Recent economic uncertainty piled on top of an already troubling time for many major retailers has resulted in the obvious for these companies: less foot traffic.
Target or Walmart, despite being supermarket giants and the go-to store to make a stop at when shoppers need groceries, have been noting a decline in foot traffic lately. A dip in consumer confidence can be cited as the reason behind this. The prices of products continue to rise, yet salaries remain stagnant and as such it is becoming increasing difficult to stay afloat for the average consumer. Not to mention the socio-political aspect of why shoppers are opting away from these big corporations.
President Trump’s move to end all Diversity, Equity, and Inclusion (DEI) policies within the federal space resulted in many major retailers including Target and Walmart, to follow suit after being pressured by the conservative think tank. As a result, consumer-led boycotts have been ongoing against many of these retailers, Target included.
Target records the biggest dip in foot traffic
According Placer.ai, both Walmart and Target have been recording a decline in foot traffic for the last two consecutive months. For February, both supermarkets saw a 5% drop in foot traffic, with this figure increasing again for March.
This has been a common occurrence faced by just about every retailer in recent months, however, Target seems to be seeing a much larger fall when compared to competitors. This issue can also be attributed to the fact that consumer confidence took more than a 10% plunge during March–and things are likely to worsen as Trump’s tariffs come into effect. Economists have confirmed that a significant amount of products and services will face price hikes as a result.
According to the report conducted by Placer.ai, “Target’s foot traffic sank 9% in February compared to the prior year and 6.5% in March, a time frame that includes its Target Circle Week promotion. That’s a larger fall than reported for Walmart, which lost 5.7% in February and 3.8% in March.”
Ongoing boycotts
National and local boycotts of Target, along with several other major retailers, have been ongoing since around February as a result of the retailer’s decision to axe its DEI policies. The assumption was that this move came about as a result of the President’s decision to do the same during his first week in office. However, the company has since been maintaining that the decision to end DEI policies was a previously planned move, independent of the President.
Whatever the case may be, both customers and shareholders were not impressed with the decision. The pressure against Target was ramped up after consumers discovered that Costco reiterated the importance of DEI practices within the company and the warehouse club became an attractive alternate. As a result, Costco is reported to have grown by 2.2% in February and 7.5% in March.
Whilst boycotters are considering these figures to be a victory for their efforts, foot traffic remains an indicator and is not on par with actual revenue. According to a company report, the retailer faced “a 3.1% Q4 decline compared to the same quarter the prior year, a period that precedes boycotts.”
The broader troubling nature of the economy recently is also a huge cause for concern for many retailers who do not want to increase prices due to the tariff hikes, but also do not want to absorb the costs internally either. Additionally, prior to the troubles with tariffs, it was found that customer confidence had dropped “11.9% from February to March, a 28.2% decline from the prior year,” as per University of Michigan’s oft-cited consumer confidence survey.
“The expectations index plunged a precipitous 18% and has now lost more than 30% since November 2024,” says survey director Joanna Hsu. “This month’s decline reflects a clear consensus across all demographic and political affiliations; Republicans joined independents and Democrats in expressing worsening expectations since February for their personal finances, business conditions, unemployment, and inflation.”