Gap Inc, one of the biggest players in the industry has seen a drop in its market share in the US from 5.1 per cent to 4.7 per cent over the past five years. This, despite the brand performing better than other casual brands. The apparel retail’s rapid shift to online space and store-based retailers’ foray in this arena being relatively slower means that the brand may not be able to reverse the drop soon. In fact, Gap Inc’s store consolidation strategy has made it almost certain that its market share will continue to go down. The company needs to strive hard to stay ahead of casual apparel brands as it can hardly recover its market share from fashion players.
Still a strong player
Gap holds less than 5 per cent market share, despite being one the bigger players in the US. This shows the diverse nature of the US apparel industry. This may seem a low share, but the company has grabbed this share with only three main brands in its arsenal. Brands that have a comparable or higher market share are multi-brand retail chains, general merchandise retailers and supermarkets who generally offer a number of national and private label brands.
After the US recession, Gap started losing buyers who moved quickly to fast-fashion brands. They moved away from casual clothing to affordable fashion wear. Gap’s merchandise was being viewed as less fashionable by consumers which had a negative impact on sales. The market share of the retailer fell from 5.11 per cent in 2009 to 4.34 per cent in 2012. And as fast fashion brands continue to gain ground Gap’s market share will continue to fall. But despite that Gap will continue to remain a strong player as specialty players such as Abercrombie, American Eagle, and Aeropostale are smaller compared to Gap. Thus, the company’s position looks strong, although it does seem that it’s losing its footing over the past few years with growing competition. Of course, Gap can continue its strong leadership position by smart inventory control, and bringing out trendy products in keeping with demand.
