Gap ad campaigns blamed for losses

LONDON - Ineffective advertising has been blamed as part of the reason behind clothes store Gap's recent poor performance, as shares in the retailer are downgraded.

Prudential Securities retail analyst Stacy Pak lowered Gap's investment rating to "sell" from "hold" after predicting poor Christmas sales.

The move comes after Gap reported its recent third-quarter loss of £127m, its first loss in 10 years. Pak blamed the ineffective advertising and poorly designed winter merchandise as the reasons behind the downgrade.

Gap, the 32-year-old company once famed for its hip dress-down image and ads, has turned to celebrities in an effort to boost the brand's image. Its new work, airing in the run-up to Christmas, features singers Alanis Morissette, Sheryl Crow and Seal.

In the commercial, the Gap-clad singers perform a version of the 1970s Supertramp song Give a Little Bit. The new Gap tagline is "Give your gift".

The move to using celebrities has been accused of being ineffective and stale. Gap has also admitted that it has lost sight of its brand positioning by focusing on trends.

Gap is also facing competition from cheaper high-street retailers such as H&M, Zara and Mango.

If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the Forum here.

Sylvia Westall, recommends


Read more