[Special Interview] What is the ultimate digital marketing that Mr. Arima, who has been involved in Internet advertising for 20 years, aims for? Part 1

In July 2017, Rakuten Data Marketing, a joint venture between Rakuten and Dentsu, was established.

Rakuten, which boasts Japan’s largest amount of consumer behavior analysis data, and Dentsu, which has excellent mass media strategy building capabilities, have teamed up to provide comprehensive

digital marketing

solutions.

By optimizing and maximizing the effectiveness of corporate marketing activities, we are presenting a new way of

Internet advertising

.

The career of Makoto Arima, the company’s president and Rakuten vice president and chief revenue officer, is often described as “the history of Internet advertising in Japan.”

Joined Yahoo as its first employee in 1996. Mr. Arima, who has supported the development of Internet advertising in Japan for over 20 years, including later serving as CEO of Google, what is his goal with Rakuten Data Marketing?

In this first part of the interview, Mr. Arima will talk about some impressive episodes from his encounter with Internet advertising to the present day, including the evolution of Internet advertising.

Exposure to the potential of online advertising in the US led to participation in Yahoo!

Mr. Arima’s first encounter with Internet advertising dates back to 1995, when he was working at Recruit.

“In 1995, at the dawn of the Internet, I attended a conference called “Internet World” held in Boston.

I had attended other IT-related exhibitions several times, so I went there to gather technology-related information with the same feeling, but the atmosphere of the visitors was completely different. “I did.”

At the time, Mr. Arima was the sales manager of Recruit’s communications business, in charge of proposing the construction of information and communications networks to companies, but media was an unknown field. However, when he joined Internet World, he was able to see its potential.

“The participants at Internet World were having a heated discussion about the potential of the Internet as a medium.

Even though I had no experience with the media, I realized that it was completely different from the text-based computer communication that was mainstream at the time.

While watching their heated exchange, I thought, “In the near future, the Internet will definitely become a big medium!” ‘I had a gut feeling.’

Becoming a media means that there are opportunities for advertising business.

Mr. Arima returned from Boston with the desire to be involved in such work someday.

The next year, in 1996, when he was 39 years old, a headhunter came to him.

“SoftBank will establish a Japanese subsidiary of Yahoo in a joint venture with US Yahoo.

Would you like to be in charge of advertising sales as one of the founding members? That was the invitation.

I had witnessed the arrival of the internet age in Boston the previous year, so there was no reason to say no.”

Founded by Jerry Yang and David Philo, Yahoo was already becoming a symbol of the Internet industry with its combination of search engine and advertising businesses.

In addition, Softbank’s Masayoshi Son had become widely known within the industry as a pioneering IT executive in Japan.

“At the time, Recruit was full of work, but I persuaded my family that I would never have a chance like this again,” and I became Yahoo’s first employee, working on “Yahoo! JAPAN” on April 1, 1996. I was present at the start.”

Establishing Internet advertising in Japan during the Yahoo era

Yahoo! when it first started! JAPAN’s two strategic pillars were “expansion of services” and “advertisement sales.”

An important role in the latter advertising business was played by Cyber ​​Communications, an Internet advertising company established by SoftBank in July 1996 as a joint venture with Dentsu.

The company will leverage Dentsu’s know-how to sell Yahoo advertising and expand its scale.

The fact that giant companies such as Toyota Motor Corp. have understood Yahoo’s business model of providing free search and other services and generating revenue through advertising from an early stage and placed advertisements on it is one of the reasons why Japan’s largest advertising agency This can only be attributed to Mr. Son’s keen eye for partnering with Dentsu. In addition, Mr. Arima, who said, “I understand IT, but I didn’t know anything about advertising,” said that he learned everything about advertising from the company.

“While we conduct advertising sales, we have also increased our direct transactions with advertisers whose services are completed online, such as e-commerce sites, recruitment sites, online securities, and travel sites.The demand from these direct companies has increased. By growing bigger, Yahoo was able to survive the bursting of the dot-com bubble.”

Mr. Arima joined Yahoo as its first employee and served as director and managing director for three terms and six years, before retiring from the company in 2002.

I chose Rakuten as a place to take on a new challenge and continue to explore the future of Internet advertising.

After a period of preparation, in 2004 Mr. Arima founded I.A.M., a recruitment agency, with a joint investment with Hayao Nakayama, then chairman of Pasona.

Not only has he fulfilled his dream of becoming independent and starting his own business someday, but he has also put his business, which focuses on introducing talented people into the internet industry, on track. Looking back, Mr. Arima says, “I have made quite a contribution to the industry that I was deeply involved in.” A new turning point came in 2009. I was told that Google’s Japanese subsidiary was looking for an executive with strong sales skills.

“Seven years have passed since I left the Internet industry, and Google is Yahoo’s biggest rival.

When I asked Mr. Nakayama what I should do, he encouraged me and said, “There aren’t many people who can experience the executive level of both Yahoo and Google,” so I jumped into Google, leaving I Am in charge. Since then, Mr. Nakayama has remained my mentor.”

Mr. Arima’s four years of experience, from 2010, when he joined Google Inc. as Senior Managing Executive Officer and General Manager of Sales Division, to 2014, when he retired as Representative Director, is reflected in his book, “Gaps are Opportunities!” ” (published by Nikkei BP, 2014), so I won’t cover much of it here, but Google continues to innovate at the center of the IT industry, which is changing the world at dizzying speed. The surprises that come into contact with corporate culture are vividly described with a sense of reality that can only be achieved by being “involved”.

“Up until then, Google had played a major role in technology development, such as mobile-related search products, but they wanted to become more sales-oriented, so they approached me, who was formerly in charge of sales at Yahoo. I was able to see for myself how the IT revolution will change the world in the future.”

In the book, Mr. Arima explains the importance of the three elements of the IT revolution: “evolution of computers/devices,” “development of Internet services,” and “the era of big data – the fusion of IT and existing businesses,” with detailed concrete examples. He repeatedly states that the challenge of filling various “gaps” is the source of growth.

Rakuten became a new challenge for Mr. Arima.

I met Hiroshi Mikitani during my time at Yahoo.

“I knew Mikitani before Rakuten was founded in 1997. During the Google era, Rakuten was one of the largest advertisers, so when Eric Schmidt (former CEO) came to Japan, I accompanied him. I did.”

Mr. Mikitani, an old friend of mine, approached me as a business partner.

“Mikitani told me that the time has come when advertising revenue can be expected from e-commerce sites. He wanted to expand the scale, so he asked for some help. He also asked me to serve as president of the joint venture with Dentsu. Yahoo! It was a great pleasure to be reunited with Dentsu, the company where I learned the basics of advertising, and to be able to work together again.There are many unique and talented individuals, and I respect them. I was convinced that we could create something interesting by combining Rakuten’s big data based on over 100 million IDs with Dentsu’s mass media strategy know-how.”

Mr. Arima has been involved in Internet advertising for more than 20 years and has achieved results, but says, “We have not reached the future that I envisioned more than 20 years ago.” As someone who was familiar with the early days, he continues to explore the future of Internet advertising even in his current position.

“When you do marketing, the results are returned to you instantly as data. That is the biggest difference between Internet advertising and TV advertising. With Internet advertising, you can immediately obtain results and insights for your next action, and you can constantly improve your results. That’s why programmatic advertising is so popular. Campaign-based advertising, as exemplified by the top page of Yahoo! JAPAN, is well-known when it comes to internet advertising. What we have now is overwhelmingly programmatic advertising.”

Based on his experience with Internet advertising, Mr. Arima told us the following about the secret to success in Internet advertising.

“In Internet advertising, you can implement the PDCA cycle in an extremely short time, which improves advertising effectiveness by repeating Plan, Do, Check, and Action. “I think the winning formula is to quickly take action on things that are wrong and seamlessly connect online and offline.”

In the second part of the interview, we will talk in detail about Rakuten Data Marketing’s latest initiative, “RMP (Rakuten Marketing Platform).”

Mr. Makoto Arima

Rakuten, Inc. Executive Vice President, CRO Media & Sports Company President, Rakuten Data Marketing, Inc. Representative Director, Rakuten Adroll, Inc. Representative Director, Chairman

He joined Yahoo as its first employee in 1996, at the dawn of the Internet, and later served as CEO of Google, supporting the development of Internet advertising in Japan. In July 2017, he became Rakuten’s executive vice president and CRO (chief revenue officer). At the same time, he became president and representative director of Rakuten Data Marketing, a joint venture between Rakuten and Dentsu, which began operations in October of the same year.