What'S Wrong With Foreign Brand GAP?

In 2016, it ranked 177th in the Fortune 500 list, up 11 from 2015. Although the ranking of enterprises has increased, it can not conceal the embarrassment of declining performance.

When you go shopping, what kind of clothing stores do you often visit?

, HM,

...

Have you noticed the brand of Gap?

Similar to the first few brands, Gap is also one of the representatives of fast fashion. Its brand owns many brands such as Gap, Old Navy and Banana Republic. But now it seems to be faced with the embarrassment of being away from consumers. It shows that, in terms of performance, the third financial season recently released by Gap showed that they had not stopped the decline of their performance, and the net profit in the third quarter was 204 million dollars, down 17.7% compared to the same period.

As a consumer, how long have you not bought the Gap with the big brand Logo?

Decline in performance

Gap ranked 177th in the Fortune 500 list of the top 177th in 2016, 11 higher than in 2015.

According to Gap's latest earnings report, sales of all its brands in the third quarter were $3 billion 798 million, down 2% from the same period last year.

Sales of Old Navy in the same store, though gaining 3%, is still hard to offset the 8% decline in the sales of the main brands Gap and Banana Republic in the same store, resulting in a 3% decline in the group as a whole. This is the 7 consecutive quarter of Gap group's same store sales decline.

The first financial daily also published an article in February this year. The fast fashion brand GAP is not going to get up soon. Maybe it is going to drop the ditch. It has paid close attention to the decline of Gap's performance.

Although Gap's performance is also in the doldrums.

Its net income fell by 17.7% to $204 million in the fiscal season, compared with $248 million in the same period last year.

However, competitors who belong to fast fashion brands like Gap are much more beautiful.

Take Zara as an example, according to the earnings data released by its parent company Inditex, as of July 31, 2016, total sales in the first half of Inditex amounted to about 10 billion 500 million euros, an increase of more than 11% over the same period last year.

As a matter of fact, Gap group has been making various adjustments due to its persistent performance downturn.

In June 2015, Gap announced that it had shut down 175 poor outlets in North America, and at the same time, it had laid off 250 people at headquarters.

In the first quarter of 2016, Gap announced that it will close 75 Old Navy and Banana Republic stores outside North America.

In the recent earnings report, Gap also said it would close 65 stores.

According to the world clothing and shoe net, Sabrina Simmons admitted in a conference call after its earnings announcement that it needed to replan in addition to closing stores, and put more investment into attracting customers into stores during holidays.

In November 28th, reporters interviewed the company about the performance of Gap group and the adjustment of its stores.

However, it replied on the 30 day that it was difficult to respond because of the tense time.

Positioning embarrassment

"I feel that Gap is an American leisure brand.

However, it seems to be very casual, but it is not a special civilian brand. It seems that there is no sense of design in fashion. I don't like it, but I haven't worn it yet. "

White collar Miss Li said so.

Recently, reporters interviewed a lot of consumers, most of them think that Gap's products are "not giving strength".

A clothing industry analyst told reporters:

Compared with Zara, HM and other brands, the advantage of Gap is its simple and relatively stylish design style.

However, this simple and versatile design and high quality fabric and version are also a double-edged sword, which can gain the favor of loyal consumers and lose the new generation of consumers who are unconventional.

On the other hand, its seemingly simple and versatile style has a competitive relationship with UNIQLO, Japan's fast selling group, but the latter has more price advantages.

"Compared with the same focus on UNIQLO, the price positioning of Gap is a bit embarrassing. The price of these two brands can be several tens to hundreds of dollars."

Not only is it a product positioning problem, but according to the world clothing and shoe net, because Gap does not own its own factory, the cycle of Gap product design to store is 10 months, which is about 3 times that of ZARA and HM.

Wang Wenhua, director of consulting and executive director of CIC, told reporters that the "fast" word in fast fashion market is designed to cater for the diversified needs of consumers in a timely fashion. It is just a manifestation of the external needs, and it is not only an in-depth understanding of the fashion demand of consumers, but also providing the corresponding cost-effective clothing products, which is the deep-seated reason for the rapid development of fast fashion brands.

"At this point, Gap is indeed impacted by other fast fashion brands. Compared to the new speed of Zara and HM, the cycle of Gap is too long."

Allegedly, when Gap group CEO Art Peck took office, its goal was to shorten the cycle to 30 weeks, but he did not give the latest time in the third quarter earnings call.

Regarding this, the reporter also interviewed the Gap aspect, but did not receive the reply.

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Chinese Market

As for the Chinese market, fast fashion has also been in China for a long time, but in the war of share, Gap's performance is hard to say.

Gap brand entered the Chinese market in 2010, but compared with other fast fashion brands, Gap entered China the latest and the pace of expansion was slow.

When Gap announced its entry into the Chinese market in June of that year, its competitors Zara, HM and UNIQLO were popular in the first tier cities such as Beijing and Shanghai.

In the view of the industry, because of the late entry, as the latecomer of the clothing market in mainland China, Gap had to pay higher shop opening costs than its competitors.

In May this year, it was reported that Gap group opened 40 new stores in the Chinese market in 2016.

At that time, the reporter interviewed the Gap side, and the response was that he always believed that China had a strategic and special significance to the long-term growth of the company, and would continue to focus on the development of the Chinese market.

Wang Wenhua said that in the product segmentation, Gap children's bright performance is its most important core competitiveness, Gap children's clothing market share in China has greatly improved in the past few years, Gap also wants to take children's clothing as the starting point to boost the overall business.

"Gap does not lose other competitive brands on brand fabrics. There will be very big opportunities in children's clothing category."

Shao Ligang, general manager of nine consulting and management, told reporters that in the Chinese market, fast fashion brands including Gap, Zara and so on have not really moved to the more offline market, and the space for development is still very large.

However, the foregoing clothing industry pointed out that the current fast fashion has also brought out those who have been eliminated.

"The era of single trait development has passed. This is also a good thing. Some bad brands will be eliminated. There are four or five kinds of foreign fast fashion brands that are normal. They will divide the Chinese market with the help of differences."

More interesting reports, please pay attention to the world clothing shoes and hats net.