Observed Signal · Jun 2, 2026 · Policy Update · Source: Modern Retail · Impact: 4/5 · Sentiment: Negative
Target's DEI Pullback Spurs Black-Owned Brands' Removals
Modern Retail reports that multiple Black-owned consumer brands say their products have been removed from Target stores in recent years, a trend founders link to Target’s 2025 pullback on certain diversity, equity and inclusion (DEI) initiatives and to opaque assortment and merchandising decisions. Founders — including Afro Unicorn’s April Showers and Ride FRSH’s co-founders — describe poor communication from buyers, unexpected fees for certifications and paid promotions through Target’s retail media network Roundel, and inventory/warehousing costs. Target says assortment changes are based on product performance and that it has increased the number of Black-owned brands vs. 2020. The story also notes investor and activist scrutiny of Target’s reputation after the DEI changes and cites company financials showing a 1.7% net sales decline from 2024 to 2025 and a Q1 2026 sales growth reported by CEO Michael Fiddelke.
Policy and assortment changes at a major retailer (Target) affect brand distribution, retail media monetization (Roundel), supplier relationships and investor scrutiny — all important to retail and retail‑media strategies.
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Key Takeaways & Evidence Grounding
- Afro Unicorn entered Target and Walmart in 2022; its products were cleared from Target stores by the end of 2025.
- Founders report communication gaps with Target buyers and unexpected costs, including paying for certifications and paid placements through Target’s Roundel retail media network.
- Target said it bases assortment changes on product performance and reported Q1 sales growth in 2026; its net sales fell 1.7% from 2024 to 2025 to $104.8 billion.
- Target said it carries hundreds of Black-owned brands in stores, double the amount compared to 2020, and reported fulfilling a 2021 commitment to invest $2 billion in Black-owned businesses.
- Some formerly Target-stocked Black-owned brands mentioned as removed or affected include Alikay Naturals, Oyin Handmade, Curls Dynasty, The Lip Bar, WNDR LN, and GlowRx.
Connected Companies & Entities
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Related Market Signals & Shifts
Recent verified developments and strategic activity across this market segment.
Target Alienates Black-Owned Brands, Founders Say
Multiple Black-owned founders say their products have been removed from Target stores and websites after the retailer scaled back certain diversity, equity and inclusion (DEI) initiatives. Entrepreneurs including April Showers of Afro Unicorn and the founders of Ride FRSH describe poor communication from Target buyers, unexpected promotional costs through Target’s Roundel retail media, inventory and warehousing losses, and revenue declines after being dropped or delisted. Target says assortment changes reflect product performance and shopper demand, notes it has doubled the number of Black-owned brands in stores since 2020 and says it fulfilled a 2021 $2 billion commitment to Black-owned businesses. The DEI pullback has prompted consumer boycotts and activist investor pressure; Target CEO Michael Fiddelke acknowledged trust must be rebuilt after sales dropped in 2025.
Target Beauty Studio Includes Almost No Black-Owned Brands
Target is launching "Target Beauty Studio" on Sept. 10 in more than 600 stores and online, a curated assortment of over 1,600 products from 90 largely new-to-Target brands that replaces former Ulta shops. Modern Retail found only two brands in the 90-brand list that appear to be Black-owned or -founded: Briogeo and Glamazon Beauty. Target says the collection emphasizes global brands and that nearly 40% of the brands were founded by "diverse" founders, but it did not define that term. The limited representation of Black-founded brands has renewed criticism of Target’s post-DEI changes, supplier engagement and its historical relationships with Black entrepreneurs; industry consultants urged transparency and potential commitments such as the Fifteen Percent Pledge.
Target's Ad Revenue Soars Despite Sales Decline in 2025
Target reported $915 million in advertising revenue for 2025, driven primarily by its ad arm Roundel, and $295 million in ad revenue in Q4 2025 (a 55.3% increase year over year). The retailer’s fourth-quarter net sales were $30.5 billion, down 1.5% year over year (3.9% year‑over‑year drop in comparable sales). Executives, including new CEO Michael Fiddelke, promised a return to growth in every quarter of 2026 and outlined merchandising and customer-experience changes: faster fashion production, a revamped home section, a Target Beauty Studio launching later in the year, expansion of third‑party marketplace Target+, and adjustments after the in-store Ulta partnership expires in August. Leadership moves include Michelle Mesenburg named senior vice president and chief brand officer and Cara Sylvester moving to chief merchandising officer.
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