhance the domestic Dentsu Group's resources in this area.

Therefore, we envisioned combining VOYAGE GROUP, which excels in digital platform technology, with CCI, which handles publishers and media within the domestic Dentsu Group.

Usami: From VOYAGE GROUP's perspective, the purpose of the management integration is to further grow our advertising platform business and expand its potential. VOYAGE has grown primarily through its digital advertising platform business. While we are strong in transactional advertising and performance advertising, we were weaker in dealing with so-called brand-focused advertisers and premium media. To strengthen these weaker areas and achieve greater growth, CCI was an excellent fit.

However, it's not simply about "collaborating with CCI to leverage each other's strengths in online advertising." Advertisers now conduct cross-campaign planning without separating performance and branding advertising. That's precisely why we must provide advertising platforms and products capable of handling both. Consequently, the first product born after the management integration was "PORTO" ( https://porto.cartaholdings.co.jp/ ), an integrated marketing platform for brand advertisers.

──So, advertisers today demand advertising services that combine VOYAGE's expertise in programmatic performance advertising with the strength of Dentsu Inc. in branding advertising.

Usami: Yes. Furthermore, mass media like TV and radio will also advance DX, leading to increased programmatic advertising. We believed that by collaborating not just within CCI but across the entire Dentsu Group in Japan, we could create a more exciting future. That's why, from the start, we discussed DX in mass media with various people within Dentsu Inc. And just recently, we were finally able to release it as the next-generation TV marketing platform "PORTO tv" ( https://portotv.cartaholdings.co.jp/).

──Why did you choose a management integration rather than a business partnership?

Kureya: Merging management allows us to accelerate everything. It enables us to oversee the entire group's resources and streamline or strengthen operations as needed. Our cultures were a good fit, and our core objectives weren't vastly different, so we decided a management integration was the best path from the start.

Usami: We never considered a business alliance either. We've always believed that if we're going to do something together, it has to be with the mindset of "we're in this together, through thick and thin." Management integration involves pain for both sides, but there are aspects you can't see unless you take that step. It forces the front-line teams to truly collaborate, and we felt that without that, nothing new would emerge.

The "multiplication effect" of digital platforms and mass media is essential

──Currently, the Dentsu Group in Japan is significantly advancing DX for clients and media. Could you clarify CARTA's role within this DX promotion strategy?

Kureya: In the coming era, the "multiplier effect of digital platforms and mass media" will be crucial. Within the Dentsu Group, I believe CARTA, which already has a proven track record in operating its own digital platform, possesses this capability particularly well.

Today's Dentsu Inc. provides integrated solutions that go beyond advertising and communication, focusing on "committing to our clients' business growth." However, if we continue along the same path, we risk becoming an intellectually labor-intensive business that relies heavily on brainpower. If we try to generate significant profits as a fee-based business, we'd need to deploy more people, leading to burnout and reaching revenue limits. That's precisely why we need to build systems that aren't labor-intensive. Together with CARTA, we'll create a platform that significantly boosts productivity and profitability as more data is accumulated.

──Shortly after CARTA's launch in May 2019, you released "Premium Audio Advertising" alongside Dentsu Inc. and Dentsu Digital Inc. This platform delivers ads to audio media like radiko and Spotify. Would you say this marks your entry into the branding domain?

Usami: Actually, we had released "PORTO" a little earlier, in April. At its initial launch, PORTO functioned solely as a brand advertising DSP, supporting diverse display formats and leveraging VOYAGE GROUP's proprietary data. In May, we expanded its capabilities to include audio ad delivery. "Premium Audio Advertising" represents the first initiative in the brand advertising collaboration between Dentsu Inc. and CARTA.

Since then, "PORTO" has been working on expanding and improving features like "Premium Audio," "Premium DOOH," and "Premium In-Stream." Looking ahead, we also aim to integrate it with "PORTO tv," which we recently released. PORTO aims to be a unique, integrated marketing platform for brands that can measure, manage, and deliver diverse formats across online and offline channels, not just optimize for digital or TV commercials alone.

While we're still exploring some aspects of the necessary features and requirements for a brand advertising platform, working alongside Dentsu Inc. members who actually handle mass media sales has revealed various possibilities for this new platform.

Kureya: Working together, I feel that CARTA has a strong internal technology team, so whatever we do, the speed is fast. In digital business, you can't expect perfection from the start. The speed to quickly try POCs (proof of concept) and immediately address areas needing improvement is paramount.

──Listening to you, it sounds like even though the entry point was the management integration with CCI, the vision is for CARTA to be integrated within the entire domestic Dentsu Group and collaborate.

Usami: By creating PORTO and launching Premium Audio ads, Premium DOOH ads, and PORTO tv, we've built the foundation for integration. This year, we want to deepen collaboration with other domestic Dentsu Group companies. CCI has always worked on various initiatives with other group companies, but recently, we've seen new collaborations emerge, like our business partnership with IPG Inc., which operates G-Guide, for data marketing using program content data.

──Is it accurate to understand CARTA's current mission as the digital transformation (DX) of mass media like television?

Kureya: While television remains where clients allocate the largest budgets, it is currently undergoing transformation. Planning increasingly incorporates diverse digital data, a trend set to accelerate further. The very definition of television is shifting—broadcasters now distribute programs online, while conversely, viewing digital content on TV has become commonplace. Essentially, "everything is becoming digital media."

However, just because something is digital doesn't mean the transaction models or platform structures of digital advertising can be directly applied to television. In some areas, we must adapt the mechanisms used for traditional TV commercials. Within this context, I believe CARTA, which possesses both VOYAGE GROUP's digital advertising expertise and Dentsu Inc.'s mass media know-how, will play an increasingly vital role.

Dentsu Group leading the rapidly changing digital world

──Precisely because the boundaries between digital and mass media are dissolving and beginning to merge, there is a role for a company like CARTA, which possesses expertise in both.

Kureya: To reiterate, the domestic Dentsu Group, including CARTA, is striving to become an entity that can provide integrated solutions contributing to clients' business growth. While other advertising agencies and consulting firms are moving in a similar direction, none have fully realized this yet. Dentsu Inc. possesses the most robust resources necessary for "providing integrated solutions." By swiftly creating case studies and clearly demonstrating the group's direction, we can help clients understand the difference we offer compared to competitors.

──So, by providing clients with integrated digital platforms that go beyond simple media DX, you support the growth of their entire business. In this case, it requires not only consulting but also the technical and development capabilities to actually create and operate the products and services delivered to clients.

Kureya: That's a fundamental premise. The core of data technology, including globally, is centered on the concepts of "people-based" and "people-driven." Essentially, companies that can provide optimal experiences tailored to each individual's interests, concerns, specific actions, environment, and state—rather than relying on vague market perceptions—are the ones that can achieve growth.

To achieve this, a robust technological foundation is essential, along with the capability to handle this people-driven data. Possessing richer, deeper, and more comprehensive data enables us to drive our clients' business growth. This is the shared commitment not only domestically but also across Dentsu Inc.'s global operations.

──CARTA is already realizing DX for mass media like audio ads and TV commercials using the PORTO platform. What future developments are you envisioning?

Usami: Going forward, there is a movement across the entire Dentsu Group in Japan to strengthen solutions like platforms and products. CARTA aims to contribute to enhancing the Dentsu Group's competitiveness and growth by creating "weapons" in the digital domain.

While we've focused on integrating with CCI over the past year, I believe both clients and the domestic Dentsu Group still find it challenging to fully grasp what kind of company CARTA is. Therefore, we want everyone within the domestic Dentsu Group to understand that by deepening collaboration not just in business but in various areas, we can create new possibilities together. We also want to actively communicate within the group about what CARTA can do and its potential.

Kureya: Initiatives where mass media, starting with television, use online channels to deliver their own content will continue to expand. I believe Dentsu Inc., including CARTA, is best positioned to provide the optimal platform for this.

Moreover, our expectations for CARTA extend beyond just technology. The digital industry is constantly changing at a dizzying pace; what we're saying today might look completely different next year. Within this dynamic landscape, VOYAGE GROUP has a proven track record of significant growth through multiple major shifts in direction. I believe the entire domestic Dentsu Group can learn from Mr. Usami's approach: not being bound by past successes, but always taking the initiative to lead change.

The Dentsu Group already possesses abundant diverse talent and resources. By adding CARTA's technology and culture to this mix, we aim to build a group that can deliver even better solutions to our clients.