GAP Competitive Analysis

915 words (4 pages) Essay in Marketing

14/07/17 Marketing Reference this

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Information resources: The research has been based on industry and marketing information from Mintel, Verdict Research, and Fame, which has been analyzed using different strategic theoretical frameworks such as the PESTEL analysis, Porter’s completive forces and blue ocean strategies, among others.

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(2) The overall strategic position of GAP Inc. in UK:

The essay is mainly focused on two of it’s the sub brand of GAP Inc., which are GAP, and Banana Republic, analyzing the strategy of both operating situation.

what are the advantages, such as the growth recent fiscal year 2009, market share? Distribution channels? Supply chain network?

What are the disadvantages?

What are the strategies that GAP Inc. should take? i.e. Gap needs to change the product to offer to a more fashionable and differentiated fashion one and turn to its initial brand identity of offering fashion forward apparel to a “safe” fashion consumer.

Introduction

(1) Fashion retail market

The macro environment of fashion retail market.

“Disposable fashion is dead”, says Carl McPhail, which means the consumers will more value the quality and the sustainable of the clothes.

E-commerce trend

Market demand: strong?

The whole world value chain is changed

(2) The purpose of the essay

The purpose of the essay is to assess Gap competitive and strategic situation given this new market structure. This analysis will be based on the different strategic and marketing theoretical frameworks, in order to give the necessary business recommendations to the company for succeed in the UK market.

(3) The structure of the essay

This paper is organized in 4 sections.

The first section evaluates the main literature and analytical frameworks that will be used along this research.

The second section presents the Gap case study in terms of the company’s background, the underperforming areas, and a thorough strategic and competitive evaluation of the external and internal forces that affect this company.

The thirds part states the formulation of the recommendation strategies based on the strategic situation analysis of the company.

The final section consists of the conclusions of the research

Theoretical framework

The theoretical framework is mainly based on Johnson et al. (2008), to analyze the strategic position and strategic choices of a company, it is necessary to evaluate the external and internal environment that affects the organization, as the strategic performance of an organization depends on the matches between its internal resources and capabilities and the opportunities and threats that are present in the environment (Day and Wensley, 1988, Porter 1991, Hunt, 2000).

  • PESTEL
  • Porter’s five forces
  • Blue ocean strategy

And all the theories are concluded into the framework of SWOT as the overall analysis of the case

The above analysis will help determine what competitive strategies to adopt in order to gain a sustainable advantage in UK market.

Gap – Case study

Background

The Gap Inc., a brand that had been incorporated in the USA. As a global specialty retailer, the company’s range of clothing is based on traditional US casual clothing, with a focus on t-shirts, hooded tops, trousers and denim. It has 142 GAP retail stores in the UK. GAP is positioned for a wide range of customers through its product lines, which including Gap, GapKids, babyGap, GapMaternity and GapBody, and offers iconic American style for all age who are looking for something with good quality and classic style. The company also extended its range over the years to include ranges such as Gap Maternity, GapKids, babyGap and GapBody by the end of the review period. (Euromonitor International, 2010) For the children’s wear sector, the company also teamed up with UK designer Stella McCartney in order to produce a range for its Baby Gap and GapKids Outlets.

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Gap was once considered to be the foremost US fashion brand in the UK, with a Gap Hoodie being an obligatory wardrobe staple for many fashionable consumers. However, this positioning slipped towards the end of march 2010, and the brand had to compete with an increasing number of US brands for fashion-conscious followers, such as Abercrombie & Fitch and its sister brand Hollister. In addition Jack Wills, a British casual wear outfitter, became increasingly popular with younger consumers, with who Gap was traditionally popular (Euromonitor International, 2010). “The retailer built its global growth on basics, but has struggled to rival fast fashion.” (Jeremy Lee, 2008 p19). Gap operate inside the UK market that is seeking for added value that more than just basic and sustainable, and competitors within the fashion market are dynamic and drastic as well.

One hurdle to Gap’s growth was its reluctance to operate within dynamic and remunerative internet retailing, which largely inhibited its growth in a long-term. Without any option to buy Gap clothing and footwear online, many will not wait until their next trip to the high street to buy Gap jeans. They will instead simply purchase jeans online from another retailer. Gap’s decision to partner with Asos.com and sell its goods online indicates that the company is aware that it is lacking in this channel. Consequently, Gap may launch its own UK internet retailing site in the near future, should its arrangement with Asos.com prove fruitful.

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