Target consolidating media business with GroupM

Target has announced that it will consolidate its media buying and planning business under New York-based media agency GroupM.

The change is immediate and the Minneapolis-based company will begin transitioning the remaining business from Haworth Marketing + Media, also based in Minneapolis.

GroupM began working with Target in 2015 and will see a three-month transition period between the two agencies. The account will mainly be led by the New York office with additional support from San Francisco and Minneapolis.

“Target is one of America’s great brands and we are thrilled to broaden GroupM’s partnership with them,” said Rob Norman, chairman of GroupM North America. “Target has an unwavering commitment to improving their guests’ experience and we will focus all of our talent, tools and insights to help them win.”

According to their 2014 annual report, Target spent $1.6bn on advertising.

The company sees digital as key growth driver, with $1bn going to technology investment in its supply chain and inventory management systems, which, according to the company, will help maintain or grow its 40% annual growth rate in digital.

Casey Carl, chief strategy and innovation officer for Target noted in a Multichannel Marketing article that digital sales delivered a 50% increase in digital conversion in 2014 and sales grew three times faster than the industry average. Mobile accounted for the most explosive growth, with 98 per cent of Target customers shopping digitally, a majority on mobile.

“Last year mobile traffic grew 44% and conversions shot up 69 per cent,” said Carl.

Additionally, Target increased their social media marketing spend in the coveted holiday season, with a 30 per cent budget increase centered around “The Holiday Odyssey,” fronted by actor Neil Patrick Harris. The multichannel campaign targeted shoppers on Facebook, Instagram, Snapchat and Pinterest and accounted for roughly 12 per cent of its media spending at that time.

For its part, according to reports, Haworth has been in talks with Walmart over taking over its media account. GroupM has a 49 per cent stake in Haworth and the Bentonville, Ark.-based mega-retailer hired former Target executive Michael Francis as a consultant late last year. Walmart is working with Publicis Groupe’s Mediavest through the end of its fiscal year, ending January 31, 2017, but pulled its media account from them and has yet to indicate where the account may land.

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