scorecardGap is struggling to keep up with its sister brands - we visited the store and saw why
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Gap is struggling to keep up with its sister brands - we visited the store and saw why

Gap is struggling to keep up with its sister brands - we visited the store and saw why
Retail1 min read
Gap sold a lot of similar styles to Old Navy for a much higher price.    Business Insider/Jessica Tyler

  • Gap is struggling to keep up with its sister stores Old Navy, Banana Republic, and Athleta.
  • Gap Inc,. saw 2% sales growth overall, but the Gap brand reported comparable sales were down 5% this quarter.
  • We visited a Gap store to see why it's struggling.

Gap is struggling to keep up with its sister stores.

Gap Inc., the parent company of Gap, Banana Republic, Old Navy, and Athleta, saw 2% sales growth overall, with growth spearheaded by Old Navy and Athleta. It was the seventh consecutive quarter of positive comparable sales growth for the company.

But the Gap brand itself is struggling - comparable sales were down 5% this quarter. "A rising economic tide does float all retail boats, but it cannot float those with holes in them and, in our view, Gap is still a very leaky vessel," Neil Saunders, Managing Director of GlobalData Retail, told Retail Dive in an email.

Gap makes the mistake of discounting nearly everything in the store, threatening margins and making shoppers less likely to pay full price. It also offers a lot of the same styles and quality clothing as it's sister store Old Navy, but the prices are much higher at Gap.

But Gap CEO Art Peck said in an earnings call last Thursday, "Quarter-by-quarter, we expect performance to improve, and we believe the worst is behind us."

This is what we found when we visited a Gap in NYC.

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