The reason corporate DX isn't progressing is because these "two engines" are missing!

Today, digital transformation (DX) is unavoidable for every company and every business.

Dentsu Inc. and Dentsu Digital Inc. have begun collaborating with Treasure Data, provider of Japan's leading CDP (Customer Data Platform) "Treasure Data CDP," to drive clients' DX and accelerate their business.

In the era of DX, marketing requires two essential engines: a data foundation and customer experience. This series will explore the new customer experiences that Dentsu Inc. and Dentsu Digital Inc., as marketing companies, will create in partnership with Treasure Data.

This time, we spoke with three key figures about the essentials for achieving corporate DX: Kazunari Takagi, Sales Director for Data Business at Treasure Data; Akihiko Miura, who drives business transformation support at Dentsu Inc.; and Takashi Uozumi, who handles DX support at Dentsu Digital Inc.

<Table of Contents>
▼What is essential for advancing DX?
▼The most important thing is "Why are we pursuing DX?"
▼How will DX transform digital marketing?
▼Interpreting and Utilizing Data Leads to Value for Consumers

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What is needed to advance DX?

──Today, every business is constantly connected to consumers digitally. Against this backdrop, DX of business models built on this premise is an urgent necessity. In this context, please explain the background behind Dentsu Inc. and Dentsu Digital Inc. partnering with Treasure Data to "support client companies' DX."

Miura: We've been hearing more and more from clients saying, "We need to understand and utilize data." I belong to the Transformation Production Bureau at Dentsu Inc. As the name suggests, it's a department that supports clients' marketing DX, from conceptualizing the transformation of their entire business to executing it.

Needless to say, DX is not merely about "digitizing corporate operations." The fundamental premise is shifting from the traditional business model of "selling products and services to consumers" to a "consumer-first" business model that maintains constant digital connection with consumers.

To place this "consumer-first" approach at the heart of DX, it is essential to centrally collect, store, and integrate the data necessary to gain consumer and customer insights. Furthermore, analyzing and utilizing this data to obtain deep customer insights is required.

As a tool for this purpose, we believe Treasure Data's customer management platform, "Treasure Data CDP," provides an exceptionally strong data foundation.

Of course, Dentsu Inc. possesses long-cultivated strengths in creativity and communication. However, since DX fundamentally requires combining "data" with creativity and communication, we believed partnering with Treasure Data—which possesses Treasure Data CDP—would enable us to contribute more effectively to our clients' DX.

Takagi: Thank you. Due to the impact of the novel coronavirus, interest in data utilization and digitalization is growing even more among Japanese companies. We at Treasure Data are receiving many inquiries, but ultimately, data is merely a "means" for client companies to advance their business.

Simply collecting and managing data is meaningless. Companies must consider what value they will provide to their end users—consumers—beyond digitalization.

As Mr. Miura mentioned, by leveraging and complementing each other's strengths—Treasure Data in data and Dentsu Inc. in creative and communication contexts—we can enable more robust customer experience design.

From this perspective, we are pleased to announce that Dentsu Inc. and Dentsu Digital Inc. have joined as the first official partners certified under Treasure Data's official partner program, the "Treasure Data Partner Certification Program," and we will advance our collaboration.

Uozumi: Our mission at Dentsu Digital Inc. is to support clients across a wide range of industries within the Dentsu Group in Japan, focusing on digital-driven business and building optimal marketing systems.

In terms of integrating with various tools and technologies as a platform, Treasure Data is a company that shares our vision. We will be able to demonstrate greater strength in the field of data technology. We are very pleased to be collaborating.

The most important thing is "Why are we pursuing DX?"

──While momentum for DX is growing, what challenges do companies face?

Miura: We support clients from the perspectives of business design and customer experience design. Within this work, we sense a very strong sense of urgency among companies that DX is necessary. The keyword that often comes up first in these discussions is "1ID (One ID)".

The idea is that by maintaining a single ID per customer as data, we can provide the information and services customers seek more effectively than ever before. The common challenge for companies is how to unify their customer base to achieve this.

Uozumi: The difficulty in designing a customer base around 1ID lies in the fact that business units and IT departments often have different KPIs (Key Performance Indicators) set. Facilitating smooth cross-departmental collaboration is no easy task. It takes time for each department to align their objectives with those of other departments.

For example, even if both the business unit and the marketing department have IT elements, integrating different IT infrastructures and data is rarely straightforward. In other words, I feel it's urgent to develop personnel who can drive both customer base design and integration with other departments' infrastructures.

Takagi: The challenge you mentioned, Mr. Uozumi—where different corporate departments hold data separately, leading to departmental silos—can be effectively addressed with Treasure Data CDP.

By integrating data on a single platform and unifying it under a single ID, it's now possible to derive customer insights and marketing strategies that were previously difficult to visualize. However, even if it's technically feasible, actually connecting it to business outcomes and realizing it remains challenging.

Miura: The most crucial thing is "Why are we pursuing DX?" Whether the impetus comes from management issuing a directive to pursue DX or from a grassroots desire to advance DX, without a clear "Why," transformation won't progress.

Takagi: As providers of data infrastructure, we've observed that successful cross-departmental data integration in companies often hinges on the strong conviction of those driving the project—their clear vision of "how to transform the business."

How will DX transform digital marketing?

──As DX advances and "consumer-first" business models expand, how will digital marketing change?

Uozumi: Speaking personally about the ideal I aim to achieve by driving clients' DX, I believe it lies in "redefining business beyond the narrow confines of digital marketing's worldview."

──Please elaborate.

Uozumi: I've worked in the digital field for nearly 20 years. When viewed narrowly, digital marketing was fundamentally about managing data to target audiences, delivering information like ads, promotions, and coupons to consumers, and measuring conversions. The key metric emphasized was increasing customer numbers. However, I believe this type of digital marketing is becoming less mainstream.

For example, consider the LTV (Lifetime Value) metric. It involves concepts like consumer retention rates, retention periods, average purchase value, and customer retention costs. In this context, increasing the LTV index involves various variables beyond simply increasing customer numbers.

In other words, despite the significant potential for strategic initiatives, the narrow focus on customer acquisition numbers and cost efficiency alone defined the worldview of digital marketing in its narrow sense.

──With populations declining globally and the COVID-19 pandemic severely impacting economic activity, the question arises: how long can digital marketing keep pursuing the expansion and reproduction of customer numbers? Isn't there already a limit to that? Mr. Uozumi, what role do you expect Treasure Data to play in providing clients with this new value in digital marketing?

Uozumi: First, I believe the Treasure Data CDP's strength lies in its flexibility—its ability to adapt to any form. However, the fundamental prerequisite for leveraging this system is significantly increasing the "exits" for "data value."

When considering the purpose of data, its value shouldn't be limited to simply improving targeting accuracy. Data can also be leveraged to "transform customer experiences and increase retention rates" or "enhance operational efficiency and reduce costs."

It's about redefining business using data, not just staying within the marketing domain. Treasure Data CDP serves as the platform that acts as both the data's entry point and exit point for this purpose.

Interpreting and leveraging data connects to the value for consumers.

──What does Treasure Data expect from its partnership with Dentsu Inc. and Dentsu Digital Inc.?

Takagi: In designing customer experiences today, technology and communication have become inseparable. Both data and creativity are essential. In that sense, we look to Dentsu Inc.'s strength in communication and creative domains.

What kind of experience should customers have to deepen their connection and increase engagement? To answer that, first we must understand the customer. Therefore, data alone, like survey results, is meaningless. What matters are the insights derived from that data.

Treasure Data CDP is a foundation for storing data, but the data itself is merely supplementary material for considering how to provide value to consumers and customers. What's crucial is how to design the experience and how to communicate. In these areas, I believe Dentsu Inc. is the best partner.

Miura: Simply implementing a system to manage customer data doesn't lead to DX, does it? From a consumer-first, customer-first perspective, we design communication to enable each company to deliver its unique services and value in a better way.

Dentsu Inc.'s strength lies in providing insights into "where and what messages to deliver to create truly satisfying customer experiences." By interpreting Treasure Data CDP's data and linking insights from that data to actual marketing initiatives, we can create optimal, one-of-a-kind communication for both companies and customers. That, I believe, is the essence of DX.

Uozumi: Treasure Data CDP is the data hub, and Dentsu Inc. is the business hub. If we liken this relationship to the human body, "data is the blood flow, and business is the muscle." Without either, the body cannot function, right?

Overemphasizing data alone won't make DX successful. Data is merely a means; the essence lies in what value we want to provide to consumers. We aim to create a cycle where delivering good experiences to customers leads to better data being generated.

Miura: The Dentsu Group champions "Good Innovation." as its corporate philosophy, committed to delivering new value that contributes to clients' business growth. Innovation arises from combining knowledge with knowledge, technology with technology. By collaborating, Treasure Data and Dentsu aim to fuse data with creativity, becoming an engine that accelerates DX for clients, the consumers they connect with, and ultimately society as a whole.

In fact, under our collaborative framework, we've already entered the APAC (Asia-Pacific) market and are expanding our partnership network. Furthermore, Treasure Data CDP is being utilized not only in marketing but also as a data foundation for planning how IoT and connected data can be transformed into customer experiences. We want to further drive this engine that's already turning, connecting it to the digital transformation of society as a whole.

If you are interested in the solutions provided through the collaboration between Treasure Data and Dentsu Inc./Dentsu Digital Inc., please feel free to contact us.

[Download Overview Materials Here]
https://www.treasuredata.co.jp/dx-engine-download/
[Contact Us Here]
https://www.treasuredata.co.jp/dx-engine-contact-us/

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