Sitting on the Edge of The Gap

As VM+SD's annual International Retail Design Conference steams into San Francisco this month, one of the city's most iconic retailers steams into IRDC.

Mark Dvorak, vp of global store design for the Gap, will be talking about “Gap Inc. – Now.” But to put that in context, you'd have to review “Gap Inc. – Then …and What Happened?” This, after all, was once the retailer that could do no wrong. Its reinvention of Gap, from denim to khakis – brilliant! Its reinvention of Banana Republic, from safari suits to cutting-edge fashions – brilliant! Its creation of Old Navy, for affordable trendiness – brilliant!

In the mid-1990s, it bet big on khaki, and came up with a full house. Gap stores proliferated and the Gap image became hip. When, in 1998, its “Khakis Swing” TV campaign had everybody dancing, Gap danced faster than anyone. When it opened a new flagship on Fifth Avenue in New York in 1998, the crush at Christmastime was so great the revolving doors came off their hinges. December winds blew into the store, but customers continued to shop.

Millard “Mickey” Drexler, Gap's ceo, was hailed as the merchant king – introducing the private label model, redesigning the company's stores from floor to ceiling, using such diverse marketing icons as Andy Warhol, Marilyn Monroe and Picasso, introducing stylish-but-affordable basics – khakis, pocket T's, pre-washed jeans. (It could be argued that Gap – as much as Target, H&M and Pottery Barn – democratized style.)

But when the elevator's on the top floor, there's only one direction for it to go next. By the new millennium, analysts were saying people had all the khaki they needed; there were too many stores; Drexler suddenly made too many merchandising mistakes, steering Gap too far away from basics to trendy, ordering too many polo shirts in too many colors and sizes, decision-making too often from the gut. Whatever. There has been a 60-month slump.

In 2002, Drexler “resigned.” He was replaced by Paul Pressler, formerly chairman of Walt Disney Parks & Resorts. (The wag line was that Gap had replaced one Mickey with another.) A management shakeup, store closings and cost-cuttings ensued. A new Forth & Towne concept was introduced last year, aimed at the now-maturing shopper who had helped make the Gap a phenomenon 30 years earlier.

The results have been up and down, but the ebullience has never left. Dvorak told us, pre-conference, that his team has rethought the entire in-store experience and is undertaking a “reinvention.” He'll be focusing on such questions as: What draws people into a store? And how do you freshen and differentiate a brand?

Gap has indicated a full marketing blitz this fall, with a return to TV advertising (after a year's absence) and radio (for the first time since the late 1990s); in-store music events; redesigned shopping bags; new spokescelebrities, from today's hot Ari Gold (Jeremy Piven) to yesterday's hot Daisy Buchanan (Mia Farrow). There'll even be a subtle revival of “fall into the Gap.”

We've seen other meteors rise and fall in this tricky business. A decade ago, we were hailing not only Gap but also Sephora, NikeTown, Sears (ah, yes, the softer side), Tommy Hilfiger, Toys “R” Us, Proffitt's, Sports Authority, Disney and Warner Bros., Home Place, anyplace that sold cigars – well, you get the idea.

We were also preparing eulogies for Abercrombie & Fitch, Barneys and Ann Taylor. And wondering what Federated would do with all the Macy's stores it had just acquired.

What will be Gap's future? Come to IRDC in San Francisco to hear the whole story. Or watch these pages for more information.

In good times and in bad, Gap demands our attention.