Target loves to advertise on television. A few years ago, Target was spending more than 50% of its $US1 billion+ marketing budget there. Less than 5% of its budget was going towards digital ad placements.
But now Target has a new advertising darling: Facebook.
Target has worked closely with Facebook for the last few years. It’s built up a fan page with 23 million users.
Last year, during its data breach, Target was able to call Facebook to help manage its PR crisis. And this year, Target spent a lot of money building an app with Facebook’s engineers and product managers, called “Cartwheel.” The unique partnership yielded what Target says will soon be a new billion-dollar business for it. Cartwheel is a coupon app that has earned 11 million downloads thanks to Facebook’s help pushing the app on its platform.
“We started working as a team on a standalone app. Facebook really pushed us here [to make it better],” Target’s VP of PR and social media, Dustee Jenkins, tells Business Insider. “We worked with a lot of people there, from engineers to the innovation team, and we launched in beta.”
Jenkins says Target has become reliant on Facebook because of its scale (1 billion+ monthly users) and unique targeting abilities (like the ability to show a wedding registry promotion to a user who changes his or her status on Facebook to “engaged”).
“If you asked me to rank [digital ad platforms] in order of priority, Facebook would be at the very top,” Jenkins says.
Facebook isn’t the only digital property getting Target’s ad dollars. Buzzfeed, Twitter, Pinterest and Snapchat also get some of Target’s business. Target is also a big fan of Instagram ads, even though the platform doesn’t accept many campaigns. Target uses a tool, Curalate, which offers a “like to buy” feature on images.
At Business Insider’s Ignition 2014 conference, Business Insider asked Jenkins which she’d rather give up: Facebook advertising or television advertising?
Jenkins didn’t want to choose. The decision was too tough. “Can I give up billboards instead?” she asked.
Ultimately, Jenkins says she’d still rather give up Facebook advertising than TV. But she acknowledged that it was a surprisingly tough decision to make.
Target is pouring 50% more of its advertising spend this holiday season into digital ads. Jenkins declined to say how much of that budget would be spent on Facebook, but you can assume it’s the vast majority.