Dawn Robertson’s is the latest head to roll over at Gap (GPS), today stepping down as president of budget clothing brand, Old Navy, “by mutual decision”, according to the AP.
It’s been a rocky few years for Gap, which doesn’t seem to have adapted very well to the new global brand environment. It’s undergone a series of management reshuffles (Paul Pressler stood down as Gap CEO just over a year ago; Old Navy’s innovation champion Ivy Ross also left in Jan ‘07). But as Gap’s flagship store and offering have continued to less than wow consumers, Old Navy has become even less differentiated in the marketplace. Despite seemingly ubiquitous holiday advertising touting its cheap, cheap wares, same-store sales for Old Navy were down by 5% in its most recent quarter.
Since last July, Gap’s been headed up by Glenn Murphy, previously Chairman and Chief Executive Officer of Shoppers Drug Mart. Now I haven’t met or spoken with Murphy, but this quote from the AP story, that his “first seven months on the job have been marked by cost cutting and better inventory controls that have helped fatten the company’s profits even though sales have continued to erode” rings alarm bells.
And the fact that this year alone, members of the founding/ruling Fisher family have sold some 7.76 million shares (worth around $102 million) also indicates that some insiders aren’t too bullish about the future. Ok, so 8 million or so shares is a drop in the ocean of the 751 million shares available. But cutting costs and trimming fat can only ever be a part of a solution: Long-term innovation requires long-term thinking. And in a fashion retail context that means looking at the design of everything from clothing to stores.
What comes next? The Bloomberg Businessweek Innovation and Design blog chronicles new tools for creativity and collaboration, innovation case studies in both the corporate and social sectors, and the new ideas that have the power to change the way things have always been done.