With The Gap in brand freefall it is ironic that the reasons for its current problems are related to the original reasons for its success in the 70's.
First comes the Christmas shopping. Then the January sales. And now we get excuses from all the brands that underperformed during this all-important festive period.
Chief executives will blame anything from global warming to the price of oil to the popularity of flat-screen TVs for their seasonal failure to sell more goods. Anything, that is, other than the real reason: their marketing sucked.
Only the brands that are really in trouble actually admit the truth. At Gap, chief executive Paul Pressler confessed that he was 'deeply disappointed' with another dismal trading period and laid the blame squarely on problems with the brand. Pressler went on to announce an immediate review of the company's brand strategy.
The problem for Pressler is that he has already done this. Barely six months ago, Gap tried to revitalise its brand under the slogan 'Back to basics'. Stores were updated, windows redesigned, product design revisited and the ad campaign refreshed.
In fact, Pressler has done almost everything he can to fix Gap's gradually declining fortunes over the past two years. Working with its agency, Leo Burnett USA, the firm has conducted extensive focus-group and survey research to understand the market's needs. Based on this, it has segmented the market into behavioural segments including 'updated classic' and 'style-conscious' shoppers. There have been widespread changes in store layout and product design. It's an almost textbook approach. So why does the brand continue to decline?
Gap has failed in one of the most fundamental but often overlooked stages in the marketing process: targeting. The purpose of segmenting a market is not to then target all the segments. Targeting means focusing on a few customers and rejecting the rest. Visit any Gap store and it becomes clear that the brand is built on an impossible premise: to be all things to all people all the time. The result is not successful sales figures and market domination; it's the opposite.
To sell more, a retailer almost always has to target fewer people. That is a gutsy move for any company, but especially one with declining traffic and stockpiles of excess stock. Nonetheless, it is a marketing imperative.
Ironically, this was the founding principle of Gap when it was created in 1969. Co-founder Donald Fisher identified a new generation of consumers who were not being given what they wanted by the older generation who ran the clothing stores. Gap, which was named after the gulf between these demographic groups, built its initial success on very clearly targeting one specific market segment while excluding another.
It is also a guiding principle for many of Gap's more successful rivals today. Abercrombie & Fitch has gradually supplanted Gap as a destination store for young Americans in search of casual clothing. When chief executive Mike Jeffries was asked about A&F's target customers, he was brutally clear. 'In every school there are the cool and popular kids, and then there are the not-so-cool kids,' he said. 'We go after the cool kids. We go after the attractive all-American kid with a great attitude and a lot of friends. A lot of people don't belong (in our clothes), and they can't belong. Are we exclusionary? Absolutely.'
It may not be the most socially inclusive statement, but it is absolutely the right marketing message. Jeffries was almost certainly referring to Gap when he pointed out that there was no alternative to this kind of focus. 'Companies that are in trouble are trying to target everybody: young, old, fat, skinny,' he said. 'Then you become totally vanilla. You don't alienate anybody, but you don't excite anybody, either.'
