Blog: Leonie BarrieGap goes back to its denim roots

Leonie Barrie | 18 August 2009

A two-year turnaround at Gap Inc has come full-circle as the US retailer goes back to its roots as a jeans specialist and pins its hopes on a relaunched upmarket denim line to boost sales.

But will the new styling and better-fitting 1969 Premium Jeans be enough to lure back shoppers into its stores – and more importantly – part with their cash?

Analysts seem divided on the idea. While some see the move as a great way for Gap to snare customers who have been unable to afford to trade up to premium denim lines, others fear the retailer has missed the boat, with rivals like Levi Strauss already selling top-end lines.

But Gap will no doubt take comfort from research that suggests the premium jeans market is a bright spot in a low season, and that sales have continued to grow this year despite the downturn in consumer spending.

As NPD Group’s chief industry analyst Marshal Cohen points out: “With the newfound focus on fit by some of the commodity brands coupled with women’s never ending quest for the perfect pair of jeans, the passion for denim is alive and well.”

Gap, which has managed to boost margins by trimming costs and streamlining operations but still struggles to lift sales, must hope this quest will now include its stores too.

 


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