Gap closing Piperlime (no big deal)

Discussion
Jan 27, 2015

You can tell by reading the headline in the Gap Inc. press release that the company is looking to downplay any negativity associated with its decision to close Piperlime, its online answer to Zappos. Referring to Piperlime as its "smallest brand," Gap Inc. is looking to sell analysts on the wisdom of the decision to focus on managing its namesake brand along with its Athleta, Banana Republic, Intermix and Old Navy businesses.

Gap plans to close the Piperlime site along with the one store that bears its banner by the end of February. The division represented less than one percent of Gap Inc.’s $16 billion in annual sales.

As a Wall Street Journal article pointed out, this is not the first time that Gap Inc. has made the decision to shutter a business. Back in 2007, it closed Forth & Towne, a concept developed for older women.

"We are incredibly grateful to our fashion-focused, loyal customers, and proud of our dedicated employees who have been working hard to evolve the [Piperlime] brand and test out new ideas," said incoming CEO Art Peck in a statement. "We plan to keep on pushing new ideas and look forward to seeing how we can apply what we’ve learned to the rest of the company as we continue to bring great products and shopping experiences to our customers."

Do you approve of Gap Inc.’s decision to shutter its Piperlime business? What lessons do you think Gap Inc. learned from its Piperlime experience and how will that inform its other businesses going forward?

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9 Comments on "Gap closing Piperlime (no big deal)"

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Nikki Baird
BrainTrust

I never really understood why Piperlime existed in the first place. I mean, I get all the stated reasons, and competing with Zappos seemed like the primary one, but Gap has built its brands by appealing to specific market segments, and Piperlime always felt like a “one of these things is not like the others” kind of format—category specific, rather than customer segment specific.

But if it’s not performing like they wanted, and not growing like they wanted, then kudos at least for being able to acknowledge that it’s not working and move on.

Ken Lonyai
BrainTrust

Without having inside information it seems as though the company has stretched its market too thin and lost site of its core brands. There’s nothing wrong with a company trying new ventures and failing. Hopefully they did learn from the experience and can use the experience as they refocus under new top leadership. Gap, Old Navy, Banana Republic, etc., will best compete against Amazon and Zappos by being themselves and executing very, very well.

Joan Treistman
BrainTrust

Gap has determined that Piperlime doesn’t present the growth they were looking for. The decision to shut it down makes sense financially, and neither damages the images of their other brands nor deters them from future experiments.

Gap evaluates what works and what doesn’t and moves on—and beyond. I think the rest of the retail world can learn from them.

Gap appears to have learned valuable lessons even before their Piperlime initiative. And those lessons serve them well.

Gene Detroyer
BrainTrust

“The division represented less than one percent of Gap Inc.’s $16 billion in annual sales.” A company should always be trying new things and when they aren’t working and have little future kill them. Most companies fail on both counts. They don’t try new things. Then they go with them too long when they don’t fit the future.

Every time you try and fail, you learn something. You learn what can be adaptable to your current business and you learn how to do it better next time. If you don’t make mistakes you never really learn.

John Hyman
Guest
2 years 5 months ago

There should be an appreciation for any company experimenting with a new retail concept. There were so many variables that affected this outcome, both internal and external, and my hope is Gap management will find another one and “give it the old college try.”

Roger Saunders
BrainTrust

The full-service retail business has taken a page out of the success book of a number of well-run restaurant operators. The Mellman Group (Chicago-based) and the Cameron Mitchell Group (Columbus-based) string of diverse restaurant segments have followed a pattern of decisively closing down an operation that isn’t meeting expectations.

As the Honorable Richard J. Daley, Chicago’s Mayor in the ’60s and ’70s, once said, “Don’t back no losers.”

The window of time, given the increased expense pressures of retail operations, has decidedly contracted. Likely to see more moves such as the Piperlime decision. That should not, however, prevent retailers from experimenting and innovating—that is a must-have characteristic for success.

gordon arnold
Guest

I suspect that GAP is working very hard to protect margins and the core business. Lazy same-store sales resulting from our reverse recovery can be slowed down by opening or buying retail outlets that have stabilized numbers. This is nothing new to the survivors of our economy and there is nothing new about retiring anemic sales producers abruptly. The real bad news is that this will continue as the norm for the foreseeable future. Nothing is fixable until we discover and admit what the problems are.

Craig Sundstrom
Guest

I’m traumatized but I’ll get over it. Okay, seriously, we don’t really know how it did, most of us have probably never heard of it, and the few who did admit they ” never really understood” why it was created in the first place…could it be more difficult to pass judgment on the wisdom of this decision?

That having been said, the low level of attention this attracts—even, apparently, from GAP itself—suggests that either it was a complete rout , or it was starved for attention throughout its short life. RIP Piperlime, we hardly knew ye…really.

Shep Hyken
BrainTrust

I can’t speak to approve or disapprove Gap’s decision. That’s their business and they know better than I. They know when to cut bait.

So, how do you compete with Zappos? Not easy, but I know this: Don’t be another Zappos.

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