Former Target exec says Pride collection's 'tuck-friendly' swimwear was the 'biggest mistake'
Target suffered another financial setback after JPMorgan downgraded its stock as its market value plummeted by $12billion
He said other companies carried colored plates and gingerbread houses and that's 'fine' because 'who cares? Everybody carries that stuff'
Former Target Vice Chairman Gerald Storch believes the company's 'tuck-friendly' swimwear set Target's Pride collection apart from others for the worst
Former Target executive said the retailer's biggest mistake was selling 'tuck-friendly' swimwear for Pride, which has led to a $12billion loss since mid-May.
Former Target Vice Chairman Gerald Storch believes the company's controversial 'tuck-friendly' swimwear set Target's Pride collection apart from others for the worst.
'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,' he told Fox and Friends.
He said other companies carried colored plates and gingerbread houses and that's 'fine' because 'who cares? Everybody carries that stuff.'
Target suffered another financial setback after JPMorgan downgraded its stock as its market value plummeted by $12billion, amid backlash to its controversial LGBTQ Pride product release.
Former Target Vice Chairman Gerald Storch believes the company's controversial 'tuck-friendly' swimwear set Target's Pride collection apart from others for the worst
'Target stock has certainly been performing poorly off 11 percent 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,' Storch said.
The brand's shares dropped for the ninth consecutive day Wednesday, falling by a further 2.14 percent as the company is in the midst of its longest stock-losing streak in 23 years.
Before the controversy, the company's market value had been $74billion, with shares trading at $160.96 at the close of markets on May 17.
And despite efforts by the brand to backpedal on its disastrous campaign, continuous stock falls led JPMorgan to downgrade its stock from 'neutral' to 'overweight' on Thursday, citing 'too many concerns rising.'
'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,' he said
The brand's shares dropped for the ninth consecutive day Wednesday, falling by a further 2.14 percent as the company is in the midst of its longest stock-losing streak in 23 years. Before the controversy, the company's market value had been $74billion, with shares trading at $160.96 at the close of markets on May 17
'We continue to believe that the consumer is broadly weakening while the share of wallet shift away from goods (51% of [Target’s] sales) is ongoing,' wrote JPMorgan analyst Christopher Horvers, according to MarketWatch.
Horvers also cited 'recent company controversies' as the reason Target has suffered devastating financial losses, which came after 'an impressive run of 12 consecutive positive quarters.'
As customers rebelled against the move, the brand made 'adjustments' to its Pride merchandising plans, including removing displays 'that have been at the center of the most significant confrontational behavior' at some of its stores, CEO Brian Cornell said in a statement last week.
Some Southern stores were forced to move merchandise - many of which were designed by Erik Carnell, a transgender man and self-proclaimed Satanist - to the back of stores.
In addition, Storch, who owns his own company now, said the company's decline started on May 18 when competitor, Walmart, reported 'a seven percent gain in comp sales.'
'Target had reported flat sales, year flat at Target, up seven at Wal-Mart. There's no way that comparison looks good,' he said.
'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.
'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.'
Source: Daily Mail
