Minneapolis-based Target has reduced the size of its agency roster by one, ending a six-plus year relationship with Deutsch.
“I can confirm that Target is no longer working with Deutsch LA. We are proud of the work we’ve done together,” said a client representative. An agency spokesperson also confirmed that the partnership has come to an end.
Client representatives told agency leadership about the decision on Friday, and Deutsch staff were alerted this afternoon, according to our sources.
“Target has a strong roster of creative partners, including Mother, Partners & Spade, Chandelier and our internal agency, Target Creative,” the client rep continued. “As our business needs and the industry continue to evolve, so will our roster.”
When asked to clarify, the Target spokesperson noted that the scope of work for both Mother and Partners & Spade will increase moving forward—and that its longtime relationship with hometown agency Periscope won’t change.
Spokespeople for all agencies except Deutsch deferred to the client.
The IPG network first won a piece of the Target business back in mid-2012 along with 72andSunny; Wieden + Kennedy had previously held the account for three years after becoming the client’s first-ever creative AOR without a review. As we understand it, Deutsch and 72, like all of Target’s other post-W+K agencies, always worked on a per-project basis.
Target and 72andSunny parted ways in early 2017 after the latter won global creative duties for eBay. According to a source close to the business, this split stemmed from a disagreement between client and agency about whether that win constituted a true conflict.
Since winning the account, Deutsch has created a number of big campaigns, including those starring Gwen Stefani and Imagine Dragons in addition to the all-important holiday and back to school efforts. The most recent such spot is this one from Thanksgiving, which was produced in collaboration with Target Creative, according to AdAge.
Sia handled the music.
This campaign was indicative of Target Creative taking on a larger role in the brand’s marketing efforts.
Many retailers are still trying to figure out which agency model fits amid declining revenues and marketing budgets across the industry. After this story was originally published, the Target representative noted that sales have risen in multiple quarters and that the chain does not plan to cut its overall marketing spend, though company shares fell in late 2018 after third quarter performance totals missed expectations.
In-house chief creative officer and Wieden + Kennedy veteran Todd Waterbury is also working to refine the internal model along with CMO Rick Gomez, who joined the company in 2013 and was appointed to the chief marketing role in early 2017. According to our source, Target Creative has handled more work in recent months as the chain increasingly focuses on launching and refreshing its own brands.
Target’s most recent evolution came today in the form of an announcement that all locations will soon accept Apple, Samsung and Google Pay.
Despite these challenges, same-store sales were up by 5.7 percent over the holidays. We’re also told the client recently provided up to $10 million in annual revenues for its top creative agency partners.
Kantar Media has Target spending $518 million on paid media in 2017 and $285 million during the first 9 months of 2018, a number almost identical to the total for that period the previous year.