The “numbers” are all heading in a positive direction following a decade of collapse. The “street” has a buy recommendation on its stock. A little “buzz” is being heard. Are we being fooled once again about a Gap turnaround, or do we just want to fool ourselves, hoping it’s so? Or is the Gap really being “re-gapped” as in being smartly repositioned?
My short answer is yes, the Gap is being smartly repositioned for a target consumer whose time has come: the Millenials. When the Gap was launched in 1969, its target was the core youth segment of that era: the Baby Boomers. And as they say, “the rest was history,” until it wasn’t. The great unraveling began in the 2000s and the Gap has painfully been trying to obliterate that bit of history to start a new era.
The Boomer story is one of love at first sight followed by a long (20-year) honeymoon, then the start of a falling out. Sticking with the metaphor, marriage counselor, Mickey Drexler, steps in and performs a merchandising renewal of vows, which held all the promise of Gap and consumer, together sailing away into the sunset. Gap even had thousands of offspring (read: stores) . But, alas, as in many distressed marriages, the connection failed.
Interesting story but who cares? We want to know why it failed, and why and how the new marriage counselor is going to create a new love story.
I believe a major factor in the Boomer positioning, and one that all mono-branded specialty retailers must be diligent about, is what I call “positioning drift.” Simply, the tendency for a brand to age along with its aging consumers is insidious. However, such aging, if managed well, can indeed maintain a strong relationship between brand and consumer as it did for the Gap and its Boomers for some 30 years. In fact there was likely a “halo-down” effect on a younger “boomer-emulating” segment. Of course, when the Boomers tipped over into “aging” territory, the halo disappeared.
So, new counselor, CMO Seth Farbman, seems to have spotted this age “drift,” referring to it as “No. 39 tells the story,” essentially calling out the average age of Gap’s customer today. And, let’s face it, this group is not going to deliver the growth Gap is pursuing. Enter the Millennials: ebulliently optimistic; totally energetic; and, with game-changing cultural preferences including lifestyle becoming more important than possessions; an aversion to compulsive consumption; quality trumping quantity; and community, sustainability and a sense of a higher social purpose.
And, according to Mr. Farbman, as he re-Gaps the Gap and its products to connect with this new consumer, there will be a “halo-up” effect, and in the process, will attract more of those 39-year-olds that are thinking younger.
Finally, while “…I know Mickey Drexler, and Seth Farbman may be no Mickey Drexler,” (to quote an old debate line), I wish him the best of luck in creating a happy marriage between the Gap and the Millennials.
From what I see, hear and read, he is smartly “re-Gapping” the Gap. And the lesson for all mono-brand specialty retailers is to recognize and avoid the “positioning drift:” the grim reaper, watching and waiting as brands unknowingly grow old along with their aging consumers, ultimately to their mutual demise.