Gap Inc Interim Report

1.0 Company Strategy Gap Inc. owns and operates five brands and over 3,200 stores in more than 40 countries worldwide. Of the four Porter’s Generic Competitive Strategies, Gap Inc. falls under the differentiation category because the San Francisco based company sells 5 different brands stretching itself to reach every market in the fashion industry differentiating itself from its mono-market serving competitors. Competitors like H&M (Gap), Macy’s (Piperlime), J.Crew (Banana Republic), Aeropostale (Old Navy), and Lululemon (Athleta) only sell specific styles of clothes to specific market segments. Gap Inc.’s chosen strategy is appropriate in the fashion/retail industry because the more different or stylish the clothes, the more market share Gap Inc. will gain. The market is saturated with thousands of other clothing retailers competing for the same market share. All of Gap Inc.’s companies reach a wide variety of different markets: Gap targets the stylish urban fashion; Banana Republic serves the upper middle class with quality professional and casual wear; Old Navy attracts the cost conscious consumers with their low cost strategy store; Piperlime competes with big department stores such as Nordstrom and Dillard’s; and Athleta sweeps up women’s sports apparel. Since the fashion industry is an enormous market with many different outlets and an unsteady economic environment, the need to differentiate a company from other corporations to stand out with a complete lineup is necessary to participate in the global competition. One of Gap Inc.’s many strengths is the copious amount of retail store locations for consumers to easily reach. If a consumer opens a Gap Inc. credit card, customers can use at any of the five stores and receive discounts by achieving points and always a percentage off your purchase. Another strength is the established brand with one of the world’s most commonly recognized logos. Without that brand presence, differentiation from other

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