Gap And Old Navy'S Ice And Fire Days

Brand Gap has gone wrong. What should it learn from its own brother Old Navy?

One day in September, a mobile display bus of the US brand Old Navy stopped at the gate of the 800 Show of Shanghai creative community.

Inside the bus is a variety of tannins from Old Navy, from shirts to jackets.

There are splicing patches, designer sketches, and fashion designers explaining the most popular tannin dressing rules.

In the background, the wall reads prominently, "we believe in We believe in the democracy of style".

"It all reminds me of Gap 10 years ago."

Pan Ning, who studied at University of Pennsylvania, said at the scene.

As a low-priced brand of Gap, the Old Navy entered China formally in March 2014.

But now its popularity seems to have gone beyond the unknown brand Gap.

"Gap is old. It's not cool."

He added.

This year, the Gap group has undergone a series of management changes, including the resignation of the chairman and CEO Glenn Murphy, who worked for 7 years in February.

This series of changes may stem from the dismal performance of Gap.

The Gap group's earnings figures are indeed disappointing.

In August, Gap's same store sales fell 8%, which is the sixteenth consecutive month of decline.

Its high-end brand Banana Republic is also facing a declining trend, and the same store sales decline has expanded to 11%.

Only Old Navy still maintained a good momentum. The same store sales grew by 6%, compared with 2% in the same period last year.

It is because of the support of Old Navy that Wall Street has no opposite to this company.

But there is no doubt that Gap has been on the decline.

A statement from its San Francisco headquarters said that in the next few years, the company will close 175 stores in North America and lay off about 250 people from headquarters to reverse the decline in sales.

Owen Shapiro, a retail analyst, believes that Gap has made many mistakes after its success.

On the contrary, the consumption concept of young people is endless.

They are easy to be tired of a brand and easy to follow suit.

Just like the decline of Levi's and the entire cowboy category, one of the problems of Gap is also that it has not been able to create the trend of keeping pace with the times to attract young consumers.

The heavy use of social media in the fashion industry exacerbated the process.

"Today, everyone can notice the trend of popularity on the Internet, everyone is a critic, and the brand like Gap will be very outdated."

Luxury accessories website The Editorialist co founder Kate David Hudson told reporters.

Gap's khaki trousers, jeans and shirts used to be the classics of American popular fashion, but now it is no longer the first choice for consumers.

As a brand of the same group, the price of Old Navy is much lower than that of Gap and Banana Republic.

It costs only 30 dollars for a man's jeans.

In September last year, Michael Barnes, general manager of Old Navy, told reporters that Old Navy is a more approachable brand than the traditional fast fashion brand that consumers are familiar with.

In China, it takes the family line, emphasizing that only 300 yuan is needed for every family member to find suitable tannin products.

The competition between fast fashion brands seems to be tilting towards the "cheaper than" direction.

The expansion of Primark illustrates this point.

Its selling price in the US market is 20% cheaper than Forever 21, 33% lower than Old Navy, 40% lower than H&M, and sales capacity per unit area surpasses all fast fashion brands and department stores own brands.

Erwin Penland, chief planning officer of Erwin Penland, expressed his view on commercial website Business Insider: a simple plan can make Gap return to the root, that is, close to the price of the public.

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The emergence of Old Navy is just to make up for the competitive disadvantage of Gap group in price.

In 1990s, when Gap upgraded its brand positioning to the middle end market, it was far away from the original intention of "popular fashion".

The Old Navy, which goes on the pro democracy route, has gradually surpassed Gap and has become the most profitable brand of the group.

Low price is not the whole of Old Navy.

If you have been to the new store of Old Navy, you may see such a scene - hanging around the Hollywood type five pointed star billboard, which reads a big "Now Playing" (playing it) or a flash announcement enclosed by a light bulb: "Hundreds of New Arrivals (hundreds of new goods arrived)!" the staff dressed as clowns distributed candy to the children.

By the way, you can also get coupons in the form of darts.

"Maybe in many brand stores, children are considered to be only a barrier to shopping, but in Old Navy, I want to see adults and children relax. Old Navy is a place for families to enjoy shopping together."

Barnes said so.

This idea comes from Stefan Larsson, President of Old Navy. In September of this year, the father of Ralph, who had just announced her retirement, chose Ralph as her successor and became the CEO of the same name luxury brand.

He believes that the so-called low price brands on the market are always selling clothes by the pound, which has a big problem, that is, ignoring the mood of consumers.

Mizuho Securities analyst Betty Chen told reporters: "Old Navy used to be just selling clothes, but Larsson brought more fashionable clothing and marketing strategies, which all had a strong aura effect and improved the brand image."

In the past 3 years, under the leadership of Larsson, Old Navy has undergone an amazing pformation.

Last year, sales of Old Navy in the US were close to US $6 billion, accounting for 40% of the group's total revenue, almost equivalent to the sum of two brands of Gap and Banana Republic.

In 2012, Gap group dug its Stefan H&M, the sales director from Stefan, and gave him the challenging brand Old Navy at that time.

Prior to that, Larsson has worked in H&M for 15 years, responsible for H&M expansion and its 2300 store businesses.

At that time, compared to the new fashion jacket of H&M show, Old Navy's casual wear became less attractive.

The recession has also led to a sharp decline in clothing spending, even though the low price brand Old Navy has been hit.

Between 2006 and 2008, sales of Old Navy fell by more than $1 billion.

After coming to Old Navy, Larsson set up an elite team to hire Coca-Cola Ivan Wicksteed, the former creative director of the brand as the marketing director of the brand. She also invited the designer from Coach to invite sportswear designers from Nike to invite the director of menswear design from The North Face.

The starting point of all this is not to make products look cheap.

These people have changed the way Old Navy designs garments.

Previously, suppliers of Old Navy would buy clothes from places like Sax's boutique and A&F, and pick a few of them, which are usually very clumsy in Navy.

But in the past two years, Old Navy has developed its own design power. The single product has also shifted from the daily and basic funds to a more fashionable and fashionable fashion.

Pixiepants, known as the "goblin", is the victory of Old Navy so far.

"We used a unique design and then put it into the market to test how customers react to it.

Last year, we sold 2 million 400 thousand of these styles of trousers, "Larsson said." this is one of the costumes that bring us benefits.

Now, Old Navy is looking for the next product that can be sold.

Sports wind swept the fashion world, yoga pants instead of jeans became popular single products.

This year, Old Navy has also launched sportswear and has invested heavily in high-performance fabrics.

However, price is still the advantage of Old Navy.

Buying a pair of yoga pants at Lululemon can buy a sportswear for the whole family at Old Navy.

The outdated Gap is struggling to keep up with the times, at least not to lag behind Old Navy.

In the autumn and winter advertisements of 2015, it abandoned the celebrity route, and let Liu Wen and other international supermodels display Gap clothing before a plain background.

This looks a bit like UNIQLO's usual practice.

But this strategy has not been successful in Gap, and sales have been declining in the next few months.

Gap's khaki trousers, jeans and shirts used to be the classics of American popular fashion, but now it is no longer the first choice for consumers.

Now, Gap employs Wieden+Kennedy advertising agencies to implement new marketing plans, and wants to keep up with the current normcore trend.

The word "normcore" is created by the trend prediction agency K-Hole, combined with normal (usual) and hardcore (core), which means to do the most basic collocation and "seek freedom from the commonplace."

Don't think you can just wear a UNIQLO T-shirt and a Gap jeans. Most of the time, normcore refers to MUJI's "cold air" and C's line style.

In contrast, the design of Gap can only be reduced to "featureless dressing".

Isha Aran, author of the feminist fashion blog Jezebel, sums up Gap's mistakes - the so-called normcore is just the cliche of the basic model.

It is also much more clever to sell clothes to everyone's UNIQLO, which is much cheaper, and is in line with people's psychological expectations for basic funds.

More importantly, although it's basic, there are dozens of high tech fabrics that can be selected when you want to pursue them.

At the same time, it also provides a medium price designer cooperation series.

The new CEO Art Peck of Gap group, which took over Murphy in February this year, is facing severe challenges to save Gap.

The first is the accountability design team.

Before taking office, he sacked the creative director Rebekka Bay, who was excavated from H&M in September 2012, and hired Wendi Goldman, which was responsible for the Pink design work of the Victoria's Secret sub line, to lead the product design and team development of Gap.

During the period of Rebekka Bay, she made great innovations in the design of Gap's dress, making them more self-contained and colorful.

Her series seems to make the circle more exciting: white floral shirt skirt, printed cowboy motorcycle jacket, striped nine pants.

Her works are even compared with Jenny Holzer's "general" series T-shirt.

But this has not significantly affected brand sales data - Gap has not changed in 10 years.

Reshaping the supply chain to make Gap "faster" is the core of the new CEO pformation plan.

His goal is to shorten the cycle of Gap products from design to store to 30 weeks.

The current cycle is 10 months, about 3 times that of ZARA and H&M, because Gap does not own its own factory.

Although it is also known as ZARA, H&M and UNIQLO as the four fast fashion brands, the speed of Gap is still different from that of them. Finally, the position of the clothing group has been handed out.

Old Navy, which is called "goblin" pants, also shows people a new and flexible mode of production that Gap may have in the future. Before large scale production is launched, market demand for small batch of commodity testing is first introduced.

This fast strategy may be the reason why Old Navy overtook Gap.

Over the past 3 years, Old Navy has performed well, not only in sustained growth but also in good surpluses.

"Old Navy is more aware and effective in finding industry trends and actions."

The new CEO Art Peck made an evaluation of the group's top three brands in the performance conference call earlier this year, "Banana Republic is in the middle, and Gap is lagging behind."

In the future, he will take the success of Old Navy as an operation template to reverse the fate of Gap and Banana Republic, especially the women's clothing business.

But almost 10 years later.

Can it be cool?