XICA MARKETING SCIENCE LAB (hereinafter referred to as MS Lab) is a community that aims to explore "optimal decision-making" in marketing. A free event exclusively for members was held at the Tokyo venue on Thursday, November 2024, 11.

The event was divided into two parts: a "seminar" where cutting-edge information and success stories on data-driven marketing were shared, and a "lab" where practical knowledge was generated through two-way communication between the seminar speakers and participants. This article reports on some of the content of the seminar.

Speakers/panelist:

Nagumo Katsuaki (Nagumo Katsuaki

Toridoll Holdings Co., Ltd. Executive Officer and CMO And KANDOHead of Communications and Marugame Seimen Co., Ltd. Director Head of Marketing

Graduated from Waseda University Graduate School of Commerce with an MBA. Has served as marketing manager for various brands at B2C companies such as Konami Sports and SAZABY LEAGUE. Joined TORIDOLL Holdings in 2018. Has been in his current position since 2022. Starting with "emotion (KANDO)," he promotes "emotion-driven marketing" that continuously increases the probability of being selected from both the aspects of emotion and data science. With a focus on improving brand power and customer experience (CX), he is committed to innovating and expanding marketing that continues to grow business and corporate value, from innovation through new value creation.

Moderator

Yoshiaki Hirao

XICA Co., Ltd. Representative Director, President and CEO

Graduated from Keio University Faculty of Policy Management. After his father went bankrupt, he strongly wanted to "eliminate the hopeless sadness in the world." Discovering the potential of statistical analysis as a form of management support while at university, he founded XICA Co., Ltd. in February 2012. Based on statistics and economics, he has provided consulting to many major clients on improving marketing accuracy. With this experience as a background, he has served as product owner for the development of various tools at XICA.

table of contents

Over 3 million meals sold in the first three months! The reason why Marugame Seimen continues to win

"Marugame Udonuts" has sold over 3 million meals in the three months since its launch, making it the biggest hit product in the history of Marugame Seimen. How can the company continue to win by creating buzz with innovative ideas while maintaining a high-quality brand image?

For this event, we invited Katsuaki Nagumo, Executive Officer and CMO of Toridoll Holdings and Director and Head of Marketing at Marugame Seimen, to talk about the behind-the-scenes success of "Marugame Udonut" and the strategies and thinking behind the company's sustainable results.

Marugame Seimen's "emotion-driven marketing"

Marugame Seimen believes that KANDO (emotion) is the source of customer creativity, and places the utmost importance on creating emotion in all of the experiences and measures it offers. Even if it means making a profit, it will never make a decision to ignore emotion and pursue only efficiency.

Mr. Nagumo:"You can't create emotion from data. And emotion alone doesn't increase the probability (it's not reproducible). That's why I think we need marketing strategies and tactics that combine both data and emotion."

In other words, Marugame Seimen's emotion-driven marketing is a form of marketing that uses the creation of emotion (purpose) as the axis of decision-making, balances seemingly contradictory elements such as intuition and data science, and achieves sustainable growth with a high success rate.

Saikya's Hirao, who has worked alongside Marugame Seimen for four years, reflected on the company's marketing as follows:

Hirao:"Marugame Seimen has been facing changes in the restaurant market due to the COVID-19 pandemic, and has been reviewing its traditional marketing model, seeking to refine it by focusing not only on quantity but also on quality.

We started with MMM (Marketing Mix Modeling) to clarify the contribution of each measure to business results, but then we started analyzing awareness data to clarify the background and quality issues of why such results were obtained. We are now combining these two methods and conducting analysis with MMM as the hub."

By using MMM as a hub, it is possible to clarify the impact of attitude changes and measures on business results. In other words, it becomes possible to identify "attitude change indicators that should be boosted" and "measures that should be focused on."

For example, in analyzing awareness data, Marugame Seimen examined the key drivers that lead to business results. Using questionnaire survey data obtained after COVID-19, they conducted statistical analysis to determine the explanatory variables that influence the number of visits. As a result, they found that in the case of Marugame Seimen, "delicious udon" is the key driver, with "quality" being given more importance within that. They also dug deeper to identify the factors that drive these, and are developing branding and product promotions based on the results.

Looking back at Marugame Seimen's efforts last year (2023), while developing branding that put its noodle craftsmen and noodle factory at the forefront, it also developed product promotions that emphasized new experiences and excitement. These captured the images of "safe to eat" and "has something different from other stores," which were revealed in the analysis as important elements linked to the characteristic of "good quality," and as a result, it was found that this synergistically increased the intention to use the store.

The story behind the success of "Marugame Udonuts"

A concrete example of this success is the "Marugame Udon Natsu" launched in 2024. The aim was to go beyond the traditional image of udon shops and carve out a new market for snacks.

Mr. Nagumo:"We created an overall communication strategy by keeping in mind data science that increases the success rate, and adding the sensibility of, 'I want this kind of product/flavor!' and 'If we did this, it would be interesting! It would be new!'"

The USP (Unique Selling Proposition) of "Marugame Udonatsu" is as follows. It is centered on the key drivers that lead to the business results mentioned above.

• The uniqueness and innovation of "donuts" born from udon
• A unique "chewy texture" and authentic deliciousness beyond imagination
• All the products are handmade in our stores (safe, simple and nostalgic)

The company's product promotion strategy employs an integrated approach that effectively combines multiple media. It places particular emphasis on attracting initial customers, and even before the product's launch, it opened an experiential pop-up shop in Shibuya and held a free sampling event to create direct contact with customers. Through these efforts, it has succeeded in acquiring new customers, primarily from the younger generation. It also deployed a communication strategy that made use of a variety of media, including TV commercials, web advertising, and PR.

Of particular note is the use of UGC (user-generated content). The product promotion strategy, combined with the distinctive appearance and taste of the product, generated buzz on social media and led to its spread. This also demonstrates the success of the strategy of incorporating "topicality" and "shareable elements" into the product itself.

As a result of these measures, the product gained approximately 7 media exposure within the first seven days of its release, and exceeded 900 million servings in the first three months of its release. It became the biggest hit product in the history of Marugame Seimen, surpassing the "Marugame Shake Udon" released the previous year.

In this way, the key to the success of Marugame Udonatsu lies in a strong concept, exposure before its release, and maximizing UGC.

And in fact, behind this success was a data-driven initiative. From the results of analyzing the pre-buzz generated by new product launches that we had worked on with XICA in the past, we learned the following:

• The success of a campaign is proportional to the number of initial visitors.
• Pre-buzz can increase at least 25% of initial customer numbers
• Among pre-buzz articles, the number of article views and the amount of social chatter are strongly correlated with the number of initial visitors.

The analysis clarified the importance of the number of initial visitors, and which media to use, when, and how much to implement measures such as product releases and commercials. ​The results of this pre-buzz analysis were used to create targeted hits, which was a major factor in further improving results.

Marugame Seimen's unstoppable challenge -A vision for the future of management centered on emotion

Marugame Seimen's new challenges continue. In the future, they plan to focus on four areas: "EX (a system/structure that encourages internal motivation)," "CX (noodle factory space/ultra-handmade/ultra-fresh experience)," "Social Good (a brand/store that is rooted in the community and is committed to contributing to the community)," and "BRAND (a one-of-a-kind KANDO creative brand)."

Mr. Nagumo:"Rather than focusing on just one thing, I want to come up with ideas that balance all of these aspects. As a result, I want everyone to say, 'I love Marugame!' and 'I want to support you,' and I want to help the employees to naturally think, 'I love this restaurant,'" he said.

Currently, in addition to analyzing the MMM and awareness data and pre-buzz data introduced here, they are also working on building a "store performance model" (visualizing EX → CX → sales and profits) that analyzes the structure in which the happiness of working employees leads to the creation of moving experiences in the store and contributes to final sales and profits.

Mr. Nagumo:"I can visualize things in my head, but it's only with XICA's help that I can organize them and analyze them as a model."

A thorough breakdown of Nagumo's thinking! The key to continuing to win

In the second half of the seminar, Hirao asked Mr. Nagumo the following two questions:

Q1. How can one hone one's sensibilities?

 Mr. Nagumo:"I think it differs from person to person, but for me, the basis is a genuine interest in and affection for the subject. I also think it's important to consciously develop a sense of what moves you and what elements you find valuable while gaining real-life experiences."

Q2. What is important in interpreting the data?

Mr. Nagumo:"What's important is setting a hypothesis in advance and the process of verifying it. Particular attention should be paid to cases where the data differs from the hypothesis. I think you can gain insight by not overlooking those differences or anomalies and digging deeper to find out why the results were like that."

As a closing remark, Hirao reiterated the key points of the seminar.

He explained that the key to success is to keep the cycle of "hypothesis," "data," and "sensitivity" going, and that in doing so, it is necessary to be aware of three points: "① Maintain a certain level of accuracy," "② Trust the verification results and put them into action," and "③ Create an organizational culture that keeps the cycle going." He emphasized the importance of not "finishing the analysis" but of finding new points of discussion and "continuing the analysis."

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