All that glitters today is not Gilt. The online designer discount retailer Gilt Groupe is getting pushback from customers for their wildly popular partnership with Target to do a pre-sell on the Target designer collaboration lines designed by Tucker and Mulberry. The lines sold out in just minutes, but the fallout remains. Target is under fire for campaign contributions to a very conservative candidate in Minnesota, home to Target corporate headquarters. That association has now rubbed off on Gilt.
According to NBC NY, Target's campaign contributions totaling $150,000 to support Minnesota gubernatorial candidate Tom Emmer has riled Gilt shoppers who support the LGBT community. Emmer does not, being opposed to gay marriage. Gilt's CEO Susan Lynne responded to the company's critics saying that Gilt was not in any way involved with the corporate campaign donation decisions made at Target. As Elle blogs noted, there was an unusual and direct exchange of opinion between the everyday consumer and the CEO of a company.
The intersection of business and politics is always complex. On the one hand, the opportunity to support a pro-business candidate is attractive to any business. However, despite the freedom granted by the Supreme Court decision in the Citizens United case, there are still limits business owners and companies should be aware of. Angry consumers are another consequence all together.
Federal and state restrictions on campaign donations differ, as do the laws from state to state. In Minnesota, direct contributions to a candidate by a corporation are prohibited. What is legal, and what Target did, is to donate (in this case, $150,000) to a pro-business political action committee (PAC) called MN Forward. This PAC supports Emmer's candidacy. For its part, MN Forward presents itself as a bi-partisan, pro-business group.
Target is the real center of the backlash that has spilled over onto Gilt. On August 5, the Associated Press reported Target's CEO was working to repair some of the damage done by the contribution. Target CEO Gregg Steinhafel wrote a letter to employees which said, "While I firmly believe that a business climate conducive to growth is critical to our future, I realize our decision affected many of you in a way I did not anticipate, and for that I am genuinely sorry."
Disclosure is always a key part of campaign finance regulations. Under Minnesota campaign contribution law, MN Forward must disclose its donations. By August 10, according to FactCheck.org, the PAC has reported $1.2 million in funds. The AP adds that according to public campaign reports, other contributors to MN Forward include: Red Wing Shoe Company Inc., Best Buy Co., Pentair Inc., Hubbard Broadcasting Inc., Davisco Foods International Inc. and Polaris Industries Inc.
A final note. According to the AP, there is one other thing Target is known in its home state for supporting: the annual Twin Cities Gay Pride Festival.
- Target: Gilt Groupe Teamup Good; Doonan's Costume Couture Bad (BNet)
- Opinion, Citizens United v. Federal Election Commission (FindLaw Cases and Codes)
- The FEC and the Federal Campaign Finance Law (FEC)
- Election Campaign & Political Law (FindLaw)