Is The Gap brand An Anchor Or An Albatross For Its Parent?
Gap Inc. on Thursday joined rival apparel retailers in drafting on the smooth-sailing economy, posting an 8% second-quarter net sales rise to $4.1 billion, and its seventh consecutive quarter of comp gains at 2%. But the story was familiar: Old Navy bolstered results with its third straight quarter of same-store sales increases. The downfall of the company’s flagship Gap brand, once a definer of style for casually well-dressed Americans, has persisted to the point where, last year, executives retooled their growth strategy toward greater dependence on the lower-priced banner. Meanwhile, the company’s athleisure Athleta brand is showing promise and a capacity for growth, and even its struggling Banana Republic label rang up a 2% comparable sales rise — its third straight comp gain after falling 5% in the year-ago quarter. Gap Inc. didn’t respond to Retail Dive’s request for an interview for this story. But executives last week promised on earnings calls that the Gap brand’s results were poised to improve in the second half of the year, as low-performing inventories cleared out and new chief Neil Fiske had more of a chance to make his mark. But the company’s strategy looks increasingly like one that’s giving up on its flagship. Read more at Retail Dive.
