How Did Gap Become So Frequent?

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The third quarter continued to regress, and the Gap group announced that it would further expand its scale.

According to the financial report, all of Gap's holdings

Sales in the third quarter of 2016 amounted to $3 billion 798 million, down 2% from the same period last year.

In addition to the company's largest global brand Old Navy sales growth of 3%, Banana Republic and Gap sales fell 8% compared to the same period last year.

Gap sales have fallen for 7 consecutive quarters.

In terms of net profit, Gap's net profit in the third quarter was US $204 million, down 18% from the same period last year.

According to the earnings report, Gap will close 65 stores later and gradually reduce the size of the store.

Nightmare like shop fever

Since 2014, the days of Gap have not been much better.

In the whole year of 2015, Gap was trying to save its declining sales by closing stores and layoffs.

According to public information, in June 2015, Gap entered the darkest month in history. It 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.

Gap Group CEO Art Peck hopes to reduce costs. In addition, he believes that a reasonably streamlined store team and headquarters staff are better able to attract customers.

Since then, Gap has been like a magic spell and has been closed.

In less than a year, as Gap declined 6% in the first quarter of 2016, Gap announced that it would close 75 Old Navy and Banana Republic stores outside North America.

In November 2016, Gap announced that it had closed 65 stores, much more than the 50 previously anticipated.

According to statistics, when the earnings report was released in the third quarter of 2016, all Gap brands had 3742 stores around the world, and 41 stores were closed in the third quarter.

Gap said that, in any case, 1600 companies will be operated and franchised in 50 countries around the world.

Is there anything new besides closing the shop?

After the release of the earnings report, chief financial officer Sabrina Simmons said that the current traffic volume is still not optimistic.

In fact, from the low performance of Gap in recent two years, Guan chao chao did not save the turnover and net profit of Gap, and it was not a successful strategy.

Instead, it became a normal way to deal with poor performance.

Many people can't help asking how the once cool Gap has been reduced to frequent closes.

In recent years, the competition of fast fashion brands is becoming more and more intense. Gap needs to face Inditex's brand, including Zara, Pull&Bear and other low price, fashionable brands. It also needs to face the brand of high quality and comfortable route such as UNIQLO.

In terms of price and design, Gap does not take any advantage.

Comparatively speaking, Gap has some common features with UNIQLO, and their styles are similar. There is not much fancy design, and the quality of products is better.

But Gap has not been able to provide high quality products at low prices like UNIQLO for many years.

In many attempts to change, Gap seems to have failed to find the right direction.

Independent fashion footwear commentator Ma Gang said that the characteristics of fast fashion brands are the short production cycle of garments and the integration of fashion elements and marketing.

But in recent years, Gap's marketing is not active enough, and its products lack bright spots.

And GAP's products and styles are not very good.

Iteration.

Some commentators believe that when Gap is sold, khakis and white shirts will be sold to every American. It should be realized that, like Taobao, it will soon be rejected by consumers, because no one wants to dress like others.

Not only that, Gap missed the style of normcore, which has been popular in recent two years, but the explanation of normcore is that it is simple and plain, comfortable and practical, and the neutral style of dressing is similar to the basic T-shirt, leisure shirt, jeans and denim skirt.

This coincides with the idea of Gap.

In the face of such a style, all brands have launched normcore style clothes, while Gap's clothing is still the same. The price is still so high that the opportunity is missed.

Gap is changing all the time, but the rate of change is far more than that of stores.

In the future, there are many product categories, price positioning, and marketing methods that can change for the "millennial generation".

Sabrina Simmons, chief financial officer of Gap, said in a conference call after the earnings announcement, that we need to replan in addition to closing stores, and invest more in how to attract customers into stores during holidays.