Target Jumps on Mobile Incubator Trend with Launch of Retail Accelerator


This is not your grandfather’s retail environment.

In fact, with Target joining the likes of Nike, BMW and Mondelez in launching a mobile incubator/accelerator and funding developers to come up with apps that will take shopping into the future, it might seem more like your grandkids’. Target announced a contest earlier this month called “Co. Labs & Target Retail Accelerator,” that dangles a $75,000 prize to whoever develops the best new mobile experience for the company.

Target is looking for “transformative, technology-driven” ideas that should incorporate at least one of the company’s four priorities:[more]

Social: Helping users interact with Target and each other to make shopping easier and, of course, more fun.

In-store: Improving and extending customers’ in-store experiences and helping them prepare for their next visit.

Personalization: Tailoring the experience and promotional offers to each customer’s unique tastes.

Education: Helping students, teachers and schools be more successful.

Seven finalists will be chosen next month and each will receive $10,000 to develop their prototypes. After presenting their ideas to the company, a grand prize winner will be announced. They’ll receive the big check and work with the company to bring their idea to life.

This isn’t about coming up with the next “Where’s the beef?” or “Tastes great, less filling,” advertising campaign that a company can ride for the next year or two. It’s about developing an immediate, ongoing and intimate relationship with consumers through applications on their smartphones, on their computers and at the Target till.

Jeffrey Jones, the Minneapolis-based retail giant’s chief marketing officer, said in a company-released video that digital content is its overriding promotional focus.

“In the past, marketers would make campaigns, they would put them in the world, and they would wait to see what happened. In today’s world, it happens hourly. It happens daily. And this is a brand that has such enriched deep content that our guests want to hear from us on. So if we can create content and share content and allow our guests to speak on our behalf, that’s really beneficial for them to deepen their engagement and it helps us amplify our message as well,” he says.

Target is using QR codes and mobile gift cards with its mobile app to increase loyalty and value for their customers and hopefully make shopping there a whole lot easier and enjoyable. “Ultimately, to be able to engage a brand wherever and whenever you want is where we’re headed,” Jones says. 

He’s not kidding. It’s also easier than you might think as Target customers don’t even have to carry their gift cards with them in their wallets thanks to the “Mobile GiftCard” initiative. And older customers won’t have to have their tech-savvy kids—or grandkids—tag along with them, either. Any customer can save GiftCard information to a PIN-secure account at All they need is a mobile phone that can access the Internet and they’ll be able to retrieve GiftCard barcodes at the checkout. uThey can also access their GiftCards to add value at store registers, check their balances online and save multiple GiftCards to their account and label each one for easy reference.

Target says it’s the first major retailer with the ability to scan mobile barcodes in all of its nearly 1,750 stores across the U.S. (The company just opened the first three of what is expected to be more than 120 in Canada by the end of the year.) Customers can also check product availability, manage their gift registry lists, scan the weekly ad and receive text and e-mail messages about the latest deals.

In Target’s earnings conference call following its fourth quarter of 2012, CEO Gregg Steinhafel told analysts he was very pleased with sales in its digital channels as online and mobile sales grew faster than industry averages. The company’s mobile sales and traffic are growing at a triple-digit pace, albeit off a small base, he says.

“Our investments in the website and mobile technology drive guest engagement with Target, and lead them to shop more across all of our channels. For example, following the launch of free wireless in all of our stores in the fourth quarter, was, by far, the site most commonly accessed by guests while they were shopping in our stores. Our plans for 2013 reflect our ongoing commitment to investing in a robust multichannel experience for our guests,” he says.

Target’s move follows the lead of Lexus, PepsiCo and Nike, which launched the Nike+ Accelerator back in December. The company recently plucked 10 companies for a three-month, intensive development journey to create products and services that will service the Nike+ and NikeFuel platforms. Following the company’s strong earnings, Nike plans to invest in further development of the FuelBand, which apps from the accelerator will service.