Most Recent Articles In People
Latest People Articles
- Indursky Departs Bliss World
- Triple Crown Winning Jockey Victor Espinoza Ready to Race in Saturday’s Kentucky Derby
- Honest Co., Glamsquad, One Kings Lane Founders Talk Female Entrepreneurship
More Articles By
The $14.7 billion Gap Inc. needs a big fix — and it requires a lot more than just replacing chief designer Patrick Robinson, who was ousted Thursday.
This story first appeared in the May 6, 2011 issue of WWD. Subscribe Today.
Retail analysts and fashion experts came down hard on Gap after Robinson’s fate was disclosed, stating the chain needs further downsizing, management changes, product improvement and design coordination with merchandising, and a fresh vision for the overall business.
They also said Gap has become “tired, commoditized and driven by price” and needs to be reinvented. Brands like Abercrombie & Fitch, Gucci and Coach have done it, they reasoned. Why can’t Gap?
“They need brilliant marketers and merchants who understand who the customer is, where the customer is going, like a quarterback throwing the ball down field. They’re playing the game at the line of scrimmage. There hasn’t been anything new,” said one retail source.
The Gap division alone “could be turned around in less than a year, depending on the supply chain logistics,” added retail analyst Jennifer Black.
Others suggested Gap is not without top talent that could be redeployed, citing John Ermatinger, who is in charge of Old Navy International and is considered a rounded executive who understands denim, manufacturing and product development, store rollouts, and is commercial, as well as Mark Breitbard, executive vice president of GapKids and Baby.
“Anything can be turned around, but this is a huge, massive effort.…It’s not just Gap. It’s fixing Banana, Old Navy, moving start-ups, international, franchising. This is a very deep story. But at the end of the day, it’s about the chief executive,” said one competitor, pointing to Gap Inc. chairman and ceo Glenn Murphy, who has headed the retailer since August 2007.
Yet Robinson’s departure creates some challenges for the retailer, since he has been the face of the brand since 2007, conducting fashion previews and media interviews, and had been entrenched in the organization and was in Murphy’s good graces until recently. Murphy turned around Shoppers Drug Mart in Canada, and has kept a low profile in the industry. However, Robinson brought Gap into the glitter of the fashion world, which reached its peak last year when Gap sponsored the Costume Institute gala at the Metropolitan Museum of Art.
“Patrick should have left long ago, but there were politics” that prolonged his stay, said the retail source, without elaborating.
After several years of stabilizing the group’s operations and improving cash flow, Murphy now appears to be moving aggressively to address systemic weakness in Gap Inc.’s various operations. Earlier this year, he reorganized the Gap North America organization, installing Art Peck as president to succeed Marka Hansen, and naming Pam Wallack executive vice president of a new Gap Global Creative Center in New York. “They waited for Pam and Art to be in place” before showing Robinson the door, said the source, who explained why Gap products have generally not resonated with consumers recently. “If you take a pure designer and give him a lot of freedom, it’s not going to work, especially in a mass-driven business. You need someone who is commercial and understands who the customer is. Ralph Lauren is not [just] a designer. Calvin Klein was not [just] a designer. They are brilliant merchants.”
“It’s not just about replacing Patrick Robinson. It’s how that talent is integrated into the organization,” said Les Berglass, chairman of Berglass+Associates, an executive search firm. “Having design report in, independent of the merchandising function, does not lead to commercial success. In fact, the most successful retail design leadership comes from the merchandising function. The best two examples are Michael Alexin at Target and Lizanne Kindler at Kohl’s. Both run huge design departments that generate billions of dollars in volume. Both were raised as merchants.”
Robinson did have some commercial successes, developing fitted cargo pants and directing the reinvention of the denim business under the 1969 banner, thereby strengthening Gap as a denim lifestyle brand. While still responsible for denim development, it seemed he was stripped of some of that responsibility last year with the formation of a Los Angeles denim design team, headed by Rosella Giuliani, who reported to Robinson and now reports to Wallack.
“I love Patrick as a designer,” said Shelda Hartwell-Hale, vice president of Directives West consulting office. “He’s so full of life, so talented. He’s got this contemporary, forward vibe. Some seasons at Gap he was great, but there were always highs and lows.”
She said Gap has recently displayed some “great” career items, improved men’s offerings and a strong white presentation, has done well with 1969 denim and its classic, vintage inspiration, and gets it when it comes to layering. Asked where Gap falls short, she advised further brand building off the strengths of 1969, a better balance to the assortment via more woven tops and taking a “deep dive into classifications.” For fall, retailers will emphasize ethnic, multicultural statements, perhaps Moroccan or Navajo, with water colors, embroideries, print mixing and tribal influences. While expressing hope that Gap follows suit, Hartwell-Hale noted, “They have not been cohesive with what is happening out there.”
With the executive upheavals this year, Murphy seems to be more product-focused, as well as putting a lot of weight into international expansion with franchises and company-owned stores and Internet growth. Earlier, he was focused on expense cutting, improving the financials and making the product pipeline more efficient.
Though ceo Murphy has been criticized for not having a fashion merchant’s touch, analyst Black described him as “really sharp,” particularly with downsizing Gap and Old Navy stores for greater productivity and in many cases relocating GapKids and Gap Body into Gap Adult boxes. “Old Navy on Pine Street in Seattle looks amazing. The merchandise is effectively displayed.” She also said she likes Murphy’s approach to international expansion, typically done with launching Gap online in different countries. “His priorities are changing, but one thing he has been doing for a while is downsizing the fleet,” she said.
Still, as a concerned retail executive said, “Cash on the balance sheet is a wonderful thing, but it doesn’t necessarily indicate the future of a brand. The Gap has a strategy problem, not just a product problem,” said a retail executive.