As brands continue to align to the new normal of online commerce, one of the new challenges they face is how to approach the myriad of online retailers that have become vitally important to their overall success.
While Amazon Advertising is still the biggest driver of Retail Media—now the third biggest digital channel in the U.S.—the opportunity offered by the other players in the space has become significant. Whether it’s omnichannel retailers like Walmart.com or delivery services like Instacart or GoPuff, brands who sell through these marketplaces know that a single product & promotion strategy across all of them isn’t the right approach.
Each of these companies has a unique core audience and plays a different role in the lives of consumers. The right framework appears to be a bespoke strategy for each commerce partner, but the meteoric acceleration of digital buying brought on by the COVID-19 pandemic has simply shifted the market too quickly to react accordingly.
One of the most important omnichannel retailers that brands can’t ignore is Target which grew ecommerce sales by 143.9% in 2020 versus 2019. It’s nearing $20 billion this year—to put that into perspective, Target generated only $4 billion in ecommerce sales just a handful of years ago (2017).
So, how should companies consider Target in their online commerce strategy?
In today’s post, we speak to Brian Weber, from the Minneapolis-based commerce agency, The Stable, to better understand how brands might best leverage Target’s massive online [and offline] presence.
Five Questions with The Stable’s Brian Weber
Brian Weber knows Target, especially after spending 17 years in various roles from Senior Buyer to Director of Loyalty for Cartwheel. He’s since moved on to work at The Stable as the Director of Digital Strategy.
The Stable is a fully integrated commerce agency that helps consumer brands activate and sell product across all channels of commerce. They “takes brands to the next level” by leveraging a full suite of omnichannel capabilities including retail representation, eCommerce services, media campaigns & optimization, brand/product development, and analytics & insights to generate revenue for clients across brick and mortar, eCommerce and Direct to Consumer (DTC) channels.
What is the benefit to clients to have The Stable’s deep bench of expertise at the retailer level?
The Stable is uniquely positioned in that we cover the major retailers and have deep expertise in each of them. Our retail and media teams have team members who worked at Target, Amazon, Walmart, and even Skai!
We use this expertise to not just optimize a digital vehicle or KPI, but to integrate the digital strategy into the brands’ total retailer strategy. Each of our retailer teams understands the nuances of the retailer, knowing which tactics and strategies work best.
How should retail marketers think about Target differently from other retailers in terms of the digital opportunity?
Unlike Amazon or Walmart.com, Target doesn’t have an open marketplace, so the assortment is curated by buyers with a focus on what’s best for guests while driving sales and profit. The main self-service tool is Target Product Ads and this is where brands can really control their own destiny by managing their paid search programs.
One big difference in Target’s approach to paid search is that it does not allow for competitive keyword bidding. It wants to give guests more of what they love, and not have guests feel like they’re being sold to when searching on Target.com. Target also has an amazing loyalty program, Target Circle, that allows brands a way to serve up digital coupons to millions of guests.
What is the most frequently asked question you get about Target and how do you answer it?
“I have $1 to spend on digital…where should I spend it?”
I equate this question to walking up to a stranger and asking them what I should buy for dinner. They can give me a broad answer that might be ok, but without knowing me, my budget, my diet, and what I really want—usually pizza—they really can’t give me a good answer. At The Stable, we always start with priorities, goals & objectives for the brands and use those to determine where to invest digital marketing budgets.
Every brand is different and deserves customized advice and planning.
The digital landscape is a bit more of a level playing field. How can smaller clients play best with the big guys and how should big guys be thinking to combat scrappier challengers?
It’s all about making your content and budget work as hard as possible for you.
For the smaller brands, investment levels will be a larger portion of sales, and it’s important to build that into your P&L. When we work with smaller brands, we dig into all the data and metrics we can get our hands on to pull out insights that showcase the brands’ reason for being. Target doesn’t want a brand that covers the same segment/demographic/attribute/etc that they already have—they are looking for brands that bring something new to the assortment.
For the bigger brands, it’s about knowing the digital landscape and prioritizing where to defend & where to get aggressive. Even the biggest brands should be leveraging Target Product Ads to drive an increased share of voice and sales on Target.com. Also, many legacy brands forget to review and maintain their PDPs to continually improve SEO and conversion.
How can a retail marketer take their digital learnings and use that to expand their brand presence in-store?
Digital marketing provides a TON of data that can be used to identify or validate your brand’s reason for being in the assortment. Knowing engagement & conversion rates can showcase how guests interact with your brand. Information from A/B testing can showcase your brand’s ability to optimize and drive incrementality. And with paid search, you can pull insights around where guests are converting the most which can help carve out your distinct niche in the assortment.
Finally, when pitching for stores, it’s important to showcase how your brand will do more than just sit on the shelf, and will invest in ways to drive awareness and traffic.
Skai’s retail media marketing solutions help brands to win customers whenever, wherever they shop
Simplify retail media with advertising on every retailer that matters, find your optimal mix, and win big with full retail intelligence.
Leading brands & agencies rely on Skai for advanced optimization and cross-channel analytics to drive massive omnichannel growth. Unlike any other retail media platform, Skai is backed by robust, world-renowned retail media engineering and experts who know exactly how to advise and lead your ecommerce evolution in the digital era.
To learn more about how Skai can help you upgrade your commerce intelligence practice, please reach out today.