Target's DEI retreat angered both sides as comps fell for a third straight year

In January 2025, a few days after Donald Trump's inauguration, Target announced changes to its corporate DEI programs: it would no longer participate in third-party diversity surveys and renamed its 'supplier diversity' team to 'supplier engagement.' For a retailer whose brand was built on loud inclusivity, the rollback read as retreat — and both flanks attacked. Progressive customers organized boycotts; Rev. Al Sharpton's National Action Network considered one until CEO Brian Cornell met him in April; even conservative critics stayed unconvinced.

The stage had been set in 2023: Target's Pride Month displays drew angry customers who destroyed signage and confronted workers, with conservatives and some members of Congress urging a boycott. Target pulled the displays — and immediately drew demands from LGBTQ+ advocacy groups to publicly reaffirm its commitment. 'I think they pissed off one side of the political spectrum, they acknowledged that and then pissed off the other side that they were supposedly defending in the first place,' said Telsey's Joe Feldman, adding Target also 'showed that they could get pushed around.'

The January 2025 changes landed on a business already sliding. Q1 2025 merchandise sales fell 3.1% to $23.4 billion, comps fell 3.8% with every category but one down, and Target guided to a low-single-digit sales decline for the year — a third straight year of flat or negative comps while Walmart grew by almost another Target (~$86 billion). Cornell conceded the DEI backlash hit Q1 results, though individual headwinds were hard to quantify. Target's own Instagram comments read like an exodus: 'haven't been to Target since last year.'

Target's differentiator was values-driven retail, so DEI was not an admin program — it was merchandise-adjacent brand equity that cuts hurt the moment they were noticed.

The 2023 Pride rollback taught both sides that Target folds under boycott pressure, so the January 2025 changes triggered a new boycott instead of ending the old one.

The timing — days after Trump's inauguration — made the changes look reactive rather than principled, undermining trust on both flanks.

The rollback hit a business already in decline: sales fell in 2023 and 2024 after 2022's operating income dropped 57%, so the boycott compounded rather than caused the pain.

A brand built on values cannot scale them back quietly. Capitulating to one boycott doesn't end the fight — it teaches every side that pressure works, and the next one starts immediately.

Cornell admitted in a May 2025 email to employees that leadership silence had 'created uncertainty,' insisted 'we are still the Target you know and believe in,' and the company pursued fixes: new brands, meetings with activists including Sharpton, a strategic refocusing initiative and an executive shake-up — while pausing Ulta Beauty shop-in-shops temporarily. NYU professor Alison Taylor said Target was serving as a proxy target for activists reshaping retail, and that in retrospect 'a case' existed for sticking to its guns. Analysts doubted the turnaround could come quickly.