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By Alexandra Bruell
Target Corp. is in talks to buy retail advertising firm Triad Retail Media from WPP PLC, as the retailer seeks to boost its digital advertising business, according to people familiar with the matter.
Triad sells ad space on retail websites and other digital properties. It also helps brands create digital ad campaigns.
The talks are preliminary and could break down, according to the people.
WPP's digital ad-buying group Xaxis acquired Triad from private-equity firm Rockbridge Growth Equity LLC in 2016 for roughly $300 million, in an effort to capitalize on retailers' growing ad businesses.
Retailers such as Walmart Inc. and Target are increasingly selling ad space to brands, using data and insights to reach consumers shopping online. Those companies are trying to mirror Amazon.com Inc., which has become a big seller of ad space. The e-commerce juggernaut is the third largest online ad seller in the U.S. behind Alphabet Inc.'s Google and Facebook Inc. Its U.S. ad business is expected to grow more than 50% this year to $11.3 billion, according to eMarketer.
Target recently held its own event during the NewFronts, an annual series of pitches to ad buyers that promote digital ad offerings for brands. The presentations typically come from online publishers.
"Year over year, it's been a source of profitable growth for Target," the company said of its ad business in early May, when it rebranded its Target Media Network as Roundel. Roundel services include using data to place ads on Target and other sites like Pinterest and PopSugar. Nearly 1,000 marketers including Walt Disney Co., Mastercard Inc. and Unilever PLC have advertised using Target, the company said then.
Target, one of WPP's large media-buying clients, would likely use Triad's talent and system to expand its ad-sales efforts.
Walmart recently announced plans to bring its digital advertising business in-house and wind down its relationship with Triad. Walmart was one of Triad's biggest clients.
Walmart, like Target, is investing in its advertising business. Walmart is bringing its in-store and digital ad teams closer together and using its data on shoppers to help sell inventory across platforms, including on its video-streaming service Vudu. Walmart is also planning to host an event later this month to pitch its marketing opportunities to brands, according to Reuters.
WPP has been doing its own reorganization under Chief Executive Officer Mark Read, meanwhile, in an effort to simplify its operations. The company late last year said it was looking to sell a majority stake of market-research unit Kantar Group. It also merged several agencies, creating new agency brands, including Wunderman Thompson and &R.
--VMLY--Suzanne Vranica contributed to this article.
Write to Alexandra Bruell at email@example.com
(END) Dow Jones Newswires
May 23, 2019 15:53 ET (19:53 GMT)
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