GAP Clothing: The fall from BELOVED all the way to INDIFFERENT

Posted on Posted in Beloved Brands in the Market

GAP Clothing was once a BELOVED Brand, back in the middle of the 1990s. It was loved by consumers, envied by marketers and revered in the retailing world.  In 1990, it celebrated it’s 1000th store opening and was the place to go for stylish trendy clothing at a reasonable price. At one point, GAP had an Inventory Rotation of “8 seasons” per year, just to keep up with the consumer’s desire to see new products as they walked through the GAP stores for the umpteenth time. Consumers couldn’t get enough of GAP.

Fast forward to 2011, GAP Clothing sales are down 19% this year and down over 25% since the peak of 2005. And they’ve just announced the closing of 200 stores–which will continue the downward spiral.   Who cares about inventory turns when people aren’t even walking into the stores?

This year, GAP filed a lawsuit against GAP Adventures saying they felt having the co-existance of the two brand names “caused confusion in the marketplace”.   Considering that GAP Adventures is having a record year and is one of the most BELOVED brands in the adventure travel business, you would think GAP Clothing would think that confusion was a good thing.   For GAP Clothing to be complaining about being mixed up with GAP Adventures feels like George Castanza complaining about being mixed up with George Clooney.

Brands ride THE LOVE CURVE, going from Indifferent to Like It to Love It and then it becomes a Brand For Life–at each stage gaining a more emotional consumer connection with the brand. GAP Clothing rode this curve all through the 70s and 80s and by 1995, it had achieved the enviable “Brand For Life” status, which very few brands achieve.

But GAP got greedy and forgot what made them great: trendy fashion for a stylish generation at a reasonable price. And who is the spokesperson for fashion:  the coolest people on earth…TEENAGERS of course. Every generation of Teens believes they are the most important people on earth and they want products that speak out for their generation. It’s all about them. They influence Music, Movies, TV Shows and Clothing and believe each has to speak directly to them and for them. Imagine being 15 in the late 90s, you’re walking in your favourite mall, trying to be as cool as can be, heading for your favourite clothing store. All of a sudden, you look up and your favourite clothing brand is now flanked by BABY GAP on one side and GAP MATERNITY on the other side. How could this brand speak for the teen generation, when your 2 year old nephews or your pregnant Aunt are wearing the same clothes you’re wearing?  GAP also forgot about feeding that desire for leading edge, trendy clothing–the whole reason for that “8 seasons” rotation of inventory.  Go into a GAP store this year, and you’ll realize how boring and drab the products have become.  In terms of the LOVE CURVE, GAP Clothing has slid from the BELOVED status to Like It all the way down to INDIFFERENT. No teenager today likes GAP. They don’t even care. Are you kidding me? Duh.

GAP is so confused as to what to do next. So what do brands do when they are confused? Well, they should look themselves right in the mirror, challenge themselves at the executive leadership team to address the issues directly with an honest assessment and a high willingness to change. That’s the ideal. Instead GAP did what a lot of brands do:  they changed their logo. Oh god!!! The logo change only lasted one week–such uproar that they pulled it so fast, no one really saw it.  So what did they do next? They closed 200 stores. Very strategic. Bu-bye GAP. Say hello to Benneton, Wranglers and Doc Martins  when you get to the obsolete stage.

A Truly Beloved Brand: G Adventures

Posted on Posted in Beloved Brands in the Market

REPRINTED FROM PROFIT MAGAZINE

Ask a communications expert about the wisdom of changing the name of a successful company, and you’ll get succinct advice: don’t. “Unless it’s completely irrelevant or legally necessary, or the name has become totally stagnant, I wouldn’t change your name because it’s such a massive undertaking,” says Mia Wedgbury, president of High Road Communications in Toronto.

But this fall, Toronto-based tour operator Gap Adventures was forced to do just that when a legal ruling in a trademark infringement lawsuit brought by Gap Inc. gave it three months to devise a new identity in the U.S. market. The apparel chain claimed the Canadian company was intentionally confusing consumers to boost its business. Bruce Poon Tip, the travel company’s founder, initially waved off the attack. “I didn’t see how people might think they were buying pants when they were buying adventure travel.” He had picked the name (which stands for Great Adventure People) in 1990 only after deciding the original moniker, Pathfinder, might produce confusion with the car brand.

But after a four-year legal battle that cost more than $5 million to fight, Poon Tip was tired of the distraction. Initially, he considered only changing the name in the U.S., which represents 14% of the company’s business. However, several factors argued for a global revamp. First, in Europe and Australia, a “gap year” denotes a year off between school and work, creating the suggestion the company catered to students. According to Branding 101, a global company must have a consistent image. Finally, Poon Tip thought Gap’s highly loyal customers would take a name change in stride. “I’ve never believed that the name matters,” he says. “It’s what you do that breathes life into your name.”

At it turned out, customers disagreed. When Toronto branding firm Level5 Strategic Advisors polled consumers, the results were stunning. A question asking for alternate name suggestions produced such aggressive opposition to a name change that Level5 took the question out mid-survey. The agency’s president David Kincaid compares consumers’ attachment to Gap to the intense passion fans feel for their favourite rock band. Adventure travel is a “highly emotionally driven category,” he says, and his research found a striking uniformity in how employees, customers and partners viewed the brand. That was the good news; the downside, warned Kincaid, was that a renaming would erode that brand equity.

It was a scary finding, Poon Tip says, but he pushed on. Over eight weeks, Gap’s marketing team and Level5 ran strategy workshops and “name-storming” sessions, with employees invited to contribute suggestions. Poon Tip had two favourites: G Adventures, which would be relatively low-hassle and allow the company to keep its G logo; and Yolo, an internal brand that’s an acronym for “you only live once.” Staff liked the idea of creating their own word, like Google or Geiko. Kincaid’s team, however, resisted Yolo, saying it would require too much explanation in the marketplace. Meanwhile, G Adventures didn’t make it past an early poll of company executives.

Level5 narrowed the options down to two: Planeterra, the already trademarked name of Gap’s non-profit foundation, and Go, an active word inherently linked to travel. Poon Tip realized that Go could also stand for “great ocean,” which is the English translation of the Dalai Lama, a significant figure for Poon Tip who inspired him to stick with the business during an early crisis. While both Go and Planeterra scored strongly, Go skyrocketed when consumers heard the story behind the name.

Go was a go. The company even bought the domain, at considerable cost. But Poon Tip started having second thoughts. It bothered him that some survey respondents found the name boring. “When they thought of it in relation to us, they thought it was unexciting,” he says. There were also lots of companies already using that name. Even the fact it was so specific to travel started to strike Poon Tip as too safe, and potentially limiting. He looked at other name changes, such as Overstock.com changing to O.co, and that took him back to G.

Not long after, he held a conference call with 18 global executives. He stated the case for Go and for G, then asked for opinions. His team leaned slightly toward Go. Though he went into the meeting split 50/50, it proved to be like the coin toss test: his reaction to the outcome showed him which way he really leaned. He especially liked that the word “go” is still present in the logo’s circle around the G but, likethe Fedex arrow hidden within its wordmark, it’s speaking only to those who know it’s there.

While the change is relatively small—the company is just dropping two letters, and keeping the Great Adventure People tagline—the logistical challenge is significant, says Wedgbury. “The name is how people find your brand,” she says, and there’s a risk of confusing the marketplace and losing clients, and, of course, the cost of changing everything from signage to the website to merchandise. The company’s dispersed operations complicate the picture. “If I’ve booked a trip with Gap and I suddenly I see a new company name when I arrive, that doesn’t instill confidence,” says Wedgbury. And since it’s a court-mandated change, an oversight, at least within the U.S., can have financial implications.

But it’s the soft costs that will be most complex, says Kincaid. “They need to make sure that every consumer touchpoint understands the reason behind the new name,” from employees at an Australian call centre to tour leaders in Peru. “This isn’t something you can dribble out. The most effective word in marketing is ‘new,’ but you only get one chance to say it.”

Since Gap isn’t required to rebrand outside the U.S., Poon Tip plans to roll out the name change over six to 12 months. The company has generally eschewed traditional advertising in favour of viral marketing and referrals, but this change, says acting global VP of marketing Cindy Zesk, “will present a new set of challenges.” Travel agents, who represent 70% of Gap’s bookings, will be the biggest one, she says. “So we’ll take it to a real personal level, with speaking engagements, personalized emails and phone call explaining why we’re doing this.” With consumers, she says, the company’s value proposition “is a way of life. It’s not something we can put in an advertising tagline.”

G Adventures, Poon Tip admits, tends to leave people cold until he explains his vision for spinoff brands such as GLodge (a property being built in the jungle of Peru) and GNation (a social networking platform). Like Apple’s ‘i’, the G offers limitless extendibility. Having to change your name after 21 years in business is “not an ideal situation,” he admits, “but we’re taking it as an opportunity.”

Nevertheless, he remains bitter about the legal fight. He still owns the gap.ca domain name. “I might sell it to a porn company.” He insists he’s not kidding.