42. Joseph Zito – the logic of Datalogix and Oracle

Paleo Ad Tech

Joseph started in mar-tech at Experian before joining Datalogix in 2012. Working for Eric Roza and based in New York, he was with DLX — as it is known in the industry — through many ups and downs on its way to a reported $1.1 billion acquisition by Oracle in 2014.

Post acquisition, Joseph worked with the Oracle Data Cloud team until 2019, when he left to join customer analytics startup Custora, itself acquired by Amperity later that year. Today, Joseph runs his own startup, {X}Form Coaching & Consulting, based in NYC.

As Joseph tells Marty in this colorful episode, Datalogix began life in 2002 as a direct mail cooperative called NextAction. Direct mail coops typically consist of retailers who pool their CRM files, based on catalogue and other data collected from customers; they then make that data available to non-competing marketers on a cost-per-lead (or CPM) basis. For example, a home decor retailer might contribute files of households with particular geo-demo-purchase characteristics; a shoe retailer could do the same; and so on. Contributors often gain insights into their audiences based on ID matches (e.g., name-address) and can get net new leads who match either their own audiences (‘lookalike’ targeting) or defined features (e.g., ‘luxury shoppers in Denver’).

All of this should sound very familiar by analogy to digital marketers, who often aren’t aware of the sophistication of direct marketing in real life.

The actual targeting and mailing is done by a third-party without the coop data user learning the actual names/addresses, unless they respond to the mailing. And any unique IDs are usually suppressed, so coop members aren’t giving up proprietary data. Coops differ in their members, modeling methods and transparency. (Regular listeners will remember our discussion with DoubleClick’s co-founder about the acquisition — and later sale — of Abacus, another direct-mail coop.)

In fact, Datalogix was spawned from a merger of a company called Data Logix, founded in Boston by a venture capitalist, and NextAction, which was actually founded by the former President and CFO of Abacus and a staff of ex-Abacusites, in 2002. Major competitors were Experian, i-Behavior and Abacus, which eventually ended up owned by Epsilon.

Roza joined NextAction in 2007 at a time when it required a reported personal infusion of funds. He proceeded to build a culture in Westminster, Colorado, that was loose on structure and tight on wellness. (A well-known Crossfitter and box owner, he would later become CEO of the fitness franchise.) Zito joined the company’s NYC office as a committed advocate of the DLX experience.

Joseph points out that there were a number of “existential moments” in the startup’s path. As it moved from offline to online solutions, Datalogix required a number of data partners to function. One set of partners provided a link between logins (e.g., emails) and third-party cookies — think large publishers. These partners powered an onboarding product, similar to and perhaps even predating LiveRamp’s. Another set of partners provided retail purchase data tied to personal identifiers (e.g., emails), often via loyalty programs. This latter set of data allowed Datalogix to offer its ‘killer app’ and ‘transformative product,’ an ability to offer both CRM-based online audiences and a closed-loop measurement facility. Partners dropping in and out unexpectedly furnished some of these fraught moments.

In 2012, Datalogix gained a valuable partnership with Facebook to track the offline impact of online ads and later expanded the model to Twitter and other large pubs. The arrangement was scrutinized at the time and later suspended by Facebook in 2018, as the company continued to sift through the fallout from Cambridge Analytica. Nonetheless, Datalogix’s ‘ROI product’ proved successful and at one point DLX claimed 80% of the top US advertisers and 7 of 8 of the top publishers as clients.

In 2014, inspired by BlueKai’s co-founder Omar Tawakol, Oracle acquired the company, making it a keystone of the company’s Oracle Data Cloud.

At the time of acquisition, the company’s revenues were about $125 million. Joseph explains that the company moved into Oracle’s offices in Colorado, but not before Oracle agreed to build a Crossfit gym on premises. Red tape expanded but the culture endured. Joseph moved from managing the Lumascape to the DMP migration from the Oracle Marketing Cloud to the ODC — a political and strategic struggle. Eventually, both Tawakol and Roza left, and Joseph moved back to his roots in mar-tech at Custora.

Datalogix continues to function as Oracle Advertising, part of the Oracle Advertising and CX suite.