“Woke.” An inescapable, four-letter boogeyman that has, over the past decade, infiltrated every corner of cultural discourse. The earliest modern print definition of the word can be found in a 1962 New York Times article where Black novelist William Melvin Kelley defined somebody to be “woke” if they were “well-informed, up-to-date (1).” However, the word’s usage as an in-group signal encouraging Black people to recognize and remain vigilant against oppressive systems can be traced as far back as the 1920s (2).

 

In 2014, the word emerged into mainstream American lexicon as the Black Lives Matter (BLM) movement was thrust into global prominence following the police killing of unarmed Black teenager Michael Brown. “Stay woke” became a rallying cry for the movement, and the word “woke” became a signifier of the progressively enlightened.

 

Yet over time, the word’s roots seemed to warp and lose meaning. What began as a call for awareness instead morphed into a right-wing pejorative – a catch-all for excessive political correctness, virtue signalling, and performative activism. Today, “woke” has become its own undefinable beast. From female superheros to black Disney princesses, from affirmative action to beer commercials, both everything and nothing is “woke.”

 

Initially, this witch hunt for “wokeism” seemed confined to internet crusades and fiery political speeches with little legal or corporate consequences. However, recent developments suggest this crusade is bearing real-world repercussions.

 

On November 25, Walmart Inc., the world’s largest retailer, announced a sweeping rollback of their company's diversity, equity, and inclusion (DEI) policies. The changes include curbing racial equity training, ending data sharing with LGBTQ+ advocacy group the Human Rights Campaign, discontinuing the use of terms “DEI” and “Latinx” in official communications, removing demographic data considerations when awarding supplier contracts, and winding down its Center for Racial Equity (3). 

 

For many, it may be tempting to try and dismiss Walmart as an isolated event in the corporate world. However, looking at a broader picture seems to possibly signal a greater shift in the American sentiment.

 

The Rise of DEI

 

To fully understand the repercussions of Walmart shuttering its DEI policies, it is essential to revisit the context in which they emerged. In 2020, amidst nationwide BLM protests following the murder of George Floyd, Walmart pledged $100 million to advance racial equity, establishing its Center for Racial Equity as a hub for funding initiatives aimed at addressing systemic inequalities. 

 

On the one-year anniversary of Floyd’s death in 2021, Walmart CEO Doug McMillon released a statement acknowledging public concerns that their concern to addressing inequality might fade over time. He vowed that Walmart “can’t let that be the case” and called on other companies to join them in addressing “systemic racism and the structural inequities that are rooted in this nation’s history of slavery and that persist today” (4). Four years on, that no longer seems the case.

 

At the time, Walmart was not alone in its efforts. Major corporations across America from Coca-Cola to Nike were announcing new sweeping DEI policies. Facing intense public scrutiny, businesses quickly aligned themselves as allies to the social justice movement, eager to ride the progressive wave that was defining the cultural climate.

 

Adopting DEI policies was arguably less a moral stance for these companies as it was a strategic one. Gen Z, with its liberal-leaning sympathies, was emerging as a major market force, and public sentiment demanded accountability and reform.

 

Looking to the legal front, in 2020, Donald Trump signed an executive order to combat “race and sex stereotyping and scapegoating” to set the stage for sweeping attacks on DEI policy (5). In January 2021 on his first day in office, Biden rescinded the order and passed his own “​​advancing racial equity and support for underserved communities” (6). With this one move, Biden adjusted White House policy in a sharp 180-degree turn, helping forecast the four years to come.

 

In 2020, America voted out conservatism and embraced progressivism. To maintain public favor and protect their bottom lines, major corporations had little choice but to follow suit. After all, businesses arguably are always profit-driven, and as such, would rather act not as a force of leading change but rather a reflection of the prevailing American sentiment.

 

Go Woke, Go Broke

 

Yet by 2023, America no longer seemed so blue. The phrase “go woke, go broke” had emerged as a rallying cry for conservative critics pushing back against progressive corporate initiatives. Any brand perceived as catering to “woke” ideals found itself in the crosshairs and what began as internet outrage morphed into a high-profile series of consumer boycotts.

 

Perhaps the most prominent case was Bud Light. In April 2023, Anheuser-Busch partnered with Dylan Mulvaney, a transgender influencer, for a single social media promotion. The backlash was swift and severe as calls for a boycott swept through conservative circles, leading to a measurable drop in sales. Within weeks, Bud Light lost its status as America’s best-selling beer, and Anheuser-Busch lost over $27 billion in value following the controversy (7).

 

In May, Target also found itself facing a similar battle as calls for boycotts emerged for its displays and products tied to Pride Month. As a result, its second quarter sales fell by 5.4 percent (8). While still a comparable drop, it was much less extreme than the one faced by Bud Light as Target reported higher profit margins than analysts expected despite the sales decline. A possible explanation can be found in differing consumer demographics, as Bud Light’s skews conservative and would produce a stronger reactionary pushback.

 

These incidents seemed to confirm the notion that embracing “woke” ideals was bad for business. But was the backlash truly reflective of the broader market? A closer look suggests otherwise. 

 

A global study performed by Unstereotype Alliance found that inclusive advertising campaigns led to an almost 3.5% boost to short-term sales, and more than a 16% increase in the longer term (9). Additionally, on the side of internal company diversity, a McKinsey & Company report discovered that companies with diverse executive teams consistently achieved higher financial returns than less inclusive competitors (10).

 

Seemingly what the Bud Light and Target cases revealed was less a widespread economic rejection of “wokeness” and more a growing boldness in the vocal minority’s ability to drive online outrage. As such, during 2023, most corporations did not roll back their DEI commitments or inclusive policies as the consensus of the period was that the majority of American consumers had not fully rejected progressive values. Diversity was still paying dividends, but a seed had been planted.

 

A Legal Battle

 

Just a few months after the Bud Light scandal, the Supreme Court struck down affirmative action on June 29, 2023 , effectively ending race-based considerations in college admissions (11). While the ruling applied specifically to higher education, it has since provided a legal framework for conservative groups to challenge corporate initiatives aimed at addressing inequality.

 

Organisations like the American First Legal Foundation, co-founded by former Trump officials, have since taken the opportunity to file more than 100 legal actions against “woke” companies with DEI-focused hiring or promotion practices, alleging that such policies constitute unlawful discrimination against white men (12). Assessing the success rate is difficult as the Equal Employment Opportunity Commission (EEOC) does not publicise which complaints it actually investigates, and the lawsuits may be less about winning in court and more about creating a climate of fear within corporations.

 

Donald Trump’s election victory in early November has promised a further legal escalation against inclusivity practices. David Glasgow, the executive director of the Meltzer Center for Diversity, Inclusion, and Belonging, has stated that going forward the Trump administration is “likely to be the most virulent anti-DEI administration that we’ve seen” (13).

 

The Supreme Court’s ruling not only set the stage for this wave of legal challenges, but also provided a sense of legitimacy to conservative Americans that their anger and beliefs were not just finally being heard, but also embraced. After all, whether corporations hold their ground or retreat on DEI policies depends just as much or if not more on public sentiment rather than simply legal challenges.

 

In the Corporate Eye

 

Robby Starbuck, right-wing political commentator and activist, likes to claim full credit for Walmart’s DEI rollback. After all, he was previously responsible for leading companies like Ford, Harley-Davidson, Lowe’s and Tractor Supply to pull back their initiatives. His strategy follows a similar pattern: target companies with a conservative consumer base, expose the company’s commitment to diversity and inclusion or combatting climate change and threaten boycotts backed by an aggressive social media campaign until the company acquiesces and announces the elimination of DEI policies.

 

Walmart, however, was different. There was no highly publicised online social media campaign. While Starbuck and Walmart supposedly had discussions behind the scenes, the general public was left unaware. Most importantly, reports indicate that the retailer had already begun scaling back its inclusivity efforts before Starbuck ever entered the picture. For example, in the previous year, Walmart started to phase out the term DEI by hiring a Chief Belonging Officer rather than a Chief Diversity Officer and began re-evaluating supplier diversity programs long before any external pressure surfaced (14).

 

As Starbuck gloated about the victory on social media, Walmart stayed silent, not putting out any form of press release. In a way, Walmart had been given the perfect cover to walk away from its DEI policies. By citing external pressure, Walmart could obscure a more significant truth: their retreat from inclusivity initiatives likely stemmed from the realization that such efforts were no longer as profitable as they once were.

 

Unlike Starbuck’s previous targets, Walmart’s consumer base does not clearly skew either left or right. It has stores in every single state and serves over 230 million customers per week. As a result, for decades, Walmart has reflected the values of the average American. Walmart likely could weather through boycotts from a vocal conservative minority. That Walmart chose to roll back DEI regardless suggests a possible broader cultural shift. Skepticism toward “woke” ideals may no longer be confined to fringe groups, but rather instead permeated into mainstream culture. 

 

Walmart’s decision sets a powerful precedent. When the world’s largest retailer recalibrates its strategies, others are bound to follow. This shift, however, is not about ideological alignment but rather profitability as corporations continue to mirror consumer preferences. When DEI policies aligned with public sentiment, companies easily embraced them. However, for such a profound victory in legal and political fronts on eliminating DEI to occur, a greater turn in the American culture tide needs to be fueling these changes and battles. As such, corporations have little to do but follow suit.

 

For Walmart and others, the decision to pivot away from DEI reflects not just a reaction to boycotts or legal challenges, but an anticipation of where the American public sentiment, and their wallets, are headed next.