Gap Orients Distribution Strategy Around E-Commerce and Off-Mall Stores

Gap’s packing its bags, saying its goodbyes, and leaving home behind—home being your nearest mall. Yesterday, Gap said it will...

• Close ~350 stores across its namesake and Banana Republic brands.
• Generate 80% of revenue from off-mall stores and e-commerce by 2023.

Emphasizing digital sales is retail’s Pomodoro Technique: It’s nothing new or particularly special, yet we’re still a little surprised when it works. In Q2, Gap gained 3.5 million new customers and its digital sales grew 95%.

Meanwhile, moving stores closer to grocers and nail salons has timely advantages. Open-air centers are more appealing to virus-wary consumers...and rent may be lower than what Simon currently says.

Another outlet: This one goes out to anyone who grew up at the Exchange instead of the mall. () Gap is also expanding its wholesale presence by partnering with 50+ stores on U.S. military bases.

My takeaway: Cutting underperforming distribution channels could bring Gap closer to its customer—but to keep them, it’ll need to take the same shears to its product mix.