Gap Sees Many Opportunities to Build Customer Loyalty

Gap CEO Arthur Peck is committed to turning things around at the iconic company, restoring widespread brand loyalty. Peck believes there are many opportunities on the customer side.

“On the customer side, we see a continuing opportunity to improve engagement and build loyalty, really by continuing to be focused on the customer experiences, and it’s an experience in our stores where we have a responsibility to deliver a compelling experience that our customers can’t get any place else, and it’s the digital experience and it’s how those two things are connected together,” he explained at the company’s recent first-quarter earnings conference call.

Mobile customer engagement is a key priority for Gap.

“We are relentlessly focused on mobile as traffic continues to move to a mobile device,” Peck added. “We launched our native mobile apps starting with Old Navy very recently to improve the customer experience and we’ve already seen customers rate those apps as materially better than the experience that we were delivering on a web-based app just several weeks ago.”

Another ongoing, but critical focus is product. Peck believes that, if the company doesn’t get this right, it won’t win in the end.

“We’re well on the way and well into the journey of enhancing and evolving our product capabilities,” he added. “We have continued to do work to solidify the fit to enhance the quality to improve the value relationship of our products and to use responsive capabilities to ensure that our products are on trend and that we can deliver units into the market share opportunities that we see. Our brands are iconic and they are legitimately and objectively loved by our consumers and we continue to invest in the plan that I've been talking to you about now for many quarters to strengthen our relevance to rebuild and enhance our product capabilities and to deliver an exceptional customer experience to both our stores and our digital assets.”

Peck was pleased with the first-quarter numbers: Comparable sales increased 2 percent compared to a 5 percent decrease last year in the same period; and net sales were $3.4 billion, about flat to the first quarter of fiscal year 2016.

“We’re also leveraging fabric platforming and importantly, we are working with fewer vendors more deeply,” Peck said. “These partnerships have been key to enabling us to work faster to change faster and to also respond to demand.”

Chirpify CEO Chris Teso weighed in on Gap’s current situation.

“The next revolution in building loyalty and engagement will be through maximizing the brand’s mobile and social media experiences with customers,” Teso explained. “In this vein, the Gap is taking useful steps forward with its native mobile app experiences that integrate the concept of a Wallet and reward tracking. While the Gap now has a useful mobile platform for facilitating an engagement-based value exchange, it still lags behind other brands that have modernized their loyalty programs by rewarding for engagement, not just spend. This is important as today’s consumers have a clear understanding that they provide value to the brand through their participation and social advocacy (not just money spent) and they want to be rewarded accordingly.”

Recent Content

Membership and Pricing

Videos and podcasts

Membership and Pricing