Did u know?

Don Fisher couldn't find a decent pair of jeans that fit him, so in 1969 he
solved his problem by creating the Gap brand.

Clean. Classic. American design. These words described Gap four decades ago and still hold true
today. At Their best, they inspire customers with individual style and make Classics relevant for today
through the use of bold color, emotional details and great fits.

With a clear brand vision and effortlessly cool product, Gap is re-connecting with its target customer—
men and women ages 25 to 35 looking to express their unique, personal style. They continue to
evolve our assortments with a focus on what they’ve always been famous for: the best of casual style.

More than anything, though, Gap has been known for its connection to pop culture, as embodied in
this image of Lenny Kravitz from the 1990s. (refer to the image)

Gap is committed to staying relevant by continuing to give their customers Gap classics, invented and
re-invented for right now.

PHILOSOPHY
The focus at Gap incorporation is simple customers, creativity, doing what’s right and delivering
results.

Our brands have a simple, common purpose: to make it easy for people to express their personal
style. We constantly evolve each brand to better meet our customers' needs — through innovative and
inspiring design; through convenient and engaging store experiences; and by communicating with
people in a way that connects to how they live, work and play.

When put together they call it “wearing your passion”, and it's the perfect match for the kind of
people they magnetize both as employees as well as customers.

In there terminology below is how they have given body to there beliefs.

Think: Customers first

Every decision happens with our customers in mind. They connect with their stores and create the
quality their customer’s value and expect.

Inspire: creativity
Believer of thinking big, take risks and solve problems. They challenge the status quo and
always look for new ideas and ways of working.

Do: what’s Right

They believe that how they do business is as important as what they do. They act with integrity,
and give back to the communities in which we do business.
Deliver: results
Delivering the best results possible–a sturdy commitment towards responsibility and then leaving
no stone unturned to realize them.

Elaborating further GAP Insists in delivering not just value and quality driven products but going
beyond it where sustaining the brand value and consistency becomes more then just a
responsibility.

STATEMENT OF THE PROBLEM

Many of Gap's problems are those facing other retailers as well, analysts said.
1. Shoppers are reluctant to spend on clothing, and many
aren't rushing to the mall -- this time of year is particularly slow for retailers.
Last week Macy's, Kohl's and Nordstrom all reported disappointing first-
quarter results.

2. But Gap has one problem that it can't blame on economics: bad
fashion. Its clothing has failed to entice shoppers, swinging from uber-trendy
to boring basics, analysts said, and the company no longer seems to
know what sets it apart from competitors.

"It's almost a brand in search of an identity," said Neil Saunders, chief

executive of research firm Conlumino. "They either try things that are
extreme, and it jars. Or they do it in a half-hearted way and it loses impact."

A lack of compelling brand identity

“The answer lies in one critical point, which is that consumers are looking for personal
style,” says Richard Passikoff, founder of marketing research firm Brand Keys. In the
firm’s 2016 loyalty rankings of consumer engagement, Gap dropped 20 spots from the
previous year. J.Crew also dropped 10 slots, topping only Forever 21 and Gap among
apparel retailers.

“I don’t think there’s any kind of a clear sense about what Gap stands for,” says
Passikoff. Despite the excitement about Rebekka Bay’s leadership — who is credited
with the successful development of H&M sister brand Cos and was creative director at
Gap from 2012 until early 2015— her vision was not felt on the sales floor. (In 2015, she
was hired by Everlane as head of product and design.)

“Gap is not a design-led company and thus I had very little say in what ended up in the
store,” Bay told the Wall Street Journal. Chief executive Art Peck told the paper he views
creative directors as “false messiahs.” But Gap’s product assortment has been indistinct
and not compelling, leaving it open to cannibalisation by sister brands Old Navy and
Banana Republic (the latter of which is in deep trouble too).

The answer lies in one critical

point, which is that consumers are
looking for personal style.
“There just hasn’t been a discernible trend for them to grab onto,” says retail analyst
Gabriella Santaniello. “They are over-assorted, you can tell they are grasping at straws.”

3. Consumers expect low prices and promotions

“She’s loyal as hell until we go wrong," said Drexler in a March 2015 conference call
about J.Crew’s shopper. “Then she wants it on sale.” A highly promotional environment
plagues all three retailers, whose customers have grown accustomed to seemingly
constant discounts in the last several years. “Price is more critical than ever before,” says
Davidowitz.

And shoppers are spending less on apparel in general, especially younger ones who
prefer to spend on electronics and experiences. According to 2015 data released by the
Commerce Department, the share of total consumer spending allocated to apparel has
reached historically low levels.

“[J.Crew’s] price points are out of whack for what’s going on in the market right now,”
says Santaniello. Madewell hits a sweet spot, however. “It’s little bit elevated for the
crowd they’re going for, but it’s still attainable,” she says.

In order to better address the needs of price-conscious shoppers, retailers are expanding
their off-price business. As of October, J.Crew added 28 Mercantile locations (off-price
product stores located outside outlet malls) in 2016.

4. Advertising has reflected the creative confusion.

Its advertising has reflected the creative confusion. In 2014, Gap debuted the
tagline "Dress Normal," jumping on the normcore trend that has made
Birkenstock sandals, plain turtlenecks and mom jeans not only acceptable but
trendy among fashionable women. Then last year, Gap came out with a series
of videos on Instagram proclaiming that "Spring is Weird."
Those kinds of wild swings in message reflect a deeper problem at the core of
Gap, said Betty Chen, a managing director at Mizuho Securities in San
Francisco.

"I'm not sure they know who their customer is anymore," she said. "It's
definitely been a tough time for fashion retailers in general. Gap Inc. has been
struggling more than others."

Gap has fallen a long way since the 1980s and '90s, when its jeans were highly
coveted and its TV commercials featured diverse casts of beautiful young
people dancing and singing in corduroy and khaki pants.

But Gap never evolved beyond its reputation as a place for clean-cut basics.
While other retailers such as J. Crew (under the direction of former Gap CEO
Mickey Drexler) and Urban Outfitters updated their aesthetic to keep up with
changing times, Gap never successfully managed to modernize.

"When you go into a Gap store, you know almost exactly what is in there -- it's
going to be navy or beige chinos and v-neck sweaters," Saunders said. "It's the
same old sort of stuff, and that's why people got bored with it."

Some shoppers such as Wintila Moreno, 31, said they only go into Gap to take
advantage of heavy promotions -- the brands often do 40%-off-everything
sales. The La Puente resident said she has always associated the brand with a
"very Rhode Island, preppy look." Instead, she prefers the prices and fashions
at H&M and Zara.

Gap "is not my style and has never been my style," the paralegal said. "It's very
bland, no color. And it's pricey for the quality."

5. Intense Competition
-Abercombrie, American Eagle, Aeropostal, J Crew

-Similar Target Matket

Gap was rated 4th in brand preference in 2001

-A&F was rated 1st and teens’ most frequent place to shop

The threat of Amazon

It’s no secret that Amazon is intent on dominating fashion retail. Cowen and Company,
a financial services firm, predicts the online giant will overtake Macy’s as the biggest US
apparel retailer this year. (On Wednesday, Macy’s announced plans to close 63 stores
and eliminate 10,000 jobs in the face of declining sales.)

“Bottom line, you’re vulnerable if you’re a category killer,” says retail expert Carol
Spieckerman, explaining that highly-focused retailers specialising in a single category
are no longer resilient business models. “[Amazon is] essentially willing to buy the
business in order to stake a claim, and that’s very difficult to compete against.”

Unlike specialty retailers, Amazon can also cater to different price points. “It can sell
down and dirty cheap t-shirts all the way up to luxury items and nobody says that any of
it is out of brand,” says Spieckerman. “[Specialty retailers] have to stay in brand because
their brand is really all they’ve got.”

It’s also costly to compete against the Amazon Prime customer experience, which has
become the new standard, she adds.

Moving forward, specialty apparel retailers with substantial free cash flow have the best
chances of survival, if they invest in omnichannel retailing and customer service and
make speed and flexibility a priority across the entire company, not just supply chain
departments. But the consequences for inaction are dire. “I think we are going to have
another wave of attrition where some of the brands will go away,” says Spieckerman.

Licensing remains a silver lining, however. “The options for transferring brand equity to
another business model have never been more numerous,” she says.
STRATEGIES
• GAP decided to use multichannel strategy.

• Company saw its bricks-and-mortar stores not as an impediment, as many Internet pure-plays
liked to assert, but as a key asset that it could leverage to give consumers a complete shopping
experience:

• Consumers benefited in several ways:

 Customers could return products to stores even if they bought them online.

 Banana Republic offered free alterations.

 Customers could do product research first on the Web and then buy at brick-and-mortar store.

 Customers were more comfortable buying online because of GAP’s well-established brand and
reputation.