Target's plan to scale back Pride Month merchandise puts it in 'a no-win situation,' retail expert says

By James Rogers

Target says its 2024 Pride collection will be available on its website 'and in select stores, based on historical sales performance'

Target Corp.'s recent announcement that it would scale back its collection of Pride-themed merchandise this year represented the company "caving to a vocal and hostile contingent" and created "a no-win situation," one retail expert says.

The Minneapolis-based retail giant, which has offered Pride-themed products for more than a decade, last year faced intense anti-LGBTQ+ backlash from conservatives ahead of Pride Month in June. Citing concerns about employee safety, Target ultimately removed certain Pride-themed products from some stores, a move that drew criticism from Target employees who believed the company had yielded to a bad-faith pressure campaign.

That experience appears to have shaped the company's approach to Pride Month this year. Unlike last year, Target (TGT) is not offering children's clothing as part of its Pride collection. Target will make the collection available on its website "and in select stores, based on historical sales performance," the company said in a statement earlier this month.

A Target spokesperson told MarketWatch that the products, which start at $3, have been "curated based on guest insights and consumer research."

From the archives (August 2023): Here's why Target removed Pride-related items, according to its CEO

But Carol Spieckerman, president of retail advisory firm Spieckerman Retail, told MarketWatch that Target has placed itself in "a no-win situation of its own making" and noted that many other retailers, including rival Walmart Inc. (WMT), carry Pride merchandise.

"Scaling back only makes Target look weak without satisfying the desires of its progressive customers or the all-or-nothing demands of troublemakers," she said. "Target isn't responding to a lack of demand so much as caving to a vocal and hostile contingent that has identified Target as a high-profile example."

The hostile response to Target's 2023 Pride collection has been described as part of a so-called culture-war campaign against major brands over their diversity, equity and inclusion efforts. Last year, right-wing activists led a high-profile backlash against Anheuser Busch InBev brand Bud Light (BUD) following its partnership with trans influencer Dylan Mulvaney. Separately, companies ranging from Cracker Barrel Old Country Store Inc. (CBRL) to Walt Disney Co. (DIS) have come under fire.

From the archives (May 2023): 'Target doesn't have a spine': Workers slam retailer's decision to pull LGBTQ Pride-themed products amid backlash

However, Spieckerman acknowledged Target's internal efforts around inclusion. "Target is known for walking the talk where it counts most, by fostering an inclusive corporate culture," she said. "It's too bad Target feels it must waver and sit on the fence with its consumer-facing strategies."

Target didn't immediately respond to a request for comment about Spieckerman's criticism, but a company spokesperson earlier told MarketWatch that the retailer is "committed to supporting the LGBTQIA+ community during Pride Month and year-round."

"Most importantly, we want to create a welcoming and supportive environment for our LGBTQIA+ team members, which reflects our culture of care for the over 400,000 people who work at Target," the spokesperson added.

Target has long offered benefits and resources for the LGBTQ+ community and will have internal programs to celebrate Pride 2024, the spokesperson said. "Beyond our own teams, we will have a presence at local Pride events in Minneapolis and around the country, and we continue to support a number of LGBTQIA+ organizations."

Related (June 2023): Target boycott may be a 'really important case' for retailers who experience backlash

When Target reported its second-quarter results in August 2023, the company's chief financial officer, Michael Fiddelke, said that traffic and top-line trends had been affected by the reaction to the company's Pride collection last year. Speaking during a conference call to discuss those results, Chief Growth Officer Christina Hennington described the reaction as a signal "to pause, adapt and learn." This, she added, would ensure that Target's future approach to "moments" such as Pride Month balances celebration, inclusivity and broad-based appeal.

Target shares ended Friday's session up 4.2%, outpacing the S&P 500 index's SPX gain of 0.8%. The retail giant's stock is up 9.7% in 2024, compared with the S&P 500's gain of 10.6%.

-James Rogers

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

06-01-24 0727ET

Copyright (c) 2024 Dow Jones & Company, Inc.