Late GAP Can Defeat The Fast Fashion Brand ZARA

"If you don't come, you will be wrong, but there is no" coming late. " Yang Deming, President of GAP Group China, described the company's new decision.

The largest in the United States. Chain apparel retailers At the end of June, it announced that it had expanded its territory to China. The pioneer force was the largest brand GAP of the group. Now it has a Chinese name, "Gapu".

In Shanghai and Beijing, four shops are being renovated. Shanghai's two are in the Huaihai middle road Hongkong square and Nanjing West Road Shimen intersection, Beijing's two are in Wangfujing APM and north facing Joy City.

become pregnant GAP Huaihailu Road and Wangfujing seem to be more like the highstreet of the United States or Britain: GAP, ZARA, H&M... These brands always come together. Even the new competitors of GAP in recent years and the AmericanApparel with a strong American style have been stationed in Huaihailu Road. The fact is that GAP is really late.

Whoever comes late will have to pay a higher rent. This is one of the reasons why GAP can only open four stores this year. Good market has been occupied by peers. It is not easy to find the right store.

In fact, about eight or nine years ago, GAP had already appeared in China. At that time, there were GAP counters in some shopping malls in China, but only wholesalers sold them in the form of franchising. Only more than 100 square meters of venues were able to display a very small number of products, and the difference between real shops was very large. Those counters did not operate for too long before they were closed. But this time, GAP is playing the game. It has dug up its China President Yang Deming and Lorenzo Moretti (LorenzoMoretti) from best buy and Tesco. The two were respectively the president and managing director of GAP China, and also appointed the chairman of Standard Chartered Bank, Greater China, Ceng Jingxuan as a board member. The new heavyweight team shoulders the most important plan of the whole group in 2010: opening up the Chinese market.

Unlike H&M from Sweden and ZARA of Spain, GAP has a very large local market, which has focused most of its efforts on the US in the past more than 40 years. At present, the international market accounts for only 19% of the total sales of GAP group. But the big domestic market in the United States is still saturated after all. "We can't open one thousand more stores in the United States. The new space is definitely outside North America." Yang Deming said.

GAP is not just aware of this, but the continuous decline in performance over the past few years has left it too busy to explore overseas markets. Starting from a loss of $3 billion 200 million in 2002, it was not until 2008 that it was grabbed by the Inditex group of ZARA, the world's largest apparel retailer. Overseas expansion was more than enough for GAP. In the first half of this year, the profit margin of GAP increased by 40 percentage points compared with the same period last year. After the downturn of the economic crisis, such figures were not eye-catching, but at last it was able to put the plan into practice: in this year, China and Italy entered the market, while China is the top priority.

GAP has been with China for over 20 years, and, like its peers, it also regards China as one of its production bases. Before entering China, GAP has purchased over 10 billion US dollars from China, and about 300000 workers from more than 400 factories have produced 30% products for GAP.

Now, this is gradually changing from the world factory to the world market.

Therefore ZARA As early as the eye-catching position of major business circles in Shanghai and Beijing, 33 of H&M's 86 new stores opened in China in the first half of this year, so UNIQLO opened the world flagship store at Shanghai Nanjing West Road subway. For GAP, the six products of men's wear, women's wear, maternity dress, children's wear, baby's wear, underwear and home furnishing are all displayed. The area of each store is 1100 square meters to 1500 square meters.

Besides the high cost of shops, the production and logistics cycle is also a problem. From clothing design to physical objects, ZARA takes 12 days, H&M takes 21 days, and GAP takes 90 days. But GAP is not worried on the surface, and its quick response to fashion and popularity is not its selling point. Yang Deming doesn't even think of himself as a fast fashion brand. "People need casual clothes after work, fashionable clothes on Party, and high quality clothes to wear at work. We have good fabrics and workmanship, and fashionable and practical design. People need our stuff. "

To put it this way, it is more fashionable and more sense of design, which is what GAP has been hoping for in recent years. A few years ago, you could describe GAP>>'s clothing with "comfortable, nice looking, no mistake, but no personality". In the tenth season of the American drama Friends, there was a passage: Ross found himself and Rachael's little boyfriend bumping into a shirt, and could not help shouting: "StupidGAPoneverycorner!" shops are everywhere, customers are everywhere, but the style is not rich enough, so it is very easy to crash shirts.

Ross complained about GAP when it was 2004. It was only two years before CEO PaulPressler (PaulPressler) decided to change the design of the entire brand in 2004. It still can not see any effect. But now the GAP has already backed up by the big designer, the lineup is quite strong: the shoes designed by the French shoe master PierreHardy, have children's clothes designed by StellaMcCartney, and the latest designer of the season is the hot Chinese designer AlexanderWang, who has designed a series of clothes priced at less than US $100 for GAP.

Although GAP pays more attention to design than ever before, it is not as popular as its peers. Compared with last year's thousands of people queuing up to buy JimmyChoo's cooperative shoes at the gate of H&M at Huaihai Middle Road, GAP's performance was simply low-key: when it launched the women's shoes series designed by PierreHardy, there was no shoe box, shoes were packed in spanparent plastic bags, only DesignerCollection was printed on the bottom of the blanch, and even the name of the master was not mentioned.

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"We do not pursue the effect of more than 1000 people queuing on the first morning." Yang Deming said, "usually we sign a year with designers, not just for a while, but we need to do business in a long way."

More design details are hidden where consumers may not notice. Careful subdivision size has always been the distinguishing feature of this brand. In the case of jeans, in addition to the American version 8 and No. 10 (corresponding to European version 38 and 40), there are three letters, A, R and L, which correspond to shorter, normal and longer trouser legs, which are convenient for waistline and hip circumference. However, guests with different height proportions choose the trousers that best match their figure. If you look at the official website of GAP, you will find that the women's clothing department is divided into two parts: Petite and Tall. Even the same size of the same dress, the small size and the large size will have different designs in the body, sleeve, crotch, crotch and so on.

In China, GAP intends to further emphasize this subdivision. They have arranged specialized teams to research and design local consumers, and design some suitable local styles for the East and West and the north and South markets. I hope this example will not offend readers from different regions, but it may be more clear: under the same height, Chongqing girls have short waist and long legs, while Shanghai girls have shorter waist length legs, so long T-shirts are more suitable for sale in Shanghai, while short ones will be more popular in Chongqing.

This is a price sensitive market. H&M sells jeans to 99 yuan, and UNIQLO T-shirts rarely exceed 100 yuan. To fight price wars, the space left for GAP is already small. In fact, in Europe and the United States, the price of GAP is slightly higher than that of the other ones. Especially after the 2002 Paul Preiss cut the whole product of less than $20, the market positioning of GAP brand has a subtle improvement: it still looks like it is still in the high street parity Army group, but the price is getting closer to BananaRepublic, which is the main high-end business route of J.Crew, RalphLauren and GAP group. In the Japanese and Korean markets, the price of GAP is higher than that of the European and American markets. It has changed from civilian brand to quasi major brand. Usually, a pair of jeans will be sold for more than 100 dollars.

For the Chinese market, GAP emphasized that he had never taken the high margin route, and 30% of the products were produced in China. According to the principle of "setting the retail price at a cost," the price would not be too high. Yang Deming told the first financial weekly that although there is no specific pricing at present, the price in China should not be much different from that in the United States, which is cheaper than in Japan and Korea. In addition, there will be so many kinds of clothes for sale, each with more sizes than others, and the inventory must be very high. When it is necessary to make room for new storage, the old money will be sold at a discount like abroad.

Whether it's expensive or not, it's the man who walks into the store with his wallet has the final say. GAP product series is comprehensive, trying to please everyone, but this kind of location that wants to take care of the whole family is easy to appear widely and obscure. Fortunately, this problem has nothing to do with the Chinese market. Here, the age of consumers is positioned between 25 and 35, and may fluctuate slightly, but generally speaking, it is clear.

For this group of people, online shopping is just as important as physical store shopping. When the first batch of four stores in China is being renovated, the online sales platform is being built, and the shop will open at the same time with the entity store before the end of the year. Among competitors, in addition to UNIQLO, the other few have yet to sell Internet sales, and GAP, which has no advantage in the market and rent, obviously wishes to make a difference in the online store business. Even in 2008, when the sales volume of the entity stores was frustrated, GAP's global network sales exceeded $1 billion.

GAP group made a big money to let GAP brand enter China, which is only the forearm of the whole group. In the first tier cities to gain a firm foothold and penetrate into the two or three tier cities, it also hopes that other brands such as BananaRepublic and OldNavy will also enter China. According to its China plan, this year is Shanghai, Beijing, next year is Hongkong. In 2012, it will be able to enter the second tier city. By 2015, the Chinese market will surpass Japan and become the second largest market outside GAP.

This plan looks familiar, but ZARA, H&M and UNIQLO are already taking the second step. The long delayed GAP needs to have a more competitive strategic development model if it wants to go smoothly and smoothly, but even if it is global, it seems that it has yet to find a solution.