The Real Risks the DEI Retreat Poses to Marketers

The advertising industry is at an inflection point, grappling with the fallout of a shifting political landscape.

Since the reascendancy of president Donald Trump, brands that once championed diversity, equity, and inclusion are now retreating, with Target, Meta, and Walmart among those pulling back efforts. In response, activists are calling for boycotts, warning that companies abandoning their DEI commitments may be underestimating the long-term impact. 

Meanwhile, brands like Ben & Jerry’s, Costco, e.l.f. Beauty, and Delta have remained steadfast in their commitment to inclusivity, recognizing that their future consumers—Gen Z and the rapidly emerging Gen Alpha—care deeply about these values. 

History has shown us how quickly societal trends can shift. In 2020, DEI initiatives were widely publicized, with companies pledging to increase minority representation, invest in Black-owned businesses, and overhaul internal policies. Yet, just as swiftly as DEI was championed post-2020, it is now being cast aside. We saw the same pattern with Covid-19: mass adoption of hygiene and vaccine protocols, followed by a rapid return to pre-pandemic behaviors.

Trump’s new presidency will last four years, but times change; what will come next for brands that are abandoning internal and external DEI advocacy? As divided as the electorate is, the next administration could swing public sentiment back toward DEI and corporate social responsibility. If that happens, brands that retreated from inclusivity may find themselves on the wrong side of history, struggling to regain consumer trust. 

Business risks 

Gen Z and Gen Alpha are like elephants—they don’t forget. Gen Alpha, poised to be the largest consumer group in history, will soon be making purchasing decisions. Brands pulling back DEI efforts to appease today’s political climate may find themselves abandoned by the very consumers they once sought to attract. 

Take Target, for example. Historically, the company has been known for inclusivity, yet it recently announced the discontinuation of many DEI initiatives, including its Racial Equity Action and Change (REACH) program, which aimed to invest over $2 billion with Black-owned businesses by the end of 2025.

This decision comes despite a significant portion of its customer base consisting of people of color, women, LGBTQ+ individuals, and people with disabilities. By walking away from DEI, Target risks alienating its core demographics, potentially handing an advantage to competitors who maintain their inclusivity efforts. 

The data supports this risk. Younger generations overwhelmingly prioritize brands that align with their values. A 2023 McKinsey study found that 45% of Gen Z consumers stopped purchasing from a brand whose values did not align with theirs. The potential short-term gains of stepping back from DEI—appeasing conservative stakeholders, aligning with the political climate, or avoiding backlash from opposition groups—might be outweighed by long-term reputational damage. 

Representation risks 

These changes don’t just affect policy, they shape who we see on our screens. There is a segment of Trump’s base that would like to see advertising reflect a more homogenous America, fewer diverse faces and LGBTQ+ narratives, and more “traditional” imagery. This year’s crop of Super Bowl ads attested to that. This presents a challenge for advertisers: How do brands balance this pressure while continuing to represent the reality of an increasingly diverse and socially conscious consumer base? 

As a Black female agency owner, I’ve had to face the reality of these shifting tides. Recently, we’ve reconsidered how we position ourselves, stripping our materials of overt references to being Black- or female-owned. Instead, we’re doubling down on our unique value propositions—because we do have value that stands on its own.

This isn’t about distancing ourselves from our identity, it’s about ensuring that our work is judged on its own merits and not misinterpreted as needing a hand up. Our mission remains the same, but in the current climate, the best way to serve that mission is to continue thriving as a business. Because let’s not pretend that being Black and female hasn’t historically meant less access.

DEI was never about handing out unearned opportunities; it was about handing companies like mine the proverbial mic. And even when you get the mic, it doesn’t mean you won’t be drowned out by the friend of a friend of the client—often white, often male, and often with an offering far less special than yours. We all know the third-bid phenomenon: being invited to pitch not because you’re a serious contender, but because the client needs to check a box. 

DEI was never foolproof, but it at least increased the number of at-bats for agencies like mine. The notion that unqualified companies were handed contracts due to DEI is a fallacy; what happened was that minority-owned businesses simply got more opportunities to prove their worth in an industry that has long favored entrenched, homogenous networks. 

The advertising world is threading a needle right now. Agencies like mine are working to stay true to our DNA while not appearing “too other”; if a brand assumes that a diverse agency’s success is tied to DEI rather than its capabilities, the agency can be deprioritized when DEI falls out of favor.

We must recognize that these societal shifts are cyclical. The companies that abandon DEI today may struggle when public sentiment inevitably swings back. The question for brands isn’t just how to navigate today—it’s whether they’re prepared for what’s next.