What the Future Holds for Gap Inc.
| David McDonaldson
| February 12, 2013
| MBA 895-2 Strategic Management
| Case Study 1 – GAP Inc.
Gap Inc. by now, most if not all shoppers in the United States have heard of or shopped in this clothing retailers’ store. Gap was founded in 1969 by a San Francisco husband and wife blue jeans retailer by the name of Don and Doris Fisher. They had a vision, and that vision was to “make it simple to find a pair of jeans.” Don Fisher didn’t start out with a successful business model. He had many successes and failures before becoming zealous about a retail store, which would become the Gap. Mr. Fisher ruminated what it would be like to have all sizes, colors, and styles of Levi jeans in one store after being unable to find a pair of Levis in a 31-in inseam length. Don had a working relationship with a Levi salesman. When the salesman leased some space in a building that Don owned to open a showroom, Don stated, “I enjoyed the energy the showroom brought to this old hotel.”… “America had a long and loyal romance with Levi products, especially Levi’s historic original 501 blue jeans.” (Bio) It was at this time that Don began to talk about the clothing industry. The first Gap store opened in San Francisco selling Levi’s, records and tapes. The Gap was not the first name that was considered. The original name for the store was simple “Pants and Discs.” It was the generation gap that was the inspiration for the name that was eventually given to the store, thought up by Don’s wife, Doris. It was a store that was to appeal to the 12- to-25- year-old in San Francisco. He concluded that there would be no rivalry for this style of merchant and in his words, “capture the greatest potential in sales” (Bio) with a retailer who devotes all their merchandise to pants. The Fishers delivered a new shopping experience to their customers. It was satisfying and enjoyable to shop at the Gap because they had a creative way of thinking about how to shop. The experience included fully-enclosed dressing rooms and display space on the wall to sell the merchandise. The public came to the store, they saw, they experienced, and they loved it. The company grew quickly and went public in 1973, engaging in rapid expansion. By the 1970’s the Fishers expanded their product line by adding active wear appealing to a broader range of customers. Gap wanted to expand from being a Levi’s only store and in 1972; becoming the first retailer in history. The Gap initiated its own private label of clothing. This is a model that has been copied many times over in the years since. With all of their success, the Fishers were very intelligent business people and they knew when it was time to recruit talent from the outside, in 1983 they hired Millard “Mickey” Drexler to be the company’s president. Mickey Drexler had studied at the Bronx High School of Science, City of College of New York, and University at Buffalo. He also received a MBA from Boston University. In the mid 70’s Mickey was a merchandising vice president of Abraham & Straus in Brooklyn, New York. With this history of merchandising made Mickey a shoe in for the position that could lead the Gap to the top of the market for fashion. (Gordon, 2005) Millard, or as many know him, “Mickey” Drexler grew up with fashion around him. Charles Drexler, his father, was a buyer of buttons and piece goods. He would have Mickey help him with his work on the weekends. Mickey received retail sales floor experience at Abraham & Straus, Bloomingdale’s, and Macy’s, however, he became disillusioned with the department store atmosphere. The idea of a store carrying its own label of clothing intrigued him. Mickey had the gut for retail fashion, he could tell what the public wanted before they knew it. He had a stint at Ann Taylor but was lured away by Don Fisher to “fix the Gap”. By the early 1980s The Gap had...
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