Most discussions of artificial intelligence in advertising and media circles still largely revolve around how to use the technology to generate actual growth, as opposed to achieving some level of efficiency. Target’s Roundel believes it can do both with its Precision Plus program. Billed as Roundel’s AI-based performance engine, Roundel uses it to optimize audience targeting across its 130 million loyalty customers, delivering significant performance improvements through real-time signal analysis rather than traditional channel-driven approaches.
“We are seeing a huge increase in conversion or click-through rates. We are seeing a 50% decrease in CPMs from an awareness standpoint and increase in ROAS just by utilizing our Precision Plus tool to have those optimizations in real time through AI,” Jenny Holleran, vp, for Roundel, told Beet.TV contributor David Kaplan.
The $2 billion network has evolved from five employees in 2007 to solution-based brand partnerships that span awareness, consideration, and conversion rather than platform-specific executions.
Signal diversity beyond transactions
Roundel analyzes transaction data, behavioral patterns, digital engagement, and in-store interactions to create comprehensive audience understanding that extends beyond purchase history alone.
“The most obvious are transaction signals. So understanding what is someone buying. Then actually thinking about behavioral signals. So where are they buying?” Holleran said. “Then how they’re engaging. So are they interacting with social? Are they interacting through search? How are they starting that digital journey? How are they engaging in store?”
This multi-signal approach provides the foundation for precision media that delivers appropriate messaging at optimal timing to relevant consumers.
Incrementality requires multiple metrics
Moving beyond impression-based measurement toward incrementality involves match market testing and synthetic controls, though brands must evaluate overall growth objectives rather than isolated metrics to avoid short-sighted decisions.
“You can’t always look at one metric or you’re going to be very shortsighted,” Holleran said. “How are you looking at your overall brand growth objectives and not looking at a moment in time, but really looking at that long-term impact.”
Roundel focuses on new-to-brand acquisition and long-term customer value development through incremental measurement approaches.
Full-funnel approach remains relevant
Commerce media evolution toward primary brand growth driver operates through comprehensive funnel strategies that acknowledge continued consumer shopping, discovery, and conversion patterns despite non-linear progression.
“Understanding the funnel isn’t dead. I know that is a hot topic that has been debated for years, but the guests, they still shop. They still want to discover,” Holleran said. “We still have to reach out to them through awareness and we’re still trying to talk to them through conversion.”
Mutual growth between brands and retailers creates aligned incentives for sustained development across different business stages, from startup brands beginning their journey to established companies seeking expansion opportunities.
“When brands win, we win at the retailer. So there is that mutual growth that we’re all looking for,” Holleran said.
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