Target is off to a rocky start in 2025. The retail chain has faced continuous backlash from consumers over its unfavorable decision to pull back on diversity efforts, on top of price hikes triggered by recent economic turmoil. Fed-up shoppers are now turning to competitors like Costco for their everyday essentials, leaving Target in the dust—and the earnings report speaks for itself. Keep reading to learn why shoppers are abandoning Target and how the retail giant is trying to win them back.
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Target’s depletion of DEI programs has led to a slump in foot traffic.
A 40-day consumer boycott is underway at Target after the company announced it would terminate its Racial Equity Action and Change (REACH) initiatives and diversity, equity, and inclusion (DEI) programs, including the Human Rights Campaign’s (HRC) Corporate Equality Index. And yet, Target ensures its customers that “belonging for all is an essential part of our team and culture.”
In the wake of Donald Trump’s inauguration and highly contested executive orders, the news has left shoppers concerned and disappointed—and rightfully so. “Black people spend upwards of $12 million dollars a day, and so we would expect some loyalty, some decency and some camaraderie,” Rev. Jamal Bryant, an influential Atlanta pastor who helmed the boycott, told CNN.
Target is already feeling the effects of the shopping ban. Market research firm Placer.ai reported that in-store visits for the week of March 3 were down 6.8 percent year-over-year, marking Target’s sixth consecutive week of low traffic. Additionally, traffic for February 2025 fell by nine percent from the year prior.
Conversely, Costco, which has vocally condemned the war against DEI dismantling, is experiencing a surge in customer visits, says Retail Brew.
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Impending tariffs will likely cause Target prices to skyrocket, says company CEO.
Inflation is expected to worsen due to tariffs executed by President Trump, some of which have already gone into effect. The 25 percent tariff on Canadian and Mexican goods and 10 to 15 percent tariff on items from China will impact more than $120 billion in U.S. goods, according to Yahoo! Finance. With the imposed markup, shoppers are tightening their purse strings.
Target CEO Brian Cornell is anticipating price hikes as a result, especially among grocery items. But when it comes to apparel and home goods, chief commercial officer Rick Gomez told CNBC that the company is adopting a more strategic approach.
“We have to think about this from a consumer perspective and make sure that our pricing architecture makes sense and puts us in a place where we are competitive and we have affordable options,” he explained.
An earnings report obtained by Yahoo! Finance showed that Target’s profit margins and sales have fallen by the wayside. Moreover, in the last year, the stock has crumbled by 24 percent. Analyst Mark Astrachcan, who works at the banking investment firm Stifel, predicts Target will rake in a $130 million profit, down $15 million from his original estimate for the year.
In an interview with NBC News, GlobalData managing director Neil Saunders said price increases are inevitable.
“Now that these tariffs are coming into play, the cost of many of these products are going to go up quite substantially,” he said. “There’s no way that retailers can afford to absorb all of this cost increase themselves and keep prices the same for the customer.”
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Target is reinstating its Circle Week promotion and expanding merchandise offerings to reel in customers.
Target is incentivizing shoppers to spend their hard-earned cash this month with a blockbuster spring sales event. Circle Week will run from March 23 to March 29, during which Target Circle members can save up to 40 percent on apparel, beauty items, food, furniture, and home goods, both in-store and online, per a press release. Shoppers can unlock additional promotions, such as Deal of the Day, a 24-hour flash sale on select products.
Circle Week is only available to Target Circle members. However, the loyalty program is free to join. Those who belong to Target Circle 360 (a membership tier with a $99 annual fee) will have access to even more rewards.
In a March 4 press release, Target announced plans to invest roughly $5 million in stores and merchandise. Specifically, the company is focusing on brand innovation and “trend-forward newness” in the home assortment category and is looking to expand its gaming, sports, and beauty inventory. This year, Target is set to open 20 new locations.
