Is GAP going to collapse across the board?

In the 10 years of Gap Group's struggle, Old Navy was once the most highly anticipated brand. Today, it is also framed.

On February 25, Gap Group released another disappointing financial report.

For the fiscal year ended January 30, 2015, Gap Group’s net profit was US$920 million, a year-on-year decrease of 27%. After the announcement, Gap shares fell 3.3% to close at $26.70.

The Gap Group’s expected EPS for FY16 was 2.20-2.25 USD, which was lower than the analyst’s forecast of 2.44 USD. This means that Gap Group still faces greater challenges in 2016.

Gap has been bad for the past year. Foreign media use “horrible” to describe the Gap Group's performance in 2015.

In June of last year, Gap announced that it would shut down 175 stores in North America that are underperforming, and with the North American market, this 18% of stores closed with 250 layoffs.

According to the Group's pre-disclosed sales results on February 9, same-store sales of Gap Inc. Group fell by 7% in the fourth quarter of FY2015 as of January 30, 2016, among which Gap, Banana Republic (Banana Republic), and Old The same-store sales of the three major brands of Navy (Old Navy) fell by 3%, 14%, and 8%, respectively, and there was a trend of collapse across the board.

In the article entitled "The story of GAP tells us that there are no good ends for young people" six months ago in the curiosity daily report, we analyzed Gap's popularity from the 1990s to the process of losing the market and losing its competitiveness. (See extended reading at the end of the article.)

"GAP has been abandoned by the vast middle market (mass market) because it first turned to the young market, waited until it admitted it was wrong, and tried to pull back to the middle market, but found that there was no middle market. "James Haking said in the book "Nonethology."

As a result, when you want to buy basic funds, you will go straight to Uniqlo; when you want to buy clothes that look good and don't get too expensive, you will go to Zara, or even cheaper H&M. But just passing by, it's hard to find a reason to walk into Gap.

The reasons why Gap has been criticized for a long time include: the product update cycle is too long and the design is not fashionable. Also, compared to H&M or Uniqlo, its price is not friendly.

Arthur Peck, Gap’s global CEO, summed up more issues, such as the frequent departures of senior management within the group, the unsuccessful overseas expansion, and the failure of US omni-channel services (receiving at stores, store appointments, store inventory, etc.).

Currently, Gap’s share in the U.S. apparel market has fallen to 4.7%, not as good as 5.4% for mid-market supermarket brand Target.