GAP'S OPENING SALVO A UNISEX LINE

Byline: Soren Larson

NEW YORK--The Gap has entered the beauty sweepstakes.
The San Francisco-based apparel giant expanded its horizons earlier this month by launching a line of unisex personal care products called Gap Scents.
The collection, introduced Nov. 1 in 52 Gap stores in the U.S. and six in Canada, includes soaps, body lotions, shower gels, eaux de toilette, shampoos, conditioners, bath salts and aromatic candles. Each product is available in four fragrances: Grass, Earth, Day and Heaven.
Prices range from $2.50 for a soap to $18 for a 4-oz. fragrance. A travel set, containing a miniature shower gel, shampoo and lotion, retails for $7.50.
The package design is in the company's typical minimalist style, while an environmentally friendly image is presented in the informational booklets provided in stores.
Although Gap executives declined to be interviewed for this article, sources indicate the products were designed and manufactured by Mottura of San Francisco, an upscale bath and body company that The Gap purchased last year. "The Gap has finally realized this opportunity," said John Horvitz, an industry consultant. "There's no reason why they couldn't build a $200million to $300 million business out of this. What's out there is tastefully done, it's contemporary and attractive. And it's just a beginning, I assume.
"Certainly this could do in excess of $300 or $400 per square foot [annually] in the limited space it takes up," he added. "It's a significant add-on to their profitability."
The 776 Gap stores in the U.S. had sales of about $1.9 billion last year.
Horvitz also speculated that the new line might be the first step toward The Gap launching its own freestanding bath and body boutiques, in a vein similar to the Body Shop.
Consultant Allan Mottus said moving into beauty was a natural progression for the company.
"With Sears doing it and The Limited having done it, they had to be next," he said. "It gives them another option in their stores."
The Gap's chief competitor, The Limited, has already enjoyed explosive growth with its four-year-old Bath & Body Works division, which is expected to finish the year with $260 million in sales and 315 stores. This compares to 200 stores doing $120 million last year.
"The Limited has a significant lead in this area," said one industry source. "Add to that the presence of numerous other competitors where the Body Shop was originally, and one wonders how far [the Gap] can go in this area."
Gap Scents is apparently part of The Gap's plan to explore new product categories. In October, Warren Hashagen, senior vice president of finance, told a Robertson Stephens & Co. Consumer Conference here that the company is seeking merchandise to lure "incremental" purchases. The plan includes offering new items such as shoes--which are currently carried in about 100 locations--and personal care products, of which Gap Scents is the first step.
At a Gap store on Manhattan's 34th Street, three self-service display units carrying the Gap Scents line are positioned in the center of the store, with testers on the top and boxes of inventory underneath.
A saleswoman at the unit said the new line has been "doing really well" since the store started stocking it at the beginning of the month. She said men were buying nearly as much as women and that the eaux de toilette were popular, in particular the Heaven scent.

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