Goal, which has nearly 2,000 shops nationwide, has confronted weak retail gross sales amid financial pressures, and up to date controversies have additional strained its popularity. To deal with these hurdles, the corporate is betting massive on a key in-store enlargement to re-engage consumers.
Within the third quarter of 2025, Goal’s comparable retailer gross sales dropped by 3.8% yr over yr, in line with its newest earnings report. Moreover, Placer.ai knowledge confirmed that foot site visitors at Goal shops declined by 2.7% throughout the quarter, in comparison with the identical time interval in 2024.
The lower in demand comes after Goal confronted backlash for chopping again its variety, fairness and inclusion insurance policies, which sparked a number of boycotts from customers who disagreed with the choice.
Goal has additionally been struggling to draw price-conscious consumers in its shops amid inflation and better residing prices.
Throughout an earnings name in November, Goal Chief Industrial Officer Richard Gomez stated that the corporate noticed “continued softness in discretionary categories like home and apparel.”
“Guests are choiceful, stretching budgets and prioritizing value,” stated Gomez. “They’re spending where it matters most, especially in food, essentials and beauty, while looking for trend-right deals in discretionary categories.”
Customers have certainly been rising extra cautious about their discretionary spending, a pattern that isn’t anticipated to vanish anytime quickly.
A survey from McKinsey & Firm in December discovered that 57% of customers are chopping again nonessential spending. Particularly, 43% plan to lower dwelling decor spending, whereas 38% plan to spend much less on attire.
Goal is shifting gears after it noticed a decline in gross sales throughout the third quarter of 2025.
Shutterstock
Goal bets on a daring in-store change
Earlier this month, Michael Fiddelke formally turned Goal’s new CEO, and in a memo, he stated the corporate has “real work to do” to earn again belief from prospects. One of many priorities he vowed to push contains “leading with merchandising authority” by specializing in “design, style and value.”
Goal seems to be shifting ahead with this initiative as it’s increasing its partnership with Levi’s, the highest denims model within the U.S., in line with a current press launch.
This may lead to Levi’s denim merchandise being launched to an extra 150 Goal shops by the tip of this yr. After this enlargement, greater than 1,000 complete Goal places nationwide will promote Levi’s denim.
By Spring, Goal plans to develop its Levi’s girls’s assortment by nearly 20% yr over yr.
Associated: Goal makes drastic workforce shift to repair buyer expertise
Goal states that the gathering will function “best sellers with new trend-driven pieces,” resembling “relaxed and looser leg silhouettes, updated washes and added lifestyle pieces like tops and overalls for easy, head-to-toe outfitting.” Most kinds will even be priced beneath $60.
“Levi’s is the #1 denim brand in the world and our evolution into a head-to-toe denim lifestyle brand is resonating with Target guests,” stated Heidi Manes, managing director of Levi’s U.S. and Canada, within the press launch. “Our expansion with Target reflects the momentum behind our lifestyle assortment, the strength of our partnership and our commitment to reaching Levi’s fans wherever they choose to shop.”
Goal and Levi’s trip a rising client pattern
This enlargement is not going to solely profit Goal’s gross sales but additionally Levi’s, which has been fighting sluggish income.
Levi’s revealed in its fourth-quarter earnings report for 2025 that its internet revenues within the U.S. decreased by 7% yr over yr. The decline comes after it applied worth will increase final yr as a consequence of tariffs, a transfer it plans to repeat this yr.
Regardless of the income dip, Levi’s direct-to-consumer enterprise within the U.S. grew by 6% throughout the quarter.
Throughout an earnings name final month, Levi’s CEO Michelle Gass stated the corporate is seeing “strong demand” for its tops resembling sweaters, wovens and outerwear. Particular kinds in bottoms are additionally gaining reputation.
Extra Retail:
- Lowe’s rolls out free presents for purchasers amid challenges
- House Depot and Lowe’s quietly acquire new rival
- Kroger provides beneficiant provide for purchasers as grocery costs rise
“Within our bottoms business, we are showcasing our most diversified portfolio yet with everything from our core icon to our innovative fashion fits and nondenim bottoms, all delivering growth,” stated Gass. “While skinny and straight fits remain popular, loose and baggy styles continue to accelerate.”
Denims have seen a spike in client demand worldwide, a pattern that Goal and Levi’s seem like leaning into additional with their expanded partnership.
A survey from Cotton Included final yr discovered that 48% of customers are sporting denims extra usually than ever. Additionally, 45% favor to buy denims from bodily shops slightly than on-line.
“Thanks to our comprehensive international consumer survey data, we can confirm that global consumers are increasingly choosing to wear denim jeans,” stated Andrea Samber, director of brand name partnerships for Cotton Included, in an announcement. “Data demonstrates the majority of consumers love their cotton denim jeans for comfort, quality and durability.”
Goal battles a significant shift in client habits
Goal’s newest transfer to strengthen its merchandise authority additionally comes as many retailers are preventing to compete with the rising pattern of thrift procuring.
Many customers throughout the nation are opting to thrift their clothes and different merchandise, primarily to economize, in line with a current survey from Talker Analysis, which was commissioned by Mercari.
Why People are turning to thrift procuring:
- About 66% of People usually store at thrift shops to stretch their budgets.
- Practically 1 in 6 thrift store weekly.
- Secondhand clothes is the hottest thrift class, with 71% shopping for pre-owned attire.
- Roughly 45% of People thrift dwelling decor, making it the second-most-popularclass, adopted by books (40%) and residential items (39%).
- Whereas 51% say they thrift store as a result of they take pleasure in scoring a deal, 42% like trying to find distinctive, one-of-a-kind gadgets, and 28% seek for collectibles.
Supply:Talker Analysis
“As the data shows, thrifting is multidimensional,” stated Jeff LeBeau, vp of development at Mercari, in an announcement. “It’s something people are doing to spend responsibility these days, but it’s also a hobby for many. Not only is it an affordable option for shoppers due to financial constraints, but thrifters also just thrift for the fun of it, and to find unique deals.”
Associated: Kroger quietly reduces an important retailer service for purchasers
