The next move in digital marketing. What is the technology that will "replace" cookies?

How do breakthrough ideas that drive transformation across companies and entire industries emerge, and what future do they bring? The original program 'Breakthrough Ideas' delves into untold stories to find fuel for tomorrow's business.

In this fourth episode, we explore a new vision for the future of digital marketing through "data clean rooms," which are replacing cookies.

Moderated by Norihiko Sasaki (CEO, PIVOT). Guest MC: Shun Maekawa (Data & Technology Center, Dentsu Inc.). Joining us are: Meiko Kobayashi (Marketing Division 1, Consumer Business Unit, Asahi Group Foods Ltd.), Tatsuya Eda (Head, OMO Sales Promotion Office, LINE Corporation), and Ken Okada (Unit Manager, Sales Promotion Unit, Yahoo Japan Corporation).

※This article is reprinted from NewsPicks.

What is a Data Clean Room, the Replacement for Cookies?

Sasaki: First, what exactly are cookies?

Maekawa: Cookies are a technology for identifying customers, enabling temporary sharing of customer information across sites with different domains. This technology has allowed companies to measure advertising effectiveness and estimate customer preferences while conducting marketing activities.

Over the past decade, cookies have become the foundation supporting digital marketing.


Sasaki: What impact will the future discontinuation of cookies have?

Maekawa: While cookies are convenient, they are also a technology that can circulate customer information online with ambiguous consent from the customer. Replacing this with a technology called the data clean room in the future will enable companies to conduct marketing activities while protecting customer information.

Sasaki: Cookies have played a crucial role in digital marketing. Mr. Kobayashi, from your perspective as a client involved in marketing, how do you view the move towards a cookie-less environment?

Kobayashi: It's said that going cookie-less will make it impossible to implement digital marketing strategies like targeting. The challenge is figuring out how to respond to that. We are considering countermeasures, but we haven't finalized exactly what we will do.


Maekawa: The period when cookies will become completely unusable is said to be between next spring and the end of the following year. Not only Asahi Group Foods, but all clients currently utilizing digital marketing are seeking countermeasures for when the cookie-less era arrives.

Sasaki: So, what exactly is this "data clean room" technology that helps navigate this cookie-less era?

Maekawa: A data clean room refers to a specialized environment accessible only to data scientists with specific technical expertise. It combines a data infrastructure that balances privacy protection with client companies' marketing needs. We believe it will be applicable across various fields in the future, including advertising and sales promotions.

Sasaki: What's the difference between cookies and data clean rooms?
Maekawa: Unlike cookies, data clean rooms can accumulate customer information and other data over the long term. Customer information gathered in a data clean room is unified by ID, making it easier to identify. By effectively utilizing this data, clients can conduct continuous marketing activities.


Furthermore, while only 12% of customers continued purchasing products without effective marketing strategies, utilizing the data clean room to target specific customers with ads increased this rate to 19.8%.


Sasaki: Asahi Group Foods is using data clean rooms to execute digital marketing with Dentsu Inc. What were the results?

Kobayashi: Utilizing the data clean room enabled us to visualize customer purchase behavior data.

Sasaki: Are there any challenges with data clean rooms?

Maekawa: Handling data clean rooms requires not only specific technical skills but also a deep understanding of privacy. The challenge is the scarcity of personnel possessing these capabilities.

Furthermore, client companies also need to understand data clean rooms, so we feel educational activities for clients are necessary.

Digitalization in Sales Promotion

Sasaki: Alongside advertising, digitizing promotional activities like campaigns has become essential, hasn't it?

Maekawa: When conducting marketing activities, how platform operators return customer information to customers becomes crucial.

Sasaki: Could we hear from Mr. Eda and Mr. Okada, who handle marketing from the perspective of platform providers like LINE and PayPay, about specific aspects of digital promotional activities?

Eda: I handle digital sales promotion at LINE and work on the "Apply via LINE" campaign platform, which allows anyone to easily enter campaigns.


Its key feature is that if users have the LINE app, they can participate in campaigns without having to input their personal information. Additionally, clients can track what users have purchased and send personalized 1-to-1 messages via their LINE Official Account.


Okada: I develop solutions using PayPay. I'm working on a campaign called "PayPay Gift," which leverages PayPay's payment integration feature, allowing customers to participate simply by purchasing a product.


Users can join campaigns simply by using PayPay, and clients can now promote sales to all PayPay users without limiting it to specific segments.

Maekawa: Platform mechanisms like "Apply via LINE" and PayPay have lowered the barriers for users to participate in campaigns by making a purchase or collecting points.

The Future Potential of Digital Promotions

Sasaki: What growth potential and challenges do you see for digital promotions?

Okada: By integrating online and offline purchase data, we can guide each customer to the products they need, fostering a continuous connection between products and customers.
As a guiding principle for Yahoo and LINE's joint efforts, we aim for "stock-based" solutions. By digitizing detailed information about customers who purchase products via PayPay, we envision a future where clients can understand how to best encourage purchases for specific customers.


Eda: Currently, using beacon technology, we can detect when users who have consented to location sharing visit a store. We also need to consider what information to send to whom and at what timing.

Maekawa: Platform operators holding vast customer data can expand the scope of marketing activities enabled by digital promotions. It's crucial to consider what value a single marketing strategy, derived from various options, brings to clients.

Furthermore, as physical spaces become increasingly connected online, methods commonplace in the digital realm can now be applied offline. The key lies in how we translate collected data back into enhanced customer experiences.

Sasaki: As digital promotions continue to evolve, what will become possible in the future?
Okada: At PayPay, we aspire to become the wallet that knows its users best. Understanding each user's behavior and purchases will enable us to deliver personalized, optimal information to every individual.

Kobayashi: From a client perspective, I hope digital marketing strategies can enhance corporate branding.

Eda: Moving forward, the focus should be on enhancing the user experience. The information customers want differs depending on whether they're in-store or not. Delivering information at the right moment can significantly improve that experience.

In a LINE Research survey asking "Do you seek information tailored to you?", 81.6% responded "Yes." This indicates that when customers provide their information to companies, they tend to expect companies to deliver information suited to them.


However, there's a crucial point to note: even within 1-to-1 communication, a certain number of customers feel aversion to messages that identify details like their family structure. Understanding what information customers find "welcome" versus "unwelcome" is essential.

Maekawa: User sentiment cannot be resolved by algorithms alone; ultimately, people must think about it. Therefore, I believe how we combine science with customer experience design is crucial.

Sasaki: What role does the data clean room play in the field of digital sales promotion?

Maekawa: The benefit of data clean rooms is that clients can visualize various data within an environment that protects personal information and leverage that for marketing strategy. For example, TV advertising has value both for toC (connecting to customer purchasing behavior) and toB (ensuring products are placed on shelves). Since such information exists in data clean rooms, it's crucial to consider how to utilize it effectively.

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Learn more about Dentsu Inc.'s business transformation here.