Image Courtesy of Gap Inc.
The crowded beauty and personal care segment is about to see another entrant into the space. According to a Sept. 4 press release, Gap intends to enter the market this year, also expanding its existing accessories business while doing so.
Citing its resilience and a more sure financial footing, Gap indicated that — with momentum on its side — it was seeking to capitalize on a market (worth more than $100 billion in the U.S. as of 2025, per Euromonitor) it saw both quickly growing and resistant to contemporary macroeconomic headwinds.
"Gap Inc. sees a clear and meaningful opportunity to expand into this category with plans for a phased launch, starting with an initial test-and-learn expression at Old Navy later this fall. This will include 150 Old Navy stores featuring a curated assortment of beauty and personal care products, with select stores offering dedicated shop-in-shops and Beauty Associates," the company wrote.
"In 2026, the company plans to seed to scale its Old Navy beauty business, as well as launch brand-right expressions across the portfolio," it added.
Gap Stock Rises, Expansion Signals New Direction
Perhaps as a result of the announcement of its expansion plans, Gap stock rose modestly — up nearly 5% as of 12:30 p.m. ET — with the effort being part of a new direction ushered in by CEO Richard Dickson, as Invezz reporter Vatsala Gaur outlined.
Dickson, who took the helm at Gap in August 2023 following a period overseeing the reinvigoration of several core properties with Mattel, emphasized the importance of stabilizing its embattled core apparel business before targeting growth in nearby categories.
Now, however, with Gap showing wide-ranging sales growth, the beauty, personal care, and accessories segments seem a sensible next step for the apparel retailer. Gaur quoted Dickson on the subject:
“We have the credibility with consumers to start to venture into categories adjacent to our core,” Dickson said.
Bolstering this play: An internal survey reportedly indicated that 70% of existing Gap customers were interested in buying beauty items from the retailer.
Private Label and Third-Party Brands To Share Shelf Space, But Competition Exists
According to Gaur, some of the ~150 Old Navy stores to play host to the beauty and personal care sales experiment will see products near checkout lanes, while a smaller group of about 45 locations will have dedicated space for the category, along with beauty advisors on hand.
Private label Old Navy-branded body mist, body wash, and lotions will be sharing shelf space with third party products coming from brands such as E.l.f., Mixik, TonyMoly, and Mario Badescu.
However, Gap is a bit late to the party. Kohl's has had Sephora store-in-store placements for some time now, and Target made an effort to pair up with Ulta Beauty in a deal which eventually unraveled. High-end retailers such as Chanel and Louis Vuitton have already moved into the beauty and personal care business, as have Gap's direct competitors Abercrombie & Fitch and Urban Outfitters.
On the other hand, as Gaur highlighted, Dickson has a history in the segment, having served as a beauty buyer for Bloomingdale's in addition to co-founding Gloss — an online cosmetics retailer which was acquired by Estée Lauder in 2000. This experience could serve to give Gap a competitive edge in the days to come.