Target Corporation

Author:Jonathan Kolstad, Judson Knight, Ed Dinger
Pages:1599-1606
 
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1000 Nicollet Mall

Minneapolis, Minnesota 55403

USA

Telephone: (612) 304-6073

Fax: (612) 696-3731

Web site: www.target.com

NEW YORKER MAGAZINE SPONSORSHIP CAMPAIGN
OVERVIEW

In a bold move designed to attract an upscale clientele and garner widespread media attention, the Target Corporation purchased all of the advertising space in the August 22, 2005, issue of the New Yorker magazine. Target had always aimed for a more affluent demographic than its main competitors, Wal-Mart and Kmart, but in grabbing the attention of the New Yorker's readership, Target was seeking to lure an even higher-end consumer to its stores.

The campaign, created by Peterson Milla Hooks, was limited to the single issue of the New Yorker and consisted of 21 different illustrations created by as many artists. The ad space alone cost in excess of $1 million. Each ad used only the colors black, red, and white, and each featured the Target bull's-eye logo incorporated into a New York scene or theme. The ads ranged from loose, hand-drawn sketches to computer-generated geometric cityscapes. One ad featured a low-angle view of a leather-clad female motorcycle rider in the foreground with a giant bull's-eye rising behind the Brooklyn Bridge in the background, while another depicted a crowd of martini-sipping gallery-goers crowded into a room whose paintings were pop art versions of the Target logo. Not a single line of text or image of a specific product appeared in any of the ads. Instead of selling its wares, Target was selling an urbane, artistic impression of itself to a sophisticated audience it had not reached quite so directly in previous campaigns.

The single greatest success of the campaign was its ability to generate media coverage and to create controversy far beyond the readership of the magazine itself. Almost every national newspaper covered the story of Target as the sole advertiser in the magazine—the first time in its history the magazine had been sponsored by one advertiser—and National Public Radio ran two spots about the phenomenon. And while the American Society of Magazine Editors issued a reprimand to the New Yorker for not following its guidelines for single-sponsor issues, this merely led to additional press coverage and sparked a debate in industry circles about the merits of such an undertaking.

HISTORICAL CONTEXT

Founded in 1962 as a subsidiary of the Dayton Company, Target quickly became the most profitable of the parent company's retail chains. From the beginning the idea behind Target stores was to appeal to customers on the basis of the style of its merchandise and the design of its stores rather than low prices alone. As Bryan Curtis wrote in the online magazine Slate, the founders decided that Target would

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HISTORICAL CONTEXT Photograph by Kelly A. Quin. Thomson Gale. "exude the mild pretension of a low-end department store rather than the folksiness of a high-end dime store."

By the mid-1980s Target executives were referring to the company's positioning in the marketplace as "upscale discount." Creating this market niche was a way to differentiate Target from its main rivals, Wal-Mart and Kmart, whose sole emphasis was on having the lowest prices in the industry. In keeping with this slightly upscale approach, Target stores were designed with brighter lighting, wider aisles, and more available checkout lines than the competition.

Additional reinforcement of the "discount luxury" concept came in 2000 when Target hired the noted architect and designer Michael Graves to create a line of exclusive household goods for its stores. Graves had previously won an industry award for a tea kettle he designed in 1985 for the Italian firm Alessi, which retailed for $140. The tea kettle he designed for Target, which subsequently became a top seller for the chain, bore a passing resemblance to his previous piece but sold for only $40.

The combination of national branding and upscale designer housewares propelled both Target's sales and its reputation to such heights that in 2000 the company that had founded it (by then Dayton-Hudson Corporation) formally changed its name to Target Corporation. Within a year the company had sold off its other, less-profitable retail divisions.

TARGET MARKET

For Target's "upscale chic" approach to translate into increased revenue, it needed to attract a similarly upscale clientele to its stores. Target had high consumer awareness and strong customer loyalty among lower- and middle-income shoppers, but what the company yearned for was to turn its "more-stylish-than-the-competition" image into a shopping reality for upper-income consumers. To that end, in 1997 Target began to advertise heavily in New York City, mainly through billboards and outdoor signage, even though at the time there were no Target stores in the city or the surrounding metropolitan area. The company was expanding its presence in the northeastern United States, however, and believed that building brand awareness well before the stores were actually open would pay off in the end. In addition, Target hoped to attract a more hip, urban, and wealthy group of customers to its stores, banking on the idea that once trendy New Yorkers were seen wearing Target's clothing lines or using its household goods this would up its cachet among other urbanites nationwide.

It was this that led Target to advertise in the New Yorker. Generally regarded as one of the most prestigious magazines in the United States, this weekly publication was filled with extraordinarily literate journalism mixed with topically relevant New York-themed articles and current events. (It should be noted, however, that despite the magazine's New York area bias, it had more subscribers in California than in New York State.) A casual glance through other issues in August 2005 revealed ads

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for Jaguar, NetJets, Chanel, Level vodka, BMW, Mercedes, Hartford mutual funds, and Rolex watches, among various high-end products. The average New Yorker reader was hardly a demographic match for the average Target shopper, which was exactly the point. It was among those consumers who could afford to purchase such high-end merchandise that Target hoped to position itself.

The monopolizing of advertising space in the New Yorker made Target's presence in the magazine almost impossible to ignore, but in order to appeal to the tastes and desires of the New Yorker readership the ads themselves did not hawk any particular product or service but instead reinforced Target's branded bull's-eye logo in a variety of subtle and creative ways. Through the Minneapolis-based agency Peterson Milla Hooks, 21 artists were hired to create the full- and partial-page ads for the magazine. No two were alike, and each artist had extraordinary creative license in illustrating the ads. The hope was that the ads, some drawn by the same artists whose work had appeared previously in the editorial portion of the magazine, would attract attention not because of their content but because of their look and style. In short, Target's tastefully creative ads were designed to impress a refined, rather than a bargain-hunting, consumer.

COMPETITION

In 2005 Target was the number-two discount retailer in the United States, behind Wal-Mart and with Kmart number three on the list. Target's overall strategy of emphasizing style and not just price had helped to propel it to the number-two spot, but Wal-Mart's size and ruthless determination to slash prices by every available means meant that Target could hardly hope to compete on price alone.

While Wal-Mart's advertising strategy simply reinforced its low-price approach, with ads and television spots literally showing "falling prices," Target chose to promote style and youthful attitude in its marketing efforts, in large part to differentiate itself from its rival. Thus, while Wal-Mart was Target's number one competitor, Target's strategy was not to lure shoppers away from Wal-Mart but rather to lure shoppers away from even higher-end stores than its own.

MARKETING...

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