1. Christopher Cannon, Adam Davis, Lu Mei, Marketing 300 Daniel Montgomery & Chloe ZhangPresentation

2. Agenda Bridging the Gap in History Current Big Picture Analysis New Big Picture Analysis Questions & Discussion 3. Bridging the Gap in History 1969 in San Francisco The Perfect Fitting Jean Levi to Gap jeans Foreign Expansion Doris and Don Fisher, Gap Founders 4. Gap Stock Troubles Gap, Inc.s stock troubles since 2010. Source: finance.yahoo.com 5. Gap Inc. 6. What Do Consumers Think?When you think of Gap,When I go to Gap, I what comes to mind?buy ___________.Men and women in 30s vs. KhakisyouthfulBlue jeansMiddleclass vs. inexpensive Dress shirtsBoring vs. style T-shirts Classic vs. classSweaters 7. Other Survey ResultsWhy do you shop at Gap? Simple, natural color, timeless clothing, only for jeansWhy dont you shop at Gap? Clothes do not fit me, baggy, boring, plain, no bargainsRange:Avg. low: Age12-20 16Range Range: Avg. high:25-60 44 8. Current Big PictureBusiness Entity Competence GoalsObjectiveMarketingObjectiveSource of VolumeSTP Segment Target Position ExecuteProductPricePlace Promotion 9. Business Objective Gap brand, a part of Gap Inc. Entity Domestic Division Core Ability to create classic clothingCompetence Regain position and relevance in the market Goals Reduce dependence at home and expand internationally 10. Marketing Objective & Source of VolumeAcquisition Focus on minorities Focus on 25-30 year oldsSteal Share Designer jeans 11. Segmenting, Targeting & Positioning Males & FemalesSegment 25-35 years oldTarget Tangella Jones GAP is an affordable yetPositionclassic clothing style 12. Meet Tangella JonesTangella Jones 27 years old Graduated from the Universityof Michigans Ross School ofBusiness HR personnel consultant for alarge firm Lives in a trendy one-bedroomflat in downtown Chicago Passionate socialite 13. Current Ad Campaign 1969 Premium Jeans Campaign Start a conversation about the brand Commercials: give a behind-the-scenes feel to thedesign process, emphasize the brands Los Angelesheritage Purpose: show that Gap makes cheaper alternativesto high-end designer jeans 14. Ad Clip for 1969 Premium Jeans 15. Current 5-box PositionGap makesGaps clothing isGap jeans are toocheaper as good as boring to wear alternatives toclothing from ahigh-end jeansdesigner companyWhen I want high- When I want jeansend designer from a designer clothing, Ill buylabel, I will buy them from aones that are justdesigner company as good from Gap 16. Execution: The 4 Ps Product Price Trendy Upper clothingmiddle class Place Promotion Closing 1969 U.S. stores Jeans 17. Summary of Current Big PictureBusiness Entity Competence GoalsObjectiveMarketingObjectiveSource of VolumeSTP Segment Target Position ExecuteProductPricePlace Promotion 18. Flaws with Acquisition Survey ResponsesRange:Avg. low:Age 12-20 16 RangeRange:Avg. high:25-6044 Instead of targeting the younger range of its 25-35year old demographic Itshould be targeting the older demographics of 30-45year olds. 19. Flaws with Acquisition Attempting acquisition while closing stores Inorder to reduce dependence at home, Gap have decided to close 21% of their domestic Gap stores Closing Gap Stores21% Gap stores to close by 2013 79% Gap stores to remain open Shouldbe focusing on retaining current customer base while closing down its storesSource: http://online.wsj.com/article/SB10001424052970204002304576628953628772370.html?mod=dist_smartbrief 20. Flaws with Steal Share Gap is not a designer brand Gaprepresents the central anchor division with extensive selections of classically-styled, high quality, casual apparel at moderate price points 21. New Marketing Strategy: R & SDRetentionStimulate Demand Retain current New ad campaigncustomer base New commercialinstead of targeting designyounger audience Target Change to30-45 years 22. Changing Targets: New Shirley Wilson 38 years old Married for 12 years Mother of two teenage boys Works part-time as a realestate agent When she is not busy with herchildren, enjoys spending timewith her friends Does not have much time to shopbut still likes to look put-together 23. New 5-box PositionGaps clothing isGap offers Gap has options affordable andmainly for teens for my entire essential clothing forand young adultsan adult wardrobe wardrobeIm not interestedWhen I want newin Gap clothing clothes, I shop atfor my wardrobe Gap 24. New Ad Campaign Bring back what Gap is remembered as Back to Basics Blue jeans and white tees 25. Commercials: New Suggestions Gap has featured over 308 celebrities of variousstature in their campaigns New celebrity endorsers: Brad Pitt and Angelia Jolie Family-oriented Older audience 26. Foreign Market Strategy Continue Acquisition Strategy International growth seems promising In April 2011, Gap, Inc. decided to combine theirinternational operations into one division Plan to expand their number of Chinese stores from 6 to 45by the end of 2012 as well as open a few stores in Italy 27. A Gap in the MarketGap, Inc. Q3 (2011) sales by divisionGap, Inc. Q3 (2011) Sales by Division (United States only)(worldwide)0%4% Gap18%Gap20%34% 40% Old NavyOld Navy Banana Republic38%Banana Republic46% Other Other (Piperlime, Athleta, wholesal (Piperlime, Athleta, wholesal e & franchise)e & franchise)Sales in millionsSales in millions Gap: $819 Gap: $1,419 Old Navy: $1105, Old Navy: $1,383 Banana Republic: $495 Banana Republic: $634 Other: negligible Other: $149Source: http://www.gapinc.com/content/dam/gapincsite/documents/GPS_Quarterly_Sales.pdf 28. Summary of Current Big PictureBusiness Entity Competence GoalsObjectiveMarketingObjectiveSource of VolumeSTP Segment Target Position ExecuteProductPricePlace Promotion