Target is again facing a storm of criticism over an unforced error on diversity as it tries to navigate a challenging turnaround.
The Minnesota-based retailer landed in the cultural crosshairs after it marketed a children’s Halloween costume with imagery that bore a striking resemblance to racist minstrel show posters.
The retailer pulled the merchandise and issued an apology on Monday, but critics on social media have not been so quick to let the issue go.
“It’s astonishing that they found themselves in the situation yet again,” former Target vice chairman Gerald Storch told Business Insider.
On Tuesday, Target’s stock closed nearly 4% below its price on Monday, before the story broke overnight.
A company spokesperson declined to comment beyond the statement.
“It’s a very unfortunate misstep that interrupts a stream of good news from Target, because the business has been making progress,” Global Data retail analyst Neil Saunders told Business Insider.
Target last week reported its second quarter of strong sales and traffic growth as it looks to mount a comeback after years of lackluster performance. The company is now in the midst of a critical back-to-school shopping season.
“What they’ll need to watch is whether this opens old wounds about DEI, whether it alienates some customer groups,” Saunders added.
Target endured a year of boycotts in 2025 after the company wound down several of its diversity, equity, and inclusion initiatives.
Target’s latest stumble — and those from other brands in recent years — shows how the fast-paced, boundary-pushing nature of Halloween merchandising can be especially risky for retailers. Costume makers can easily veer into negative stereotypes and offensive tropes in the attempt to create something funny or scary.
Storch said the company should not get too distracted with this episode and continue its focus on its core business: offering products that people need and want.
“The Halloween costume snafu just leaves you puzzled how anyone could have seen that and thought it was OK, but it isn’t a policy issue. It’s an execution issue,” he said.
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