Target sees drop in sales after rightwing backlash to Pride merchandise

The rightwing backlash to the retail giant Target’s Pride Month merchandise contributed to a sharp drop in sales over the last three months, the company announced on Wednesday. Target is reviewing how it will market its Pride Month merchandise next year.

Over the last three months, sales at the retailer fell 5.4%, a higher decline than Wall Street expectations, according to the company’s second-quarter earnings report. The company decreased its profit outlook for the year and said it expects further declines for the rest of the year.

The decrease comes after Target saw immense growth during the pandemic, as customers flocked to the company’s stores and websites during lockdown, and the company deeply discounted items to get rid of inventory. At the beginning of 2023, the company reported $30bn growth since 2019.

Company execs say the recent decrease in sales speaks to changing consumer spending due to factors like higher interest rates and increased prices for food and other essentials. Americans are also spending less at stores and focusing more on experiences.

“Guests are out at concerts. They’re going to movies, they’ve seen Barbie. They’re enjoying those experiential moments, and they’re shopping in favor of travel or spending time out of the house in other ways,” Brian Cornell, Target CEO, told reporters.

Target leaders also said the backlash to its Pride Month collection also hurt sales, though the specific impact could not be quantified.

“The strong reaction to this year’s Pride assortment affected sales,” said Christina Hennington, Target’s chief growth officer, on Wednesday. “The reaction is a signal for us to pause, adapt and learn.”

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In May, Target became the focus of conservative backlash against LGBTQ+ pride merchandise that it was selling at its stores for Pride Month, which takes place in June. Though the company had been selling Pride merchandise for over a decade, it reported an increased number of customers who were threatening employees at stores over Pride Month displays. In response to these “volatile circumstances”, the company said it would be removing some of its Pride merchandise and would move displays to the back of stores.

Target’s response to the conservative backlash provoked a separate backlash from the left, who said the company was caving to extremists.

“CEO of Target Brian Cornell selling out the LGBTQ+ community to extremists is a real profile in courage,” the California governor, Gavin Newsom, tweeted in May. “This isn’t just a couple stores in the south. There is a systematic attack on the gay community happening across the country.”

On Wednesday, Cornell said the company has been re-evaluating its strategy around Pride Month after the backlash.

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“We’ll continue to celebrate Pride and other heritage moments, which are just one part of our commitment to support diverse teams and guests,” Cornell said. “However, as we navigate an ever-changing operating and social environment, we’re applying what we’ve learned to ensure we’re staying close to our guests and their expectations of Target.”

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Target is one of the first large retail companies to report their second-quarter earnings, so it is unclear how much of the sales decline is specific to the retailer versus an overall decline in consumer spending at stores.

Anheuser-Busch InBev, the parent company of Bud Light, also reported a decline in US sales earlier this month after it faced an intense conservative backlash for sponsoring a post by the transgender influencer Dylan Mulvaney in the spring.

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