HDY Lexicon 2024

HDY LEXICON

Digital Full-funnel Marketing Edition

“There’s never been a bigger opportunity for the right minds with the right energy to come together to promote great solutions. Our job is to lead the way from a creative standpoint.”

Michael Birkin CEO, kyu Senior Executive Corporate Officer, Hakuhodo DY Holdings

Welcome to our Lexicon.

We are HDY Group, a unique network of companies that collectively empower our clients and society through creativity. We are a group whose strengths lie in creativity and “sei-katsu-sha(*)” insight, with origins that date back to 19th century Japan.

Today, we count over 450 subsidiaries and affiliates, and 27,000 employees working in more than 30 countries and regions around the world. Our business areas are diverse, including marketing services, and we bring together experts with various backgrounds. To unite in our expertise and collaborate more artfully, we’re excited to announce that we have developed the Lexicon.

As we continue growing as a creativity platform, we aim to leverage this Lexicon to ensure smooth and effective communication with our partners.

*In 1981, we introduced the term ”sei-katsu-sha” which literally means living people. When HDY group thinks about these people, they are not only consumers but real, living humans with day-to-day thoughts and feelings, emotional and intellectual needs, aspirations, concerns and worries. This approach is to emphasize our commitment to a comprehensive, 360-degree perspective on people’s lives.

TABLE OF CONTENTS

Page 09

Digital Full-funnel Marketing

Digital Advertising Page 15

Owned Media

Page 25

Commerce Page 33

CRM – Customer Relationship Management Page 41

Data & Analysis Page 57

CDP/DMP – Customer Data Platform & Data Management Platform Page 49

FULL-FUNNEL MARKETING

Digital Full-Funnel Marketing

Digital Full-funnel marketing is a comprehensive strategy that involves planning all stages of the customer journey using various marketing channels and touchpoints. In HDY, customer journey is broken down into 6 stages which are “Awareness”, “Interest”, “Consideration”, “Purchase”, “Repeat”, and “Continued Purchase”. Considering Sei-katsu-sha’s (refer to page 5) preferences and needs at every level is crucial because each funnel requires different approach.

Digital marketing activities are composed of two layers: “Execution” and “Infrastructure”. The execution layer comprises marketing solutions that are touchpoints with consumers. Within the “Execution Layer,” HDY defines four key digital marketing solutions: Advertising, Owned Media, Commerce, and CRM. Each marketing solution provides value in different stages of the customer journey, from initial awareness to conversion and beyond, increasing loyalty and leading to continued purchases.

The “Infrastructure Layer” refers to the development and operation of data infrastructure for clients to utilize data for marketing purposes. In all phases, from devising marketing strategies to execution, the utilization of data is crucial. The ability to leverage internal and external data depends on the data stored in CDP/DMP (refer to page 50-51). Establishing marketing infrastructure is essential for executing data-driven marketing.

To expand business in the digital full-funnel, it is significant to invest in both the “Infrastructure Layer” and “Execution Layer,” as they are interrelated (refer to the image shown in remarks).

Digital Full-Funnel Marketing

Ad Creative

Display, Paid Search, Video

Display, Video Retail Media

KOL Management

Others (E-mail, DOOH, etc.)

Content Creation & Management Content Creation & Management

Content Creation & Management

EC System Dev., SEO, Content Creation & Management, Inventory Optimization, Digital Ad Optimization, Fulfillment Support, Customer Service

Marketplace (e.g. Amazon) Retail Media (e.g. Walmart), etc Loyalty Program Management (Program Design, Activation, Operations, etc.) After Service Management (Service Design, Campaign Planning, Activation, Operation, etc.)

ADVERTISING

ADVERTISING

Digital Advertising

As described in the explanation of Digital Fullfunnel marketing, Digital Advertising is one of the key business areas in Digital Full-funnel marketing (Please refer to the Digital Full-funnel Chart provided in Remarks).

Digital Advertising refers to the practice of promoting products, services, or brands using digital channels and technologies. It encompasses a wide range of online marketing tactics and platforms designed to reach target audiences across various digital devices, including computers, smartphones, tablets, and connected TVs.

Digital Advertising

Digital Advertising

3PAS (3rd Party Ad Serving)

In broad terms, 3PAS (Third-Party Ad Serving) refers to a service where advertisements are delivered to media outlets (such as publishers) without storing the ad delivery data directly on the media company’s server. Instead, thirdparty ad servers outside the media company’s infrastructure handle the ad delivery. In a narrower sense, 3PAS specifically refers to the ad server itself, which centrally manages ad delivery and performance measurement across multiple media outlets. It is used by advertisers/ agencies to integrate campaign management and measure overall effectiveness.

Dynamic Creative Optimization (DCO)

Dynamic Creative Optimization (DCO) is a technique used in digital advertising to personalize and optimize ad creative in real-time based on various data points such as user demographics, behavior, location, device, and more. It involves automatically generating and serving tailored advertising to individual users or audience segments to maximize engagement and conversion rates.

Dynamic Retargeting

Dynamic Retargeting is a retargeting technique that automatically generates and displays advertisements related to products or services to users who have previously visited specific product or service detail pages on a website, based on their browsing history, in order to encourage revisits and purchases.

PMP / Private Marketplace

PMP (Private Market Place) is a closed advertising trading marketplace that restricts the interaction between media companies and advertisers. It is also known as a private exchange. PMP aims to achieve both targeting and branding by programmatically purchasing high-quality premium media. In PMP, advertisers can access a select group of media outlets, ensuring greater control over where their ads appear and maintaining brand image. Unlike traditional real-time bidding (RTB) auctions, PMP provides a more reliable and brand-safe environment for ad placements.

Private Exchange

In a private marketplace limited to media companies and advertisers, transactions take place. While leveraging the convenience of ad exchanges, media companies ensure a stable unit price for ad inventory, and advertisers can secure premium ad inventory without risking damage to their brand image. There are three types: ① where media companies fix the unit price and transact on a reservation basis, ② where the unit price is fixed and transacted in real-time, and ③ where the unit price is not fixed and only specific advertisers transact in auctions.

SSP (Supply Side Platform)

SSP (Supply-Side Platform) is a system used by media companies to streamline the sale of ad inventory and maximize revenue. It allows media companies to set parameters such as ad space availability, pricing, and preferred advertiser industries. The SSP then centrally manages ad delivery across multiple DSPs (Demand-Side Platforms), ad networks, and ad exchanges. By comparing net ad rates, predicted ad network prices, and real-time bidding (RTB) bid prices, the SSP automatically selects and delivers the highest-priced ads.

Retail Media

Retail Media refers to advertising opportunities offered by retailers within their own online or physical stores. It involves brands paying for placement or promotion of their products or services directly within the retail environment, whether it’s on the retailer’s website, mobile app, or physical store.

Trading Desk

Digital Advertising

A trading desk is a specialized unit within an advertising agency, media buying agency, or trading desk company that is responsible for executing and managing programmatic advertising campaigns on behalf of advertisers or clients. They often handle a wide range of tasks beyond operational transactions, including planning and reporting.

Viewable Impression

A viewable impression is a metric used to measure whether an ad was actually seen by a human being, as opposed to being out of view or served due to automated activity. According to industry standards in the United States:

For static display ads, an impression is considered viewable if at least 50% of the ad’s area is continuously visible on the screen for one second. For video ads, an impression is viewable if at least 50% of the ad’s area is displayed, and there is continuous playback for at least two seconds (not necessarily from the beginning of the ad).

This metric helps advertisers quantify the percentage of ads that are truly viewed by real people, addressing inefficiencies associated with paying for impressions that go unseen or fraudulent practices that inflate impression counts. Keep in mind that viewable impressions provide a more accurate measure of actual user visibility compared to traditional impressions, which count even when ads are not fully visible

to users.

OWNED MEDIA

Owned Media

As described in the explanation of Digital Fullfunnel marketing, Owned Media is one of the key business areas in Digital Full-funnel marketing (Please refer to the Digital Full-funnel Chart provided in Remarks).

Owned Media refers to the digital assets and channels owned and operated by the company itself. The Company has control over the media and can use to promote their brand, products, or services (e.g. Company websites, Mobile App, Blogs, etc.) or

Owned Media

Owned Media

CMS (Content Management System)

A Content Management System (CMS) is a system that simplifies the management of content for websites. It packages essential features needed for website operation, allowing users to create, edit, organize, and publish digital content without requiring extensive technical knowledge or programming skills.

With a CMS, even non-technical users can edit web page content without touching HTML code. For instance, changing a single sentence on a page becomes hassle-free and measure overall effectiveness.

Social Commerce

Social commerce refers to the integration of social media platforms and online shopping experiences. It involves using social media networks, such as Facebook, Instagram, TikTok, or Pinterest, as a channel for selling products or services directly to consumers.

Essentially, it combines social interactions with e-commerce transactions, allowing users to discover, browse, and purchase products without leaving the social media platforms.

COMMERCE

COMMERCE

Commerce

As described in the explanation of Digital Full-funnel marketing, Commerce is one of the key business areas in Digital Full-funnel marketing (Please refer to the Digital Full-funnel Chart provided in Remarks).

Commerce encompasses the activities involved in buying, selling, and trading products or services, as well as the systems, processes, and technologies that facilitate these transactions. It includes digital shelf management across EC marketplaces, managing media to drive sales (advertising aspect), D2C (refer to page 38) and Offline-Merges Online (refer to page 38).

Management Others (E-mail, DOOH, etc.)

Commerce

D2C (Direct to Consumer)

A business model in which a manufacturer or other manufacturer sells products directly to consumers on their own e-commerce site. Since the late 2000s, it has developed mainly among American startups, and the number of companies hiring it has increased.

O2O (Online to Offline)

Sales promotion that combines web behavior (online) and actual behavior (offline). Marketing activities conducted on the Internet in order to influence user behavior on the web to purchases at physical stores, or to lead to purchases at physical stores.

OMO (Online Merged with Offline)

Refers to a marketing strategy or approach that integrates online and offline channels seamlessly to create a unified and cohesive customer experience. OMO aims to bridge the gap between the digital and physical worlds, leveraging the strengths of both channels to engage consumers at various touchpoints throughout their customer journey.

Storefront Management

Refers to the process of designing, organizing, and maintaining the digital interface through which customers interact with an online store. It involves creating an attractive and user-friendly storefront that effectively showcases products or services, facilitates easy navigation, and encourages conversions. Below are the key aspects of storefront management.

1) Design and Layout

2) Product Presentation

3) Navigation and Search

4) User Experience Optimization

5) Control Management (Access Control, Security Measures, Content Management, etc)

6) Inventory Management

7) Order Management

8) Customer Support

CRM

CRM (Customer Relationship Management)

As described in the explanation of Digital Fullfunnel marketing, CRM is one of the key business areas in Digital Full-funnel marketing (Please refer to the Digital Full-funnel Chart provided in Remarks).

CRM refers to the practices, strategies, and technologies that businesses use to manage and analyze interactions with current and potential customers throughout the customer lifecycle. The goal of CRM is to improve customer relationships, enhance customer satisfaction, and drive sales growth by understanding and meeting the needs of customers more effectively.

CRM is not only limited to strategy and project management, but also includes solution / application development, platform solution implementation & management (certificates/ reseller rights), operation (e.g. loyalty programs), and client communication (e.g. direct agent contact, e-mail, SMS, MMS, print, in-App notification).

DOOH, etc.)

After Service

After-service, also known as after-sales service or post-sales support, refers to the assistance and support provided to customers after they have purchased a product or service. It encompasses various activities aimed at ensuring customer satisfaction, resolving issues, and maintaining a positive relationship with customers even after the sale has been completed. After-service may include:

1) Customer Support

2) Warranty and repairs

3) Technical Support

4) Maintenance and servicing

5) Upgrades and updates

6) Feedback and improvement

Fulfillment Support

Refers to the process of managing and tracking the fulfillment of orders or services requested by customers. It involves coordinating various aspects such as order processing, inventory management, shipping, delivery, and customer service to ensure that customers receive the products or services they have purchased in a timely and satisfactory manner. In CRM systems, fulfillment support typically includes features such as order management, inventory tracking, shipping status updates, and customer communication tools. By integrating fulfillment support into CRM, businesses can streamline their operations, improve efficiency, and enhance customer satisfaction by providing a seamless experience from order placement to delivery.

Loyalty Program

A loyalty program is a marketing strategy designed to encourage customers to continue purchasing products or services from a particular business. These programs typically reward customers for their repeat business and encourage them to remain loyal to the brand. Loyalty programs often involve offering customers various incentives, rewards, or benefits bases on their purchasing behavior. These incentives can include discounts, coupons, free products or services, exclusive

access to events or promotions, and loyalty points that can be redeemed for rewards. The main goals of loyalty programs are to foster customer retention, increase customer lifetime value, and strengthen the relationship between the business and its customers. Additionally, loyalty programs can provide valuable data and insights into customer behavior, which businesses can use to further personalize their marketing efforts and improve customer satisfaction.

DMP

CDP

(Customer Data Platform)

DMP (Data Management Platform) &

As described in the explanation of Digital Full-funnel Marketing, CDP & DMP is one of the key business areas in Digital Full-funnel Marketing (please refer to the Digital Full-funnel Chart provided in Remarks).

CDP & DMP are data platform for collecting, managing, transforming and leveraging data for marketing purposes.

There are differences in the types of data stored and how it is used; for example, CDP mainly handles company’s 1st party data, while DMP (Public DMP) mainly handles 3rd party data.

Within DMP, there are two types, which are Private DMP and Public DMP. Private DMP is also known as CDP. Please refer to page 54 for further explanation.

CDP & DMP

SEO

Ad Creative

Display, Paid Search, Video Retail Media

Display, Video Retail Media

KOL Management

Others (E-mail, DOOH, etc.)

Content Creation & Management

Content Creation & Management

Others

EC System Dev., SEO, Content Creation & Management, Inventory Optimization, Digital Ad Optimization, Fulfillment Support, Customer Service Marketplace (e.g. Amazon)

Content Creation & Management

(e.g. Walmart), etc Loyalty Program Management (Program Design, Activation, Operations, etc.) After Service Management (Service Design, Campaign Planning, Activation, Operation, etc.)

CDP & DMP

CDP (Customer Data Platform)

CDP is a data platform for collecting, managing, transforming and leveraging all your customer data, regardless of source. Mainly stores 1st party data. Generally, a platform that manages customer data that each company has independently accumulated. Utilizes various data surrounding customers (consumers) as a whole, such as preferences and life logs, to realize consumer-centered marketing activities. Sometimes called a private DMP.

Public DMP

Public DMP (Third-Party DMP) is a data platform that aggregates and manages various external audience data, including demographic data, interests, preferences, and behavioral history on websites. Unlike private DMPs that focus on first-party data (data generated within an organization), public DMPs primarily handle thirdparty data. These anonymous customer data sets are collected from various sources and contribute to effective new customer acquisition. Public DMPs play a crucial role in digital advertising by providing insights into user behavior and enabling targeted marketing strategies.

07. DATA & ANALYSIS

Data & Analysis

Data refers to information collected from customer interactions such as website visits, social media engagement, customer inquiries, and more. Data can be quantitative or qualitative and it helps us understand our customer.

In the context of Digital Full-funnel Marketing, data plays a significant role in various aspects, including market analysis, audience segmentation, content personalization, A/B testing, retargeting, measurement, and more.

Analysis in marketing refers to the process of examining data to gain insights for building strategies or making decisions. It is important for enhancing strategy planning, decision making, and maximizing operational efficiencies.

Data & Analysis

Ad Creative

Display, Paid Search, Video

KOL Management

Others (E-mail, DOOH, etc.) SEO

Content Creation & Management

Content Creation & Management

Content Creation & Management

(e.g. Walmart), etc

Program Management (Program Design, Activation, Operations, etc.) After Service Management (Service Design, Campaign Planning, Activation, Operation, etc.)

1st Party Data

First-party data is data that is collected directly by an organization from its own interactions with customers or users. This data is owned and controlled by the organization.

Example: Customer transaction history, website analytics, CRM data, email subscriber lists, and social media engagement data collected by the organization.

2nd Party Data

Second-party data is first-party data that is shared or exchanged between two organizations, typically through a direct partnership or collaboration.

Example: A retailer sharing its customer data with a manufacturer in exchange for insights or analytics on product performance.

3rd Party Data

Third-party data is data that is collected by external sources, such as data brokers or other organizations, and then sold or licensed to other parties for marketing or analytics purposes.

Example: Demographic data, purchase intent data, or interest-based data purchased from data providers to enrich the purchaser company’s customer profiles or target audience segments.

0 Party Data

Zero-party data is data that is intentionally and proactively shared by the user or customer directly with the organization. It is explicitly provided by the user, often through surveys, preference centers, or interactive experiences.

Example: Preference data collected through surveys, user-generated content, or feedback forms where customers voluntarily provide information about their preferences, interests, and behaviors.

Advertising Identifier

Apple’s iOS provides an ‘Advertising Identifier (IDFA)’ and Google’s Android OS provides a ‘Google Advertising ID (AAID)’, unlike device IDs, users are provided with simple means of changing settings such as resetting the ID or opting out of targeted advertising. IDFA and AAID are common IDs between apps, but their use for purposes other than advertising is not permitted. They are resettable device identifiers that users can update at any time, and are sometimes referred to as RDID (Resettable Device Identifier).

Audience Expansion

A method to expand the number of users by extracting audiences who have not yet visited the website but have similar behavior to users who have visited the website, by statistically processing big data such as DMP and extracting them from the network.

AAID (ADID, GAID)

AAID stands for Android Advertising ID. It is a unique identifier associated with individual Android devices used for advertising and analytics purposes on the Android platform. The Android Advertising ID is provided by Google Play services and is intended to replace the use of other device identifiers such as the IMEI (International Mobile Equipment Identity) or Android ID, which are considered less privacy-friendly.

The Android Advertising ID allows advertisers and app developers to track user activity across different apps and websites for the

purpose of serving targeted advertisements, measuring ad performance, and analyzing user behavior. However, users have the ability to reset their Android Advertising ID or opt out of personalized advertising through the device settings, providing them with some control over how their data is used for advertising purposes. Additionally, developers are required to adhere to Google’s policies regarding the use of the Android Advertising ID, including obtaining user consent when collecting and using this identifier for advertising purposes.

Data

IDFA

IDFA stands for Identifier for Advertisers. It’s a unique identifier assigned to individual devices by Apple, primarily used for advertising and analytics purposes on iOS devices like iPhones and iPads. Similar to the Android Advertising ID (AAID) on Android devices, the IDFA allows advertisers and app developers to track user activity across different apps and websites for the purpose of serving targeted advertisements, measuring ad performance, and analyzing user behavior.

Customer ID (CID)

Customer ID is a unique identifier assigned to an individual customer within a business’s database or CRM (Customer Relationship Management) system. It is used to distinguish one customer from another and allows businesses to track and manage customer interactions, transactions, and preferences more effectively.

The Customer ID typically contains information that helps identify the customer, such as their name, contact information, account number, or a unique alphanumeric code generated by the business. It serves as a key reference point for storing and retrieving customer data, enabling businesses to provide personalized experiences, targeted marketing, and efficient customer service.

The IDFA is intended to provide a way for advertisers to identify and track users without revealing their personal information. However, users have the ability to opt out of personalized advertising through the device settings, which restricts access to the IDFA and prevents advertisers from tracking their activity across apps.

Data Aggregator

A data aggregator is a company or tool that collects and organizes data from various sources, often for the purpose of providing insights or analysis. In the context of digital marketing, data aggregators may collect data from multiple sources such as websites, social media platforms, and other online services to provide insights into consumer behavior and preferences. This information can then be used to inform marketing strategies and improve targeting and personalization.

Data Broker

A data broker, also known as an information broker or information reseller, is a company that collects, analyzes, and sells personal information about individuals to other companies or organizations. This information is often obtained from public records, online activity, and other sources, and can include details such as contact information, purchasing habits, and demographic data. Data brokers may use this information to create detailed profiles of individuals, which can then be used for targeted advertising, risk assessment, and other purposes. Experian is one example of data broker company in the US.

Data Clean Room (DCR)

Data Clean Room is an environment for data analysis, primarily developed by major platforms both domestically and internationally. In this environment, advertisers and advertising agencies can access various information, including advertising campaigns, under the strict management of the platform, enabling them to conduct highly flexible analysis. The analysis data is handled securely through encryption and anonymization, allowing compliance with regulations. Furthermore, advanced analysis becomes possible by integrating first-party data managed by advertisers. The specifics of service provision vary depending on the platform. This environment is sometimes abbreviated as DCR.

DWH (Data Warehouse)

A warehouse for storing data accumulated within the company. Characteristics include that data is stored in chronological order and that data is not updated or deleted. It is mainly used to organize data and use it with data analysis tools such as Business Intelligence (BI). In some cases, DWH situations are equipped with analysis functions, but when performing full-scale data analysis, it is recommended to link with a dedicated tool.

Hashing

The term refers to the process of replacing the original data with an irregular character string based on a specific calculation method. The algorithm used for hashing is called a hash function, and the random character string generated by the hash function is called a hash value. Unlike encryption, it is an irreversible transformation, so hashing is often used for data that does not need to be restored. It is also used in cryptographic assets and blockchain technology.

Opt-out, Opt-in

The term used to refer to mechanisms and methods for acquiring and using personal information based on the user’s intentions. Optin: An act in which the user expresses consent each time they receive information or their personal information is used. Opt-out: An act in which the user expresses consent each time the service provider receives or uses their personal information.

Offline Purchase Data

Offline purchase data refers to information collected from transactions that occur outside of online channels, such as brick-and-mortar retail stores, physical storefronts, or other offline sales channels. This data includes details about the products or services purchased, the transaction amount, payment method, date and time of purchase, and sometimes additional information such as customer demographics.

Offline purchase data is typically gathered through point-of-sale (POS) systems, cash registers, or other in-store transaction processing systems. It provides valuable insights into consumer behavior and purchasing patterns in physical retail environments.

Online Purchase Data

Online purchase data refers to information collected from transactions conducted over the internet. It includes data related to the products or services purchased, the transaction amount, payment method, date and time of purchase, shipping details, and sometimes additional information such as customer demographics or browsing behavior.

Online purchase data is valuable for businesses and marketers as it provides insights into consumer behavior, preferences, and trends in online shopping. By analyzing this data, businesses can better understand their

customers, personalize marketing messages, optimize pricing strategies, improve product offerings, and enhance the overall online shopping experience.

Additionally, online purchase data can be used for various purposes such as targeted advertising, customer segmentation, loyalty program management, inventory management, fraud detection, and market research. However, it’s important for businesses to handle online purchase data ethically and ensure compliance with data privacy regulations to protect customer privacy and maintain trust.

PII Data (Personally Identifiable Information)

Refers to any data that can be used to identify a specific individual. PII data typically includes personal details such as below (differ among countries).

1) Name

2) Social Security Number

3) Date of Birth

4) Address

5) Phone Number

6) Email Address

7) Driver’s License Number

8) Passport Number

9) Financial Information (e.g. bank account, credit card number)

10) Biometric Data (e.g. fingerprints, facial recognition data)customer privacy and maintain trust.

Analysis

Attribution Analysis

Attribution analysis is one of the analytical methods used to measure marketing effectiveness. Rather than evaluating only the touchpoints directly linked to outcomes when measuring the contribution to marketing success, attribution analysis evaluates the contribution of various advertising channels, media, exhibitions, and other factors that customers pass through before reaching those outcomes.

The results are then used to optimize budget allocation. Attribution management refers to reallocating marketing budgets and resources based on the contribution levels identified through attribution analysis, with the aim of maximizing marketing results.

ACKNOWLEDGE MENTS

ACKNOWLEDGE-

Thank you for your interest in our Lexicon. We’d like to emphasize that our intention is not to unilaterally deliver our interpretations and definitions of terms.

Market conditions are continually evolving in the dynamic realm of digital marketing. The same terms may be understood differently based on individual perspective or specific market contexts. We believe it is important to recognize and identify these differences to maximize synergy through collaboration.

If you have any questions or comments, please reach out to your HDY contact. If HDY is new to you, please email us: lexicon@hakuhodody-holdings.co.jp

Learn more at:

https://www.hakuhodody-holdings.co.jp/english/ https://www.hakuhodo-global.com/ https://kyu.com/