Analysis: Target needs to follow Starbucks to win customers back

37 minutes ago 1

Daniel Kline

Sun, November 23, 2025 astatine 11:33 AM CST 5 min read

Target keeps booking caller musicians to play connected the platform of its sinking vessel without really fixing the spread successful the hull.

The concatenation has battled slowing income and has seen same-store income driblet for each of the past 3 quarters. That has been blamed connected its "woke" governmental stances, its DEI policies, and assorted boycotts.

The results were not amended successful its astir caller quarter.

Net income of $25.3 cardinal successful the 3rd 4th were 1.5% little than past year, reflecting a merchandise income alteration of 1.9 percent, partially offset by a 17.7% summation successful non-merchandise sales.
Third-quarter GAAP EPS was $1.51 compared with $1.85 past year. Adjusted EPS, which excludes non-recurring severance and asset-related charges, was $1.78.
Comparable income decreased 2.7% successful the 3rd quarter, reflecting a comparable store income diminution of 3.8%, partially offset by comparable integer income maturation of 2.4%.
Third-quarter operating income, which includes the interaction of non-recurring items, was $0.9 billion, 18.9% little than past year.

These aren't disastrous numbers, but the existent anemic system should propulsion consumers to Target.

Instead, the concatenation has worked hard to propulsion its customers away.

"Target utilized to get this rep that it was the fancier, nicer Walmart," 1 of the chain's regular customers told Business Insider. Suddenly, she said, "it wasn't this nice, magical spot anymore."

That's the occupation facing Target. It didn't suffer customers due to the fact that it made moves that supported inclusivity. Instead, the concatenation mislaid its "Tah-zhay" magic, the happening that made the third-cheapest large retailer a spot consumers sought out.

Walmart and Amazon had little prices, but Target was special, a spot to locomotion around, person a coffee, bargain immoderate things you needed, and possibly immoderate things you didn't.

<em>Target has leaned into curbside pickup successful immoderate markets.</em>Target

For a fewer years, Starbucks was caught up successful "woke" speech connected 1 broadside and a labour conflict connected the other. Visiting the concatenation was, to some, a governmental statement, and that's not bully for business.

New CEO Brian Niccol made a concerted effort to alteration the communicative and punctual radical wherefore they liked the java concatenation successful the archetypal place. He called it "Back to Starbucks," and its pillars are comparatively simple.

Focus connected customer experience: Faster service, amended staffing, and welcoming stores.
Investing successful menu innovation: Protein acold foam, customizable drinks, refreshed baked goods, and health-forward options.
Digital improvements: Revamped Starbucks app, enhanced Order & Pay, and updated Rewards program.
Store renovations: Nearly 70 completed, 1,000+ planned, and much “coffeehouse” formats vs. pickup-only.
Operational streamlining: Cutting 30% of food/beverage items to simplify menu.
Q4 FY25 saw global comparable store income emergence 1%, the chain's archetypal maturation successful 7 quarters.
Source: Letter from Starbucks CEO Brian Niccol