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For more than a year, Target (TGT) has suffered declining sales, significantly impacting its bottom line.
The decline in sales first kicked off during the summer of 2023 when the retailer faced a massive boycott from consumers over its pride collection, which faced criticism for being marketed toward children.
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Later that year, Target raised alarm bells about rising retail theft in its stores nationwide, which forced it to close nine locations in four different states.
Related: Target’s latest attempt to win back shoppers faces criticism
Most recently, Target also flagged that its customers have been pulling back on their spending in its stores even after it cut prices on thousands of items last year. The retailer blamed the change in customer behavior on economic pressures such as inflation and higher living costs.
In its fiscal third-quarter earnings report, released in November, Target revealed that its comparable sales (sales at stores open more than a year) only increased by just 0.3% year over year. The money customers spent per purchase also shrunk by 2%, compared to the same period a year earlier.
Target is expected to release fiscal fourth-quarter results around March 4.
Target discontinues major initiatives
As Target struggles to win back customers, it has opted to make a controversial move.
The retailer has scaled back its diversity, equity, and inclusion program, a growing trend in corporate America that has garnered both praise and backlash from consumers.
Target recently sent a memo to employees informing them that it will no longer be reporting to the Human Right Campaign, which tracks LGBTQ+ corporate policies and practices.
It is also ending its three-year DEI goals and will conclude its Racial Equity Action and Change initiatives.
Some of those initiatives include advancing careers of Black employees, instituting anti-racism training for team members, promoting Black-owned businesses, sourcing products from Black suppliers, prioritizing philanthropic investments to address racial inequities in Black communities, etc.
Related: Walmart, Lowe’s among retailers that caved to blowback in 2024
“Many years of data, insights, listening and learning have been shaping this next chapter in our strategy,” said Kiera Fernandez, chief community impact and equity officer at Target, in the memo. “And as a retailer that serves millions of consumers every day, we understand the importance of staying in step with the evolving external landscape, now and in the future – all in service of driving Target’s growth and winning together.”