Retail

As Black buying power grows, racial profiling by retailers remains persistent problem

Key Points
  • George Floyd's killing has sparked a national conversation not only about police reform, but also about the everyday places where Black Americans face discrimination.
  • For more than two decades, Black Americans have been most likely to report unfair treatment while shopping, according to a Gallup poll.
  • Black consumers, however, skew younger than the median American consumer and their spending is projected to grow significantly in the years ahead, according to data from Nielsen.
  • Industry watchers and activists say that racial profiling remains persistent and retailers must do more to examine how they treat and cater to Black customers.
Lorenzo Boyd, an assistant professor, director of the Center for Advanced Policing and vice president for diversity and inclusion at University of New Haven.
Source: Lorenzo Boyd

Lorenzo Boyd was in the market for a new car and wanted to buy a luxury SUV. He went to a Lexus dealership and walked through the lot, expecting the unoccupied salesperson to run over. But that didn't happen.

After asking for help, the salesperson was slow to approach Lorenzo and when he did, he steered him to a cheaper model.

"I remember the guy told me, 'Are you sure you want this one? This one's a little pricey," Boyd recalled.

Boyd, a 50-year-old criminal justice professor and vice president for diversity and inclusion at the University of New Haven, said that scenario is one that has played out many times — not only for him, but for many Black Americans when they go to the coffee shop, make a trip to the mall or browse the aisles of a grocery store.

Getting snubbed by a salesperson. Followed and looked at suspiciously by a store employee. Hassled by security — and in some cases, reported to police.

The killing of George Floyd, which began with a retailer's 911 call, has inspired protests and a push for police reform. It's prompted a closer look at the everyday places where Black Americans face discrimination — not only in interactions with police, but at the workplace, grocery stores and shopping malls.

In recent weeks, retailers have joined Corporate America in condemning racism in messages and pledging to expand their diversity efforts with their recruiting and training efforts and beyond their four walls. Among them, Walmart said along with its foundation, it will invest $100 million over five years to create a new center on racial equity. Nike released a TV ad as protesters filled streets in many U.S. cities, that told viewers "For Once, Don't Do It... Don't pretend there's not a problem in America." A major industry trade group, National Retail Federation, said it's forming a diversity work group to look for solutions. And retailers, from TJ Maxx and Gap to Victoria's Secret have prominent messages on their websites about their efforts to fight racial injustice.

Yet retail environments are one of the places where Black Americans say discrimination is prevalent, even as Black buying power grows. Industry watchers and activists say that problem remains persistent and retailers must do more to examine how they treat and cater to Black customers.

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A persistent problem

For more than two decades, Gallup has surveyed Black Americans about the places where they've faced discrimination. In each of the polls since 1997, Blacks have been most likely to report unfair treatment while shopping. 

Nearly 30% of Black Americans said they were treated unfairly because of their race when shopping in the past 30 days, according to the 2018 Gallup poll, the most recent data available. That's higher than the percentage of Black Americans who reported recent mistreatment in dealings with police, at the workplace, in a health-care environment or at a restaurant or other entertainment place during that same period.

Fifty-nine percent of Black Americans said in 2018 that they are treated less fairly than Whites in stores downtown or at the shopping mall. Notably, that percentage has gone up in Gallup polls over the years.

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The experience is so widely shared that Black Americans and academics have a term for it: "Shopping while Black."

Cassi Pittman Claytor, an assistant professor of sociology at Case Western Reserve University, studies contemporary forms of discrimination with a focus on middle-class Blacks.

She said salespeople, store security guards — and even company policies — can reinforce inaccurate stereotypes that Black customers are more likely to steal or can't afford high-end items.

Her research has shown that money is not an equalizer for Black Americans when they walk into a store, even if they have a high income, work on Wall Street or attended elite schools.

"It doesn't matter how much money you have, what your credentials are," she said. "Your prestigious credentials don't garner you any additional respect. When you walk into a store, you could still be treated like a criminal."

She said it's a problem she not only studies — but knows personally. Her aunt stopped shopping online at one luxury retailer after visiting a store and being ignored. Her husband feels out of place when shopping alongside predominately White customers at Whole Foods. And her brother only shops at certain stores with specific salespeople, so he gets good service.

"If you get a Black family together, everyone will have those types of experiences," she said.

Boyd, the professor and administrator at University of New Haven, said the coronavirus pandemic has exacerbated challenges for Black and minority shoppers, particularly young Black men. Some retailers already viewed them with suspicion, he said. Now, he said, they may face even more racial bias as they walk into a store wearing a mask. 

"That adds a whole level of discomfort for certain people," he said.

Pedestrians walk past an Urban Outfitters store in San Francisco, U.S., on November 18, 2016.
David Paul Morris | Bloomberg | Getty Images

Code names and locked shelves

In the past few weeks, some retailers' business practices have sparked backlash and policy changes.

Urban Outfitters responded to allegations of racial profiling after multiple former employees said on social media the store's staff would sometimes use code names, such as "Nick," "Nicky" or "Nicole," for customers suspected of shoplifting. They said the code names were disproportionately used to refer to Black shoppers. The practice was previously reported by the style news website affiliated with NBC's "Today Show."

Urban Outfitters confirmed that employees used "Nick" and similar names for potential thieves, but said in a statement to NBC's Today Style that "this policy was misused."

"We are deeply saddened and disturbed by the reports of racial profiling in our stores, and we profusely apologize to each and every customer who was made to feel unwelcome," it said in a statement. "Urban Outfitters absolutely rejects racism, racial discrimination, and profiling of any form, and we have revised our shoplifting prevention policy to eliminate the use of any code words."

The apparel retailer said it will also conduct a third-party review of store practices, recruit a more diverse workforce and have mandatory diversity training at its stores.

Anthropologie, which shares the same parent company, faced similar allegations. The company responded in an Instagram post on June 11, saying employees "have never and will never have a code word based on a customer's race or ethnicity."

"Our company has a zero-tolerance policy regarding discrimination or racial profiling in any form," it wrote.

Walmart, Walgreens and CVS kept multicultural hair care and beauty products, primarily sold to Black women, in locked displays at some stores, as products commonly used by White customers were in unlocked displays nearby. Those retailers have said in recent weeks they'll end that practice. 

Two years ago, a California woman sued Walmart for discrimination in federal court, saying she felt sad, angry and embarrassed to have to ask a store employee to unlock items she needed — including a 48-cent comb.

Walmart said in a statement that the products were locked in about a dozen of its approximately 4,700 stores and said the cases were intended to deter shoplifters from a variety of products, including electronics and personal care items.

"As a retailer serving millions of customers every day from diverse backgrounds, Walmart does not tolerate discrimination of any kind," the company said in a statement.

CVS said it's working with women and minority owned suppliers and it's expanded its textured hair and color cosmetics by 35% in the past year to add more items and brands for Black customers.

"We have a firm nondiscrimination policy that applies to all aspects of our business and our product protection measures have never been based on the race or ethnicity of our customers," the company said in a statement.

Walgreens said in a statement that it's making sure multicultural hair care and beauty products aren't stored in locked cases and said that "has been the case at a limited number of our stores."

Some advocates have pushed retailers to take proactive steps that make their stores and product lines more inclusive.

Aurora James, a creative director and fashion brand founder in Brooklyn, called on brands to devote at least 15% of their shelf space to products from Black-owned businesses. The percentage is intended to roughly correspond to the percentage of Black people who make up the U.S. population. So far, Sephora and Rent the Runway are among the retailers that have signed on to the effort, dubbed the 15 Percent Pledge.

Claytor said along with examining their assortment of products, companies should take a hard look at their company culture, staffing ratio on the sales floor and diversity of corporate employees in top roles like management or in board positions.

In beauty, for example, she said the discrepancy can be obvious when a brand or a store has numerous shades of light beige and just a few shades of brown. But it can carry over into other ways companies operate, too.

"Do your products meet the needs of diverse customers?" she said. "There definitely is room for improvement."

A customer wearing a protective mask carries a Moncler SpA shopping bag past an Yves Saint Laurent store on Rodeo Drive in Beverly Hills, California, U.S., on Tuesday, May 19, 2020.
Patrick T. Fallon | Bloomberg | Getty Images

A growing consumer base

Businesses should pay attention to how they treat Black Americans for another reason: They are a huge customer base and their influence in the marketplace is growing, said Cheryl Grace, senior vice president U.S. strategic community alliances and consumer engagement at Nielsen.

Black buying power was $1.4 trillion in 2019, according to the Selig Center for Economic Growth. That's higher than the gross domestic product of Mexico. It's projected to grow to $1.8 trillion by 2024.

That growth is outpacing White buying power. Between 2000 and 2018, Black buying power rose 114%, compared to an 89% increase in White buying power, according to Nielsen.

Black Americans also skew younger than the rest of Americans. About 54% of Black Americans are age 34 and younger, according to Nielsen. The median age of a Black American is 32. That's compared to the median age of 38 for all Americans.

That youthfulness means that if companies attract and cater to Black customers, they could shape a lifetime of shopping patterns.

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"The earlier you capture us as a consumer, the longer you're likely to have us," Grace said. "You get us at a younger age and you can keep us for decades."

She said companies should pay attention to Black consumers for other reasons, too. Among them, she said, they tend to be early adopters of new products, whether a new food item or clothing line. Younger and older Black adults outpace the total U.S. population in their use of apps and spend more time on smartphones and tablets than the total population using video, audio and social networking.

And as tech-savvy consumers, Grace said they're more inclined to share their thoughts on social media about all matters — including brands — whether for better or for worse.

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