Gap was one of the most beloved retailers in the US and an emblematic part of American fashion and style. With its laid-back classics and iconic denim, the company became the go-to destination to obtain the effortless jeans-and-T-shirt look at an accessible price.
This can only be achieved through a firm with extensive knowledge, experience and innovative strategies. To determine the strengths of the company potential, weaknesses, opportunities and threats, it is necessary to conduct a SWOT analysis by GAP.
GAP At A Glance – GAP SWOT Analysis
Company: The Gap, Inc.
Founders: Donald Fisher | Doris F. Fisher
Year of establishment: 21 August 1969, San Francisco, California, US
CEO: Sonia Syngal
Headquarters: San Francisco, California, United States
Employees (Dec 2020): 135,000
Ticker Symbol: GPS
Annual Revenue (Dec 2020): US$13.8 Billion
Profit net income (Dec 2020): US$4.4 Billion
Products & Services: Clothing | Accessories | Personal care products
Company Website: www.gap.com
Top GAP Competitors
GAP SWOT Analysis – SWOT Analysis Of GAP
SWOT Analysis Of GAP analyzes the brand based on its strengths weak points, weaknesses, opportunities, and threats. With GAP SWOT Analysis it is clear that the advantages and disadvantages are internal factors, while threats and opportunities are external elements. Here we are going to talk about GAP SWOT Analysis. Below Is The Detailed SWOT Analysis Of GAP.
GAP Strengths – GAP SWOT Analysis
1. Global Brand Recognition & Multi brand Portfolio: The brand operates company-owned or franchised stores that operate in 43 countries. It also is able to ship orders online to more than 90 countries and regions. It is a well-known brand that employs around 135,000 people across the globe. The brand meets the customers’ requirements and desires all across international boundaries. Gap Inc. portfolio comprises of brands such as Gap Global, Old Navy Global, Banana Republic Global, Athleta, and Intermix. Intermix is the Banana Republic Global segment offers clothes, eyewear, jewelry as well as other items. Athleta provides women’s fitness apparel under the Gap brand. We have GapKids, Gap Maternity, Gap Fit and many more. Each of these brands are aimed at different segments of customers.
2. Diversity and equality within the branding: Equal rights have been the foundation of the company and the same values have been infused into the culture from the start.Marketing91 ensures that customers from all backgrounds feel comfortable inside the store as well as in the workplace. In Thomson Reuter’s diversity & inclusion index Gap Inc. ranks in the top 5.Gap believes that inclusion diversity, diversity and the possibility are essential to boost growth, to retain the best talent, and bring in new customers. In the year 2016, Gap Inc. was awarded the 2016 Catalyst Award for leadership on equal pay for equal work as well as a strong gender representation. This inclusion has contributed to creating an attractive image and trust for Gap Inc.
3. The most effective Supply chain: When it comes to providing chain, it concentrates on speed and flexibility, it utilizes techniques like the fabric-based platforming technique as well as a positioning method that utilizes the same fabric in different styles to accommodate different seasons. Gap Inc. also uses the concept of just-in-time to produce its products, with a third of the merchandise being made within a quarter, instead of the nine months that it was previously taking and also a streamlined inventory management.
4. Sustainable Business: Every pair of jeans purchased by a customer from Gap is produced using 20 percent less water than a traditional manufacturing process, thereby saving 65 million liters each year. The brand states that the fabric purchased by customers at Gap is more sustainably-sourced. Athleta also declares that by 2020 the majority of Athleta’s products are made from sustainable sources. In 2020 by 2020, one million women from communities and factories will graduate in the P.A.C.E.program. Gap Inc. also plans to reduce greenhouse gas emissions from its global owned and operated facility by 50percent in 2020.In all its efforts to achieve sustainable development, it’s tackling the future with a sense of creativity, vision and clear vision.
GAP Weaknesses – GAP SWOT Analysis
1. Brand popularity decreasing: The brand name of Gap is becoming less appealing and requires an improved understanding of the purpose. Due to a lackluster performance in sales Gap has shut down a lot of stores across the globe. Gap was once a symbol of “effortlessly cool”, but nowadays, it’s struggling to stand out as a brand that appeals to younger generations, and this is hurting the company sales. An unisex pair from Gap is $69 while similar-looking pair is available from Old Navy (with little polyester added) is $25.The popularity in the success of Old Navy has come at the cost of Gap.
2. Increasing Competition: Brands such as H&M, Forever21, and Zara are always improving their products and putting together a more customer-centric collection. They are all gaining traction in the marketplace is growing, however the gap appears to be remaining the same. The prevalence of online shopping as well as the increasing popularity of the fast casual segment has significantly affected sales for the brand. There is a fierce competition in the fashion sector and consumers are prone to shifting brands. The gap has to review it’s product offerings and create collections that will appeal to the younger generation of customers.
3. A limited product range: If customers enter a Gap shop, the only thing they’ll see is an array of V-neck t-shirts or sweaters, and the assortment of jeans. Gap sells nothing but the most basic but important and this method could have worked in the past, but now the consumers want more. They want something different. The same simple, not too flashy reliable style is re-used each year and it’s becoming boring. H&M, Forever21, offer similar items at a less expensive cost. They tried to market their basic image using the launch of a new campaign called “Dree Normal” but when the collection launched on the shelves, it did not do very well. The clothes were simple to draw any interest. Gap has to revise its offerings in order to create designs that are more in tune with the generation of millennials.
GAP Opportunities – GAP SWOT Analysis
1. World Market expansion with a focus upon Asia: The Philippines is a great fit to Old Navy’s goods because they have a strong connection to American Brands. Although the market is small in size but the middle class of the Philippines is flourishing and has great opportunities for retailers with a value proposition. Japanese buyers tend to buy products that last longer and the demand for low-cost clothing is growing which is why expanding the business is a smart idea. The market in China, Old Navy is among the most sought-after cheap western brand. These are new markets which have the potential to grow to purchase If Gap can effectively reach the right buyers It could be a success on China’s Asian Market.
2. Enhancement in the online commerce: Gap Inc. has worked well to establish its name in the online world. Gap Inc. uses a platform that sells every product line from different brands. This has increased brand’s recognition. A gap was able grow significantly from its online and mobile spaces. In the first quarter of the year it surpassed its goals of $3 billion online revenues. The company has invested heavily in native mobile applications and speeds up the loading speed of the website. The company has a program known as Gap cash, where customers will receive discounts and offers in addition. Gap has the capability to deliver online items to more than 90 countries. Gap has announced a brand new program that permits customers to purchase on the internet and then pick it up in stores and store the products for seven days. The company should concentrate on making the online experience seamless for customers, which can help them stay loyal.
3. Celebrity Endorsement: In 2016, Gap used Olivia Palermo who is an internationally renowned style icon. She was chosen as the first female style ambassador. This improved the public visibility of the brand and also improve its image of Gap as a brand. In her Gap-branded attire at the 2017 CDFA Awards in New York this helped to keep a larger following of celebrities to endorse. In the year 2017, Gap announced it was making a movie with famous celebrities such as Wiz Khalifa, Priyanka Chopra among others. This type of program creates new opportunities in the near future and positions Gap as a dynamic business. Studies show that celebrity endorsement of the brand could boost expansion, improve visibility, and attract younger customers’ attention.
4. It is the most popular Gap Athleta name: In the words of Forbes the Forbes report, activewear is the main factor driving growth in the clothing sector. According to Global Industry Analysts Inc., Global Industry Analysts Inc. the market for fitness and sports clothing sales will hit $231.7 billion in the world in 2024Athleta company has been doing extremely well and at a faster than the market. It is on the way to opening more stores and is quickly gaining ground. Social media engagement of the brand is excellent and is taking initiatives to encourage women all over the world. Gap Inc. has also constructed its own Innovation center that is working on technological manufacturing and sustainable innovation for active wear. With initiatives like this. Gap Inc. is very positive about its brand.
GAP Threats – GAP SWOT Analysis
1. The decrease in profit and sales: Gap brand recently revealed that sales at the store fell by 5%. The business has increasingly relied upon Old Navy and Athleta brand and is working to revitalize the Gap brand. The delays in deliveries caused inventory to grow in the beginning of 2018, which caused retailers to use discounts. The brand is unable to keep up with demand, even in the time when spending by consumers is growing. The amount of physical stores is turning out to be a burden for the brand since sales have decreased and consequently impacting margins. The speed of change and a specialized plan is necessary to revive the brand.
2. Management ineffective to make improvements in the business: The brand has made enhancements in its supply chain and is launching initiatives such as loyalty programs that are able to be utilized across all brands. Massive investments have been made in technology that helps employees replenish stocks, for example. Old Navy has also announced the addition of plus sizes in order to draw new customers. The company isn’t able to earn a profit even when the spending of customers is growing. The brand is not able to bring new and innovative designs the shelves, and does not have a viable operating model.
3. Competitors: Gap has struggled in its quest to enhance their performance because it is facing an intense competition from low-end fast-fashion apparel as well as the more expensive fine apparel brands. Brands such as Zara, H&M, and Forever21 are the primary competition for Gap. These brands can continuously increase their store traffic as well as increase the stock turnover. Gap is pursuing initiatives for revitalization, but the effects are not evident and it is constantly losing customers. Gap has launched the process of transformation that involves the development of the flexibility and efficiency of a business model. The company is in an uphill battle and has to rebuild its brand’s image.
GAP SWOT Analysis Template
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