Target Corporation (NYSE:TGT) is attempting a new social media campaign that the company hopes will drive customers off of the internet and into the company’s brick and mortar retail stores. The service relies on integration with Facebook Inc (NASDAQ:FB) accounts and will offer discounts to users who sign up for the service.
The service, which Target Corporation (NYSE:TGT) is calling Cartwheel, will be launched in public beta next week and it may represent a way for brick and mortar retailers to get customers through their doors despite tough competition. The launch could also be a boon to Facebook Inc (NASDAQ:FB). If successful the model could see more ad dollars, and higher margins, for the company.
Traditional retailers are finding it extremely difficult to compete with the ease and low cost of shopping online. Though the online sales tax currently making its way through the legislative process will remove a certain amount of price discrepancy, it may still be very difficult to get customers to buy the things they want in stores.
With Cartwheel, users sign up with their Facebook Inc (NASDAQ:FB) account and they get deals from Target advertised to them on the social network’s multiple advertising platforms. The offers are only redeemable in actual retail locations in the US stores of Target Corporation (NYSE:TGT).
Those signed up to Cartwheel will be able to earn more offers by getting their Facebook Inc (NASDAQ:FB) friends to sign up to offers. The service seems well designed and functional, but whether or not it will actually manage to drive customers to retail locations can only be ascertained through testing. Facebook Inc (NASDAQ:FB) is a useful advertising platform, but it may not be quite persuasive enough to make people go outside.
Facebook Inc (NASDAQ:FB) has been making great headway toward its monetization goals in recent months, and it has taken a huge amount of innovation for the company to get there. Innovation means dollars invested, and that means higher costs. If firms like Target Corporation (NYSE:TGT) are willing to do that investing for them, Facebook Inc (NASDAQ:FB) should welcome moves with open arms.
A successful campaign is an expensive one on Facebook Inc (NASDAQ:FB). If an advertising strategy is more effective and engaging than others, it is likely to cost more per user click. Target Corporation (NYSE:TGT) may be onto something with Cartwheel. If it is, Facebook Inc (NASDAQ:FB) investors should be happy.
