Major retailers and types have driven $14 billion in revenue to Black-owned businesses since May 2020.
Within the last three years, Nordstrom, Macy’s, Sephora, Ulta Beauty and 25 others have partnered with nonprofit organization Fifteen Percent Pledge. The group asks firms to reflect the Black community that makes up 15% of the U.S. population by dedicating 15% of their shelf space to Black-owned brands.
Prior to taking the pledge, lots of the group’s current partners had lower than 3% of their shelf space dedicated to Black-owned brands. Now all partners are committed to attaining their 15% pledge over a 10-year contract.
“Let’s create a possibility to chart a path forward that is more inclusive and offers Black entrepreneurs who’ve been historically and systemically excluded a possibility to construct generational wealth,” said LaToya Williams Belfort, executive director of the Fifteen Percent Pledge.
Fifteen Percent Pledge has committed to generating $1.4 trillion in wealth for Black entrepreneurs by 2030.
Sephora was the primary multibillion dollar retailer to commit to the pledge, just two days after founder and Brooklyn-based entrepreneur Aurora James posted her call to motion in the times after George Floyd’s murder.
“So lots of your businesses are built on Black spending power,” James said in her Instagram post. “So lots of your stores are arrange in Black communities. So lots of your posts seen on Black feeds. That is the least you’ll be able to do for us.”
With that, the group launched in 2020 as a way for firms to support Black business amid an outpouring of corporate diversity, equity and inclusion commitments to shut the racial wealth gap that is still significant.
Calculations based on Federal Reserve data from March 2023 show that Black household wealth within the U.S. totals $6.25 trillion — or only 5% of white households’ total wealth of $115.65 trillion. Meanwhile, only 4% of America’s largest firms had successfully closed the racial pay gap in 2022, based on CNBC partners at JUST Capital.
Committing to alter, greater than two-dozen firms have “taken the pledge,” including 20 apparel and furniture retailers, three lifestyle publications — including Vogue & InStyle — and cannabis dispensary chain MedMen.
Feeling the impact
Over 625 Black-owned businesses and types have developed relationships with large corporations which have signed on to the initiative.
Christina Tegbe, founding father of African luxury beauty brand ’54 Thrones’ inspired by the richness, diversity, and culture of Africa and its people.
54 Thrones
“We launched in retail in 2020 with Nordstrom,” said Christina Tegbe, founding father of Black beauty brand 54 Thrones and partner of the Fifteen Percent Pledge.
For the reason that increased attention in 2020, the corporate has grown exponentially, Tegbe said.
“From 2016 to 2019 we had a cumulative four-figures in sales,” said Tegbe. “After May 2020 and with the work being done by 15 Percent Pledge, we saw ourselves having five-figure days.”
Tegbe said her company remains to be self-funded, however the pressure Fifteen Percent Pledge placed on retail to get your hands on and nurture Black-owned brands gave her company the exposure it deserved. 54 Thrones is now among the many Black-owned brands on the shelves at Sephora, Nordstrom, Credo Beauty and Gwyneth Paltrow’s company Goop.
In August 2022, Nordstrom piloted its first Black Business Month program by making a “Buy Black” pop-up market to spotlight brands like Tegbe’s and others it carries year-round. Strong support for the initiative generated $14 million in sales of Black-owned or founded brands at Nordstom in that month alone.
Trying to repeat its success, Nordstrom is launching a latest multi-city initiative on Friday. The pop-up will help promote Black-owned brands and move closer to the corporate’s commitment to deliver $500 million in retail sales from brands owned, operated or designed by Black and Latinx individuals by 2025.
“We really need firms which have a big economic footprint that wish to be more inclusive, and create a more inclusive society going forward,” said Williams Belfort.
Pushback against DEI goals
Corporate America has committed to supporting diversity, equity and inclusion, but recent pushback from lawmakers to limit corporate DEI initiatives makes it a tough field to navigate.
On Tuesday, a conservative legal organization sued Goal in Florida federal court on behalf of an investor, saying the retailer misrepresented the adequacy of its risk monitoring over LGBTQ-themed merchandise during Pride month.
The lawsuit is the newest legal battle between conservative legal groups and lawmakers against corporations with policies designed to higher support racial and gender inclusion.
Last week, Bud Light parent company Anheuser Busch InBev saw a major decline in second-quarter U.S. sales after boycotts from consumers who opposed an promoting partnership with transgender influencer Dylan Mulvaney.
Tegbe said the backlash is worrisome.
“It’s concerning,” she said. “The considered firms pulling back and wanting to do things behind closed doors.”
Despite her concern, Tegbe stays hopeful that nearly all of consumers wish to see and buy products by diverse founders.
“With any great change or revolution it needs to be done in a way that [companies] are unapologetically taking a stance,” she said.
The pledge’s executive director Williams Belfort said the proof of the initiative’s success is within the numbers.
“The information shows that giving opportunity to black entrepreneurs, driving revenue for retailers, and making a more robust economy is nice economics for us all,” she said.
