Will NFTs, Kanye West and high-fashion collabs help Gap get its groove back?
It has been decades since Gap drove fashion trends, but the chain clearly wants to get back to that place. In its most recent move in a more fashionable direction, the apparel retailer announced that it is getting in on trending technology in collaboration with a huge name in contemporary art.
On January 13, Gap launched its first “drop” of a collection of limited-edition non-fungible tokens (NFTs) created in conjunction with artist Brandon Sines, according to a press release. The NFTs are being made available through a blockchain called Tezos (which purports to be more environmentally sound than the more popular Ethereum).
Mr. Sines is the pop artist responsible for the Frank Ape character, which he has painted on murals throughout New York City, and has appeared in the Guggenheim Museum.
NFTs have emerged as a way to allow for art collecting in the digital world. By turning a digital image into an NFT, an artist establishes the NFT as the original version of the work, logged on a blockchain. The creator can then sell the NFT, which retains its value even if the image itself is otherwise copied and redistributed.
Gap has been making other moves recently to try to reestablish a hip brand identity.
The retailer has enjoyed sales success with Yeezy by Gap line and expects the brand to generate $1 billion in annual sales as early as next year. The chain dropped its first commercial for the Yeezy by Gap line this week.
CEO Sonia Syngal told analysts on Gap Inc.’s third quarter earnings call in November that the “Perfect Hoodie” from the Yeezy line “delivered the most sales by an item in a single day in gap.com history.”
“With over 70 percent of the Yeezy Gap customers shopping with us for the first time, this partnership is unlocking the power of a new audience for Gap, Gen Z plus Gen X men from diverse background(s),” said Ms. Syngal.
Gap, which began its collaboration with Kanye West in 2020, recently announced that it would bring in high-end fashion house Balenciaga to develop a product line with the rapper that will launch this June.
- Gap Launches Gamified Collectible NFT Experience to Activate Community, Creativity and Self-Expression – Gap Inc.
- Frank Ape – Frank Ape
- NFTs, explained – The Verge
- ‘You can gain everything and you can lose everything’ — here’s why experts remain skeptical about the NFT market – CNBC
- Gap (GPS) Q3 2021 Earnings Call Transcript – The Motley Fool
- Ye Releases “Heaven and Hell” Music Video, Yeezy Gap Debuts TV Commercial and Launches Hoodie Globally – Gap Inc.
- Kanye West – Heaven and Hell – YouTube
- Yeezy Gap Engineered by Balenciaga – Gap Inc.
- How To Get Your Hands On The Balenciaga X Yeezy Gap Collab In The UK – Bustle
Discussion Questions
DISCUSSION QUESTIONS: Do you think the steps Gap has been taking can make it a cool brand again? What more could Gap do to capitalize on the attention it gets from these moves?
Poll
Loading …BrainTrust
Melissa Minkow
Director, Retail Strategy, CI&T
Doug Garnett
President, Protonik
Gap partnering with the right brands and forward thinking strategies like incorporating Meta and NFTs will make the brand cool. But not cool enough to make a dent in overall revenues.
Gap has been known to have challenges in keeping the right talent and are in constant restructure mode. They need to work on setting themselves up with the right operating model and organizational structure to truly be impactful in the future of retail. They have an opportunity to truly make waves and just need to commit by rethinking the way they retail across their brands. Innovation is critical but having the right teams in place that have the right mindset and skills is imperative.
I wouldn’t bet on it. Has anyone seen sales numbers on that blue button-/zipper-less coat they put out last year? I saw it marked down but never heard any braggadocio about it. Can you say, grasping at straws?
I am far too old to predict whether the new assortments Gap has introduced will resonate with their target customers, but I have long felt a new approach to assortment planning was exactly what they needed to return to greater relevance. I am definitely bullish on NFTs and love the Brandon Sines collaboration, but might caution against putting too many eggs in the Yeezy basket. His line is hot right now, to be sure, but diversification will give them a buffer against the inevitable swings in consumer sentiment.
A new approach to assortment planning and rethinking the way product is created is critical. Partnering with Yeezy and other influencers is great, but what about the masses? I love that Gap is pushing this narrative, but I’d love to understand how they are going to make a dent in their bread & butter assortments.
When was Gap a cool brand to begin with? Coolness comes from brilliant fashion designers that are on top of trends which in many cases actually starts in APAC, not NA. Cool factor can be created from sports, music and fashion forward entertainment personalities wearing your goods. I’m sorry, but Kanye West is not a figure that confers a positive image on a brand, he is controversial and there are negative issues surrounding him including being named in a battery probe. Music talent creating their own line – that is a solid. Borrowing cool factor from a talent is fraught with issues and ultimately becomes a short-term bump and nothing more.
I love the fact that Gap is thinking so far out of the box as they push their evolution back to relevance. And at the same time I am highly skeptical about their choices of Kayne West and NFT’s to propel that evolution. At its peak Gap was as much about great marketing as it was about “fashion.” They were very much grounded in every day essentials at the time. That equation is now very old and tired. KW and NFTs certainly stand for contemporary marketing, but it feels like a tortoise trying to quickly evolve into a T-Rex. I admire the aspiration but, like I said, I’m skeptical.
If The Gap cannot solve their core merchandising problem, no amount of effort, at the margin, will right the ship. NFTs and celebrities can generate grand narratives, but numbers tell their tales. Sure, creatively explore programs around the edges, but don’t overlook the heart of the matter.
NFTs, collaborations and the like are all important and will be helpful to Gap. However when I walk into a Gap store – which I did the other evening – and it is so bland it makes wallpaper adhesive look exciting, these other things are unlikely to make much of a dent. Get the basics right, get the fundamentals in order, get a clear sense of direction and focus – and then add all the fancy new things. They are the icing on the cake, not the cake itself!
I agree with you Neil. Gap has to focus on fundamentals — it feels like they are trying way too hard to be “cool” while ignoring the blocking and tacking that drive P&L success.
Gap will honestly have to hire Ye as a permanent creative director in order for this impact to be lasting. An impressive boost is great, but what happens when the contracts are over? Additionally, stores, the website, and app need to be revamped to align with this branding, or it doesn’t even feel like the Gap brand, which means the association is lost for consumers. This strategy is a foundation, but a lot must be built on this foundation in order for it to be worth it.
These steps help to fill Gap’s strategic gaps with relevance, creativity and star power.
Kanye West’s influence and exclusive items help Gap resonate with new consumer segments and drive sales. Partnering with Balenciaga helps Gap democratize premium goods by making them more accessible to younger shoppers.
Innovating with NFTs and blockchain boosts Gap’s timely digital content and transparency.
To capitalize on these moves, Gap can reach more Gen Z communities with digital ads and content, focusing on TikTok, Instagram and livestreams.
One of the things we always hear about Gap is that the stores are tired and the merchandise is the same old, same old. I was a Gap store manager in the ’70s when the stores were cool; today I still see clothing on the sales floor that is similar to what we sold. It’s time to try something outrageously new.
That’s Kanye. He brings a fresh and different perspective to what you traditionally expect to find at Gap, and he brings his fans and followers along, too.
I hope the Balenciaga partnership works as well as designer partnerships work for Target. I like that the company is willing to try things that are considered “out there,” and I am not ready to write Gap off yet.
The problem with “cool” in a digital world is that it has a very, very, very short shelf life. As every one-hit wonder band knows, pop culture is fickle. It’s (relatively) easy to be “cool” once, but it is hard to be consistently cool. Partnering with this week’s hot artist is great, but what are you going to do the other 51 weeks of the year? As my fellow panelists have noted, walking into a Gap store is almost a sure cure for insomnia. If the decor package doesn’t put you to sleep, the “service” and inventory will. I think there is a world of difference between being popular/fashion acceptable and being cool, and I’m just not sure Gap ever was a cool brand.
Gap has had countless challenges with resonating with the next-gen. While at the surface NFTs, a collaboration with Kanye West, and other high fashion influencers may help drive some brand equity, Gap’s brand has suffered from fundamental and foundational execution challenges.
While leveraging TikTok and driving Gen Z-powered digital marketing campaigns will be a quick way to regain some relevance, fixing the merchandising, pricing, assortment, and trend-worthy mix challenges need to be a foundational and parallel strategy for this to be successful. The one challenge is to gain the Gen Zers’ attention. However the more significant challenge is to retain it with excellent execution, high-quality products, and a brand promise worthy of their loyalty.
I saw NFTs referred to as Dunning-Krugerands the other day because they give all the evidence of being short lived fad. That makes their appearance as a focus at the Gap seriously concerning. IF Gap returns to retail fundamentals and merely uses this as a headline then they might make progress. But if this is the core of a strategy, they will have failed again to find a way to return to health. Superficiality is not going to solve Gap’s problems.
Yesterday it was about J.C. Penney trying to become relevant without them ever having any relevance, in the way of being “it,” to begin with. Their current attempts at gains are further compounded by years of loss and, perhaps more importantly, a lackluster veneer. To the contrary, Gap was a “go to” brand for a while, but with an entire store (and chain) full of that which became their undoing: lackluster merchandise.
Now you can take pieces or categories here and there and “pop on rhinestones.” Which is, in effect, what these collabs are doing. But at the end of the day, you’re still working with the same ol’ same ol’ — dull garments.
More problematic is that the entire world of retail basics they very successfully ushered in — with followers who ended up taking the lead, like the H&Ms and Uniqlos (and who did it better, faster and cheaper) — has, itself, imploded. (Or more aptly, unraveled.)
So as others have said and I agree, they need to fix the foundation of their business first. And by realizing that blandness does not work for the masses. Whose hordes, bland though they might really be, are becoming more individualistic/tribal. Interestingly, and while they may or may not have pro-actively considered it, their current actions are as divisive as they are inclusive. Which shows you that retailers, especially larger ones, can’t find a “one size fits all” celebrity, or celebrated idea, to bring in (and back) customers like they did back in the day.
Maybe this should be about Gap thinking and acting more regionally; and not about the sameness of their wares from sea to sea; especially when it is clear there are differences between we, the people. (Which is not as damning as it sounds.) But that would take making and showcasing things (including personalities) for local markets — and surely not what a big, bland behemoth is or could be about.
That I had to look up “NFT” probably says a lot about my abilities to comment on this, but here goes: gim·mick/ˈɡimik/ a novel device or idea designed primarily to attract attention or increase appeal, often with little intrinsic value.
I don’t see it as a complement.
Any dead brand can make a comeback. So can Gap. But NFTs ain’t a great strategy to make Gap’s comeback cool. NFTs will grab customers’ attention once or twice and then it won’t be a point of attraction anymore. No strategy will work unless the products resonate with their customers. Remember Hush Puppies? They saw one of the worst declines in the 70s but made an awesome return in the late 90s. People were looking for shoes that give them retro style, and they made their product just perfect for that.
To capitalize on the attention, Gap needs to take a step back and analyze what exactly acts as the change agent and causes the tipping point. A tipping point can sway in both positive and negative directions. To avoid losses, it’s critical to identify those causes and establish complete control over them.