Interview with Tony Zito, CEO, Rakuten Marketing

On Marketing Technology

MTS: Tell us about your role and how you got here. What inspired you to be a part of an integrated marketing company?
My career with Rakuten Marketing began in 2012 when my display company, mediaFORGE, was acquired by Rakuten Marketing. Directly following the acquisition, I served as Chief Revenue Officer of Rakuten Marketing. In early 2015 I was appointed CEO, and it’s been an incredible ride as we’ve navigated our way through several acquisitions and integrations, evolving consumer trends and the accelerated pace of innovation that’s driving our industry.

I was very familiar with Rakuten and Linkshare prior to the mediaFORGE acquisition. It was clear that, as leaders in the industry, they understood the necessity of integrated marketing – both in the value it brings marketers and the improved experiences it can deliver to consumers. In my world, integrated marketing means that there’s transparency and communication happening across all channels, teams, technologies, etc. And from that transparency comes crucial insights that fuel more efficient spending and more effective touchpoints. To be a part of a company that can bring all of this to advertisers and marketers around the world is both exhilarating and challenging, but it’s definitely what makes me excited to go to work each day.

MTS: Given the changing dynamic of online engagement with customers, how do you see integrating marketing strategies evolving by 2020?
Recently, Rakuten Marketing Insights released a report highlighting Consumer’s Online Ad Sentiments, and the insights were quite astounding. Despite the innovation in ad tech over the last 20 years, a lot of consumers find ads interruptive and even associate online advertising with fake news. However, we also found that 81 percent of US consumers feel that advertising is OK when the content is useful and doesn’t interfere with their online experience. We can all use this knowledge to spur changes across the industry that will create genuine and beneficial engagements with customers, so by 2020 those negative feelings and damaging experiences will be far less. We’ve started our own campaign to Save the Web, calling for a dedication to use targeting and advertising practices that put the experience of the customer as the number one priority.

At the crux of bettering experiences is understanding what’s actually happening with your marketing strategies. Emerging platforms and media are changing consumer behaviors, so we have to not only keep up but stay one step ahead to ensure we’re properly measuring and understanding touchpoints. I hope that by 2020, multichannel attribution is the norm and that we as an industry have moved beyond simple last-click measurement. Truly successful integrated marketing can only happen when marketers have a holistic and transparent view of the consumer journey.

MTS: How does Rakuten Marketing extend the benefits of audience and product data to B2B marketers?
It seems like often times the studies and insights related to digital marketing are focused solely on B2C marketers and audiences. We haven’t forgotten that B2B audiences are people and consumers who, at the end of the day, are looking for something to solve a specific need or problem. To this point, we regularly release reports through our Rakuten Marketing Insights program that can be utilized for both B2B and B2C. Reports like our Brand Affinity Report, Facebook Measurement Divide and Consumer Online Ad Sentiments uncover insights around device adoption, product and catalog trends, social media usage, year-over-year performance changes and more.

Rakuten Marketing has been working on a major data initiative focused on audience data and this is now available for B2B and B2C marketers as a part of our Audience Acquisition solution. We utilize transactional data from in-market shoppers that includes global brands from verticals like retail, travel, electronics, and digital media.

MTS: What are the new avenues for affiliates considering the growing prominence of Influencer Marketing?
Affiliate marketing has always been about empowering influencers and content creators. The rise of social media and other new content platforms have created so many new opportunities for influencers to have a voice and unique ways for consumers to find and interact with brands and products. From a recent survey we conducted, we found that 57 percent of consumers follow an online blogger or a social influencer and 88 percent of those who follow an influencer have made a purchase the influencer recommended.

We’re seeing the wide-reaching impact of influencer marketing in our own affiliate network, including a 51 percent increase in sales year-over-year. We know that influencers have a large role in introducing and reaching new consumers. Our data shows that, of all the touchpoints tied to an influencer, 53 percent are the first touchpoint.  And they’re touchpoints that are driving traffic and interactions! Last year in Q4, 84 percent of the traffic driven by influencers was new visitors.

MTS: How do you see the definition of Personalization changing with cross-screen viewability and expanding audience segments?
We’re in a unique place right now in our industry. Consumers are expecting and demanding personalized, meaningful interactions with ads and brands – but in order to deliver on this, we must capture, analyze and use data across dozens of sources, and in a manner that keeps consumers and their personal data safe.  It’s with that data that we can precisely identify and target consumers as they move beyond the reach of cookies – switching between devices and platforms. We tackle this with our consumer graph, built with probabilistic and deterministic data and signals.

The expectation for personalized and relevant experiences doesn’t just sit with current customers of a brand. First time and introductory interactions between a brand and new audiences have to be completely on point. That old saying of one chance with a first impression absolutely applies in advertising. To find new audience segments, marketers need to use high quality, accurate consumer data as a base or a seed. We’ve seen awesome results with lookalike campaigns using proprietary data for the seed audience – it always comes back to the quality of data you’re using. And then once you reach the new audiences, the message/product/promotion being used must be based in actual data. Many of our advertisers leverage product or message insights from other channels or campaigns with existing customers to inform their prospecting strategies.

MTS: What startups are you watching/keen on right now?
What I’m most excited about right now are start-ups that are effectively using AI technology to solve big challenges facing marketers, like improving the sophistication of cross-device personalization, developing more impactful product recommendations, getting better at predicting consumer behavior, avoiding fraud and brand safety risks, and measuring the impact of digital marketing strategies.

MTS: What tools does your marketing stack consist of in 2017?
The Rakuten Marketing business is built around our Integrated Marketing Solutions that encompass Affiliate, Display and Search. These solutions sit atop a platform that’s comprised of technologies, tools, and capabilities including:

• User Identification: Consumer Graph for cross-screen identification and targeting.
• Proprietary Technology: Cadence (attribution & insights), DSP, DCO, Bidder, Ad Server and Feed Management.
• Unique Data: Consumer Intent Data, Ad Interaction, Product Scoring
• Emerging Media Inventory: Social, Influencer, Video, and Audio

MTS: Could you tell us about a standout digital campaign? (Who was your target audience and how did you measure success?)
One campaign that stood out this year was for our retail client Cariloha. With the objective of driving engagement and retention with its increasing site traffic, Cariloha leveraged traditional and Facebook retargeting strategies to increase sales of its bamboo fabric products. Over the first seven months of the campaign, Cariloha saw a 42 percent increase in returning visitor traffic and a 50 percent increase in revenue from returning site visitors.
Cariloha was also exceptionally innovative with this campaign in their use of fractional attribution. By evaluating the influence of the campaign throughout consumers’ purchase journeys, Cariloha could see that its retargeting strategies influenced 54 percent of its sales, accounting for 68 percent of revenue. While the brand knew that its retargeting campaigns were driving sales, it didn’t become clear how much of its online revenue was being driven through retargeting until they started looking at attribution this way.

MTS: How do you prepare for an AI-centric world as a business leader?
At the heart of digital marketing is connecting consumers with products, services and experiences they want to buy. Artificial intelligence has revolutionized our ability to do that, and will continue to drive the innovation in the space. With the advancement of voice assistants, AI technology has shifted from operating primarily behind-the-scenes to being an in-home companion that takes orders, makes recommendations, plays games and even tells jokes. As consumers become more comfortable with their personal AI devices, they’ll increasingly rely on them for shopping and will be more receptive to the custom recommendations they make. At the same time, it will be harder for digital marketers to reach consumers directly, as their advertising messages will be filtered through consumers’ AI. This is something MarTech and AdTech companies will need to prepare for, as it will change the nature of how we reach and influence consumers through digital advertising.

One of the best ways to prepare for that future is to invest in better understanding the marketing that influences consumer behavior. While it’s easy to get caught up in the excitement of the technology itself and in using it in ways that are new and competitively different, it will be increasingly critical to consider the value it’s bringing to the consumer. If it’s not enhancing consumer shopping experiences and making it easier for them to connect with what they want to buy, it won’t pass the AI filter to reach to consumer. We will need to advance the level of sophistication with which we leverage data to understand consumers, so we can get the right ads in front of the right consumers, and maximize the influence and performance of digital marketing campaigns.

This Is How I Work

MTS: One word that best describes how you work.
Passionately.

MTS: What apps/software/tools can’t you live without?
Right now, the tools and apps I rely on most for day-to-day business operations are Domo and Box. I also spend lots of time on the road, so I am frequently using apps like Lyft, Open Table and Seamless Web. For more personal reasons, I love Vivino – I am always on the lookout for a great bottle of wine.

MTS: What’s your smartest work-related shortcut or productivity hack?
The smartest thing I’ve done as a business leader is to learn how to rely on the people around me. With roots as an entrepreneur, it can be difficult for me to give up control of aspects of the business – when you’re working with a team of 20, it’s possible to have a sense of what everyone is working on, and to become invested in every problem that needs to be solved. In a company the size of Rakuten Marketing, it is impossible for one person to be that involved in every aspect of the business. I have learned to surround myself with people who have strengths that complement mine, and I put my trust in them to tackle challenges and create opportunities for the business. Learning how to do this has given me a lot more space to focus on my own areas of strength, and the business is stronger because we have a whole team of outstanding leaders.

MTS: What are you currently reading? (What do you read, and how do you consume information?)
At the top of my reading list is Creative Change by Jennifer Mueller. It’s extremely important to me to nurture a culture of creativity, innovation and risk-taking. I want to be sure that, as a leader, I am primed not only to create opportunities for that thinking, but to recognize the potential of the ideas that come from it and to take action on the ideas that can drive the business forward.

MTS: What’s the best advice you’ve ever received?
The best advice I ever received is to stay attuned to the opportunities that the universe puts in front of you. A big part of that is being sure you never become too complacent about where you are and what you’ve achieved. Recognizing and capitalizing on opportunities is like a muscle that can be lost if it isn’t flexed.

MTS: Something you do better than others – the secret of your success?
One thing I’ve strived to do well as a business leader is to take opportunities to celebrate achievements and meaningful milestones, and to recognize people who are accomplishing great things, while at the same time, never getting too comfortable in success. No matter how well the business is doing, I challenge myself and my team to consider what opportunities are out there that we aren’t capitalizing on, and I empower those around me to pursue the ideas and opportunities that they believe will better our business.

MTS: Tag the one person in the industry whose answers to these questions you would love to read:
Jeff Green, CEO, The Trade Desk
Joe Zawadzki, CEO, MediaMath
Babak Hodjat, CEO, Sentient Technologies

MTS: Thank you Tony! That was fun and hope to see you back on MarTech Series soon.