Target’s ad business had a good year, but can it become a retail media powerhouse?

By the looks of Target’s latest earnings call, its ad business continues to be a bright spot for the retailer. Last year, Target’s ad business raked in $649 million in revenue, up 25% from the $522 million it pulled in the year prior.

But for all its growth, Target is the David to the Goliaths of Walmart and Amazon, whose ad businesses brought in $4.4 billion and $50 billion in 2024, respectively. But even if Target is a long shot from hitting the bullseye to become a retail media power player, buyers see potential thanks to the retailer’s new self-service and second-price auction ad offerings.

For the first few months of 2025, Target has been caught in a media frenzy due to its moves involving diversity, equity and inclusion policies and subsequent boycotting, on top of missing its revenue expectations last November. Media buyers and commerce executives say they don’t expect to put a dent in the retailer’s audience data, making it unlikely to impact its ad business — at least for now.

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