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When a retailer is caught slipping and there are receipts, it’s sometimes hard to get back in the public’s good graces.

H&M is an obvious example of this cultural practice: The retailer’s earnings have taken a huge hit just months after they released a recklessly racist ad featuring a Black child model in a “Coolest Monkey In The Jungle” hoodie. The world’s second-largest clothing retailer has piles of unsold clothes worth more than $4 billion after #Hoodiegate, Bloomberg reported.

With the extra merch not selling off shelves and racks, the retailer’s earnings are going down. But how further down will earnings go?

Well, H&M’s racist ad is still a topic of conversation despite its actions to move past the flub from January. Officials pulled out all the standard damage control moves: apology, diversity officer hire and a campaign to get more Black folks to help fix the brand. However, several folks are not with it, and the retailer had to close its stores in South Africa. It’s clear that H&M has offended so many folks with its recklessness.

The retailer is paying heavily after its mistake: operating profit fell 62 percent to the lowest level in more than a decade. Its stock plummeted to the lowest number since 2005, according to Bloomberg. H&M couldn’t even get rid of several t-shirts and jeans on clearance!

But the company is still trying to meet its full-year profit estimates, The Street reported.

Former fans of the retailer may be asking this question: Will H&M get that ‘ole thing back or will they be forever canceled?

Regardless of whether H&M wins back the public’s trust, recent events can serve as a lesson for all brands. The biggest one? Racist ads won’t fly.


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