Take Charge of Education/USA Target’s Guest Card credit card is an important source of revenue for Dayton Hudson Corp., especially since archrivals Kmart and Wal-Mart have more stores, more customers, and much larger budgets to promote their proprietary cards. In the summer of 1997, therefore, it was crucial for Target to stay competitive and to 1/2nd a program that would build its Guest Card membership.
While considering how to achieve these goals, Target was also preparing to make its yearly donation to a charity organization. The company had been generous with its donations in the past, but felt that its recent contributions had become more and more unfocused. Target saw the importance to concentrate on charity programs and initiatives that would meet the needs of its primary constituency – families with school-aged children.
The growing mass merchandise chain found the ideal way to meet both of its objectives, at the same time solving a niggling problem among its family consumer base – fundraising for schools with dwindling budgets.
Target got together with Minneapolis-based promotion agency OptionOne to marshal its community gift dollars under the umbrella of Take Charge of Education, a multifaceted program wrapped around teacher and student scholarships, art grants, environmental education, volunteer programs, and fundraising activities. Research with parents and teachers had shown that a leading concern with them was finding adequate funding for expanded educational activities.
Schools received one percent of each dollar spent when card holders charged their purchases. Schools that signed up immediately became eligible to receive donations, and received ongoing information from Target, such as school-year calendars with additional fundraising ideas. The schools were asked to designate coordinators responsible for talking up the program with parents and grandparents. Target management in each store market provided grassroots activities, and the company used TV spots, in-store signage, direct mail, and telemarketing efforts to support the program.
Take Charge of Education was a win-win-win promotion: Schools got money, parents helped their kids get access to improved and expanded educational programs and services, and Target used a worthy cause to help boost store sales. More than 78,000 of the 115,000 schools in Targets marketing areas signed up (a 68 percent penetration rate) in the first year, and Guest Card membership grew by more than 20 percent. What’s more, the spend rate on the new card was four times higher than average, and credit card users visited Target stores twice as often. The program was renewed for 1998.