Target backlash prompted by 'one item' that 'made the difference': Gerald Storch
Former Target Vice Chairman Gerald Storch discusses the retail store's dropping market value as it faces consumer backlash over its pride swimwear.
Target has seen a significant drop in its market value as the retail giant faces a consumer firestorm over the displaying of pride merchandise in stores around the nation.
This controversy follows a boycott against Bud Light due to their decision to market products with transgender social media influencer Dylan Mulvaney.
Former Target Vice Chairman Gerald Storch joined "Fox & Friends Weekend" and revealed the one item that "made the difference" against the competition and sparked the backlash.
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He explained that many retailers carry pride merchandise, "you know, the plates that had different colors in it. Fine. You show the rainbow, you know, a gingerbread house, whatever you are, that's all you know. Who cares? Everybody carries that stuff."
Storch targeted one item from the store's pride collection that set it apart from its competition and ignited the consumer firestorm.
"I've never seen a case where one item, that tuck swimsuit, that's really what made the difference versus the competitors. That's where the big mistake [was] made," said the former Target executive.
Target Pride swimsuits boasted "tuck-friendly construction" and "extra crotch coverage," presumably to accommodate male genitalia, even if they are made in an otherwise female style. (Brian Flood/Fox News)
The former executive shared an example of how he handled controversy with Babies "R" Us.
"We had a contest where the first baby of the year would get $20,000. You know, people were up in arms because guess what, the first baby the year was born to an undocumented immigrant and they didn't have a tax I.D. or anything, and the people are, 'oh, God, you can't give it to them. You have to give it to them. Figure out a way.' He continued, "You know what we did, we gave it to two babies and we put out a giant press release. We love all babies."
"At the end of the day, if you embrace and you show that to people and you know, I hear you every morning, you know this, too. That's how you get a problem, is you have to address it as a real problem and show love for people and it works," he added.
"Now going out of the problem, you have to show love. I know that sounds kind of funny, but, you know, forgiveness and love, that's part of America and that's what you have to do."
Storch noted that Target experienced economic trouble as well.
"Target stock has certainly been performing poorly off 11% year to date. So that's not good, and certainly, this boycott of the whole issue here isn't helping. It's very distracting to have that going on in the business. But there are more fundamental concerns with that, with the environment, with the consumer and with the business here," he noted.
The company's market value has taken a tumble since mid-May with a decline of over $12 billion dollars.
"Target's decline in stock, -- actually began on May 18th." He explained, "that's the day Walmart reported seven percent gain in comp store sales on the prior day. Target had reported flat sales, year flat at Target, up seven at Wal-Mart. There's no way that comparison looks good."
"The consumer is feeling very stressed, very stressed by the environment, by inflation, and Target is known as the upscale discounter. So it's not good to be the upscale discounter at a time when the consumer doesn't have a lot of money to spend. So they're migrating more to Wal-Mart, and that's a huge problem."
"While there's no doubt the boycott is part of the problem, if you read the reports about Target during this period and the analysts keep in mind related to the investors, who are the ones who are buying things about the stock or in this case probably selling picks amount of stock. They're more concerned with the fundamental business issues."
Storch noted that Target's investors are watching "very, very carefully" and want to know the impact on sales.
"You know, they [Target] certainly didn't handle this well, either going in or trying to deal with it on the way out. But I think over time, this is not going to be a big issue for them," he said.