AN ICONIC HISTORY

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AN ICONIC HISTORY
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PROBLEMS ARISE

• Differentiation Woes
• Loss of Core Competencies
• Leadership Struggles

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OH WHY? WHY? WHY?

• Need for differentiation with key competitors
• Brand expansions blocked by each other
• Cannot expand without cannibalizing another Gap
  Inc. brand

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WOE IS US

• Who are Gap's customers?
• Consumer has the power
• Customer Loyalty Declining
• Loss of Trust through Loss of Brand Identity and
  Uniqueness
• Unable to Reconnect with Target Consumers
• What are Customers Buying?
• Lifestyle
• Personal Identity
• Status

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WILL THE RIGHT HELP ARRIVE?
Can leadership sink the ship?

• Leadership shortcomings
• Effective at operations or creativity but not
  both
• High executive turnover rate since 2002
• Suffering from lack of consistent direction and
  focus
• Attempts to change corporate culture backfired
• Increased inefficiencies
• Added bureaucracy
• Alienated creative design staff

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Unfulfilled Needs
Competitors' Offerings Not In Demand
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RECOMMENDATIONS

• Sell Banana Republic
• Will provide room to expand Gap brand offerings
• Split CEO Job into Two Positions
• Have separate CEO and President
• CEO focus on creativity, marketing
• President focus on operations, expansion
• Improve Supply Chain
• Reduce lengthy lead times
• Better quality control
• Reduce potential for counterfeit merchandise

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• Other Potential Strategies
• Differentiation Strategy Move away from Basics
• Basics highly imitable
• Refocus on trendy fashions
• Focus on Disposable Fashion
• Young consumers willing to adopt new fashions
  each year and replace wardrobes accordingly
• Focus on Youthful Consumer
• Growing amount of disposable income
• Become Second Mover
• Let competitors bear expense of testing new
  products and styles
• Only pick up on most popular styles
• Be quick to analyze and respond

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