Gap’s latest collaboration with Pendleton Woolen Mills – Photo: Gap
If not creative directors or data, what can make Gap’s fashions sell?
Some may see a good creative director as a necessity for fashionable apparel design, but Gap CEO Art Peck does not. It’s a sentiment he doubled down on when calling them “false messiahs” in a recent Wall Street Journal article.
Peck’s renewed expression of skepticism about the creative director role, as Quartz reported, comes in the wake of a few moves. When Mr. Peck came on as CEO in early 2015, he eliminated the creative director position from Gap. He has subsequently made attempts to decentralize the design process, outsourcing design to vendors and pursuing a data-driven approach to meeting customer desires rather than relying on a single creative director’s vision. But apparently these moves have yet to make Gap fashionable again.
Mr. Peck’s “false messiah” claim is not the first provocative statement he has made to the press about the state of the fashion industry. In September, he told analysts that there were no compelling fashion trends driving the industry. In a discussion by the RetailWire BrainTrust, many panelists rebuffed the claim as inadequate for explaining Gap’s shortcomings.
While data-driven design does not seem to have pulled Gap out of the doldrums, some fast fashion retailers like Zara, as Quartz pointed out, are thriving based on such strategies.
Zara designers receive data each day on what sells and what doesn’t, according to a Bloomberg report. The designers base products on that data, along with thousands of customer comments they receive. The new designs hit the shelves within a few weeks.
The use of trend data and the speed-to-market it enables may look like Zara’s special sauce. A RetailWire article, however, noted that some fast fashion retailers, like Forever 21, Uniqlo and H&M, are failing to hit the same numbers as Zara these days, despite speedy supply chains.
Whatever has allowed Zara to thrive in this environment, Gap could desperately use some of it.
In November, Gap announced the impending closure of 65 stores, increasing the number from its previous forecast of 50. At the end of October, the company announced its seventh straight quarter of declining sales.
- As Gap Struggles, its Analytical CEO Prizes Data Over Design – The Wall Street Journal
- Gap’s CEO Art Peck Missed The Brand’s Biggest Problem When He Called Creative Directors False Messiahs – Quartz
- Is a trendless fashion industry killing Gap’s business? – RetailWire
- Zara’s Recipe for Success: More Data, Fewer Bosses – Bloomberg
- Gap Shares Flop After Chain Says It Will Close More Stores Than Expected – Fortune
Discussion Questions
DISCUSSION QUESTIONS: Why has a data-driven, decentralized strategy for apparel design not worked for Gap thus far? Could Gap benefit from a good creative director? What is missing from the way Gap selects its assortment?
Poll
BrainTrust
Dick Seesel
Principal, Retailing In Focus LLC
Jasmine Glasheen
Content Marketing Manager, Surefront
To blame soft sales on “lack of a trend” fails to recognize the retailer’s responsibility to help create those trends. Back in the Drexler-led heyday of The Gap, the company helped create the khaki phenomenon by getting behind the item in a huge way and by marketing it on TV as a must-have wardrobe item. The same principle applied to many other items in the store — from my days merchandising handbags, I remember a canvas tote in a bunch of colors that the industry dubbed “the Gap Bag.”
It sounds like Gap is suffering from the suffocating influence of both its creative direction and its data science, making it hard for entrepreneurial spirit to thrive among its merchants. (And it also looks like Gap has been slower to embrace the short-cycle, high-turnover model of its fast fashion competitors.) Gut feeling can still work wonders to drive sales, if a retailer has the courage to react quickly to big ideas.
I think it’s easy to paint the lily and say how Gap is so far off-base. That leads to the question — what are they doing right? Anything? Training? Displays? Apps? I never hear of any of that. Fundamentally there needs to be one vision of what Gap is and how they do things; they can’t grow by grabbing at tools to fix something until they can see the expected product.
“False messiahs” — that’s so funny. I thought he was talking about CFOs. What’s clearly been missing from Gap over the years is something great to buy. Pretty simple. Whether it’s style or quality or uniqueness, they just haven’t had it. So if it isn’t someone with a great sense of style and taste, what is it then? Someone who can read numbers? C’mon!
In sports there’s a saying you have for a team that’s losing if they start to gloat over something: “hey, check the scoreboard.” Peck should do the same.
No retailer can be expected to be everything to everybody. But, I’m with Lee — the Gap simply doesn’t have anything that they’re able to hang their hat on these days. Various approaches that seem half hearted in effort haven’t left much in terms of style, quality, uniqueness or anything else. Gap needs to get back to doing at least one thing really well so they can be known for something again.
Data-driven design uses a “rear-view mirror” looking at the past. No matter how big the data or how sophisticated the analytics, trend data is based on history. What history are the Gap designers studying?
What do customers really want? Why not ask them? First you have to know who your customers are. Who are Gap’s customers today? What do they see as fashion trends THEY would purchase?
Beyond what sold last week, there are host of ways to “ask” and study future trends through social media, especially Instagram and Pinterest.
Thoroughly agree, Chris. Big data can easily lead to companies driving backward over a cliff while looking in the same rear-view mirror data.
That said, I’ll trot out the concept about consumer research discussed by Steve Jobs. Consumers can’t tell you what to make. End of story. They CAN talk about where they are, their hopes, their dreams, their frustrations, their lives and the products they use/fashions they wear. And you’d better listen to all that. But they can’t tell you what to make. Neither can the futurists. For that, a company needs to dig deep into its own vision.
But maybe it’s not a “creative director” that’s needed — that title is pretty stale and draws people who often are too involved in creativity without seeing the market.
Zara is basing fashions on its analysis of data (not just the data but the analysis of the data) to understand consumers when creating fashions. Gap is not and is now allowing lots of people to create different messages. Not understanding consumers and diluting the message is a recipe for disaster.
Gap has no vision, no core story, and as a result, suffers from declining sales. What worked in 1969 is not relevant to 2017. Somehow a string of Gap CEOs have missed this. Gap can’t be Zara or H&M, but management can decide what Gap stands for and build its entire operation accordingly. Data can play a key role in that decision. So can becoming truly omnichannel. Gap has a way to go to become relevant. Closing stores to save money only saves money, it does nothing to improve the brand.
It’s not all about the data. At Zara, employees are empowered to communicate customer likes and wants directly to designers. For them to do this, that means that have to get really close to their customers. Gee, I bet when they talk to their customers they may even show a little excitement about the brand.
I don’t know if it requires a creative director, that’s not my area, but hearing and communicating what your customers want then seeing what they buy, analyzed by the right people, looks like a winner to me.
And that’s my 2 cents.
Gap has lost its reputation as a place to buy high-quality wardrobe staples precisely because they are trying to copycat business models completely different than their own. Gap would be better off taking a page from J.Crew’s Madewell playbook and coming out with their own ethically made specialty apparel line.
The brand is going in the wrong direction: If Gap drops in quality it will fall off the radar entirely.
Immediate results too often cloud the importance of learning how to do something. Moving to more customized products offers many benefits including higher margins and greater customer loyalty, so steps in this direction are steps toward brand relevance. For retail to evolve it must become a learning culture versus simply shelf stocking, shilling and shipping. Analytics and customer “conversations” to gauge sentiment and aspirations are key inputs leading to products that fulfill a need, and in this the emphasis shifts from sourcing to the customer relationship.
The market is rapidly changing, and Gap is suffering a death of a thousands cuts. Most of their “core business” items are available anywhere else, and in particular online, which takes a slice. Amazon basics takes another slice, probably in the long run a bigger slice. If the Gap can’t differentiate itself with new and interesting products then why would anyone pay better prices for what are arguably not-so-special products? Who needs creativity, newness, unique products in this market — really?
I don’t know the answer to the question, which illuminates a problem vexing Gap for a decade. I’d recommend, though, that Gap issue a moratorium on some clothing items that have been in the store for that same decade — pastel stripe sweaters, plaid shirts, boxy dresses and more. Gap needs to get out of its comfort zone and put some newer designs in the store … banning the old ones is a start.
You can only see what you are willing to look at. I don’t believe I’ve ever heard anyone in the fashion industry echo Art Peck’s idea that there are , ” … no compelling fashion trends driving the industry.” If fashion isn’t about trends, then what is it about? So the quick answer is that Gap could, in fact, benefit from the right creative director. Now, in fairness, Peck is right in focusing in on actual customer demand, but successful fashion is a blend of simultaneously listening to and leading the market.
Gap is a replacement brand with one look. Zara is a fashion brand of many looks, engaging customers emotionally, triggering the “buy” response, evidenced by Zara sales. As a previous Design Director to Nordstrom, I traveled the world design directing and building products to trigger an emotional buy response from the intended customer. There is a place for data but unfortunately, most data is interpreted anecdotally based on the retailer’s perception, not the customer’s perception.
It’s a poor craftsman who blames his tools; alternately, even the best of tools won’t help if you put them in the hands of someone who is all thumbs.
I’m not sure what GAP’s big problem is — correction: the big problem is they can’t sell, much — I don’t know the reason behind that problem — but after a decade (or more) of going nowhere, their future is starting to look Searsish, or at least JCPish. The hubris really needs to be put on clearance.
Making a binary choice between a creative director and the use of data-driven insights is absurd. Insights drive creative, otherwise it’s just about someone making things up and hoping they work. Business, retail and especially fashion requires creativity; data alone does not make for creativity.
If you want to know what’s wrong at Gap, look at their website or visit a store. They’ve become just like everyone else: a mass discounter selling the same things as too many other merchants. Look at J.Crew too, another former industry leader who is now increasingly irrelevant.
It’s not creative directors OR data. It’s not binary. It’s creative directors AND data. I’ll make the distinction that it’s a great creative effort AND data-driven execution. It’s left brain PLUS right brain. It’s the skill of the merchants and how they both guide and edit the designers with the volumes of data available. Pure historical data is one thing. What are they doing to create forward looking data … TESTING?…
Gap tried a creative-dominated strategy and they got killed. They went off their brand promise in that effort. A data dominated strategy would suffer the same fate. Merchants are supposed to create an environment where creativity and number crunching enjoy a marriage, not a competition. But, the retailer that taps the creative vein in the right way, at the right moment wins the day. Consumers don’t walk the mall looking for the best number crunchers.
Who is doing it right? That would be my question to the distinguished panel of commentators. Of course it is easy to be anti and to point out everything wrong at The GAP. Except that $16.4 billion of GAP sales when the only other company I see from the comments is Zara at $19.7 billion. Quibbling over $3.3 billion? Good Lord — first world problems. We tend to get tangled up in data versus creativity or data and creativity when it may come down to Zara is NEW to the U.S. and its online offering is timely (compared to GAP) and Zara is using SCARCITY to drive demand (no reorders). So it may not be data science or design or loyalty or something any more complex than NEW and SCARCE. If I’m wrong … have at it please.