Why Target sat out the Grammys
There was one advertiser noticeably absent from Sunday's Grammy Awards: Target. After spending heavily on the February event in recent years with a surprise concert and live music videos, the retailer sat this year out.
"Music has always been and continues to be an important part of Target's brand," says Target spokesman Joshua Thomas, noting that the company is proud of its Grammys work. "An activation during the Grammys did not align with our plans this year," he adds.
Last year, the Minneapolis-based brand was, along with Ford, the largest advertiser in the event, which attracted some 19.8 million viewers, according to Nielsen. Target invested $9.2 million in advertising for the 2018 awards, according to Kantar Media.
Georgia Meyer, an analyst of marketing and media brands with data company MIDia Research, says that "the value that big ticket TV ad spots bring to brands is undergoing change." She adds that such live events are some of the "costliest" to create ads for, even while the audience of the Grammys, for example, is shrinking.
Target's Grammys absence, which was noticed by many viewers who have gotten used to the retailer's splashy activations in recent years, comes on the heels of a strong holiday season. Unlike many of its competitors, Target had a very merry Christmas with same-store sales for the period up 5.7 percent.
Target marketing executives have often spoken about the importance of music as a way to build customer engagement. The brand often releases exclusive albums with artists such as Adele and Sia. The latter accompanied Target's 2018 holiday campaign with an exclusive track.
In 2015, Target began doubling down on the annual Grammy awards—it combined eight 30-second media buys into a four-minute segment featuring a concert by the band Imagine Dragons. More recent years included a live music video performance from Gwen Stefani that experts estimate cost around $12 million. Last year, Target sponsored another live TV spot of "The Middle" with Zedd, Maren Morris and Grey for the 60th anniversary of the Grammys. At the time, Executive VP and Chief Marketing and Digital Officer Rick Gomez wrote that, "Music has always been a powerful way we connect with our guests, and this was another great opportunity to bring them more music and access to their favorite artists."
In addition, Target, which has some 1,800 U.S. locations, has also been switching up its agency roster. In previous years, Deutsch LA did some Grammys work, though Mother helped to create last year's activation. Target recently parted ways with Deutsch; the brand now works with agencies including Mother, Partners & Spade and Chandelier.
While Target's marketing budget is up this year, according to Thomas, the company is staying flexible by focusing on a variety of other marketing. Target has a growing stable of in-house brands, such as kidswear label Cat & Jack and home brand Project 62. Such owned labels are often highlighted in its advertising, as are fulfillment services such as picking up orders in parking lots. Over the holidays, Target abandoned its usual storyline campaign approach in favor of a more flexible format of high-energy ads able to stand on their own. The chain spent $382.6 million on measured media in the U.S. in the first 11 months of 2018, according to Kantar Media; in all of 2017, the retailer spent $461.1 million.
Meyer says there may be more value in focusing on social media marketing.
For some brands, "the wiser choice is to steer clear of the noise, double down on existing channels where they can own the messaging and continue to develop their purchase [call to actions] on social media," she says.