Apparel brand Gap Inc. announced it appointed former Mattel Inc. president and chief operating officer Richard Dickson as its next chief executive officer. The move comes as the retailer continues to lose market share.
Gap’s portfolio of companies include: Old Navy, Gap, Banana Republic and Athleta. Dickson takes the helm on Aug. 22. The move comes as the storied brand struggles to boost sales and reduce overhead expenses. The retailer eliminated about 1,800 positions in April 2023 in addition to the jobs it cut in September 2022.
Gap’s online sales dropped 7.2% in 2022, according to Digital Commerce 360’s 2023 Top 1000 data. The retailer’s decline occurred while other Top 1000 apparel/accessories merchants increased online sales to $102.78 billion in 2022. Online sales for merchants in the category increased 5% in 2022. Most recently, Gap reported digital sales fell 9% in during the first quarter ended April 29, 2023. It also reported a net loss of $18.0 million for fiscal Q1.
A difficult year for apparel brands
Dickson, who was Mattel’s chief operating officer, helped revitalize Mattel’s iconic Barbie brand, including its box office movie, which has brought in $495.7 million worldwide.
“Dickson’s creative focus is a strategic asset to Gap as the company looks to reinvigorate its portfolio of brands,” Goldman Sachs analysts led by Brooke Roach wrote to Bloomberg. Gap, like Barbie, was once an iconic American brand, synonymous with denim and crisp white T-shirts. But its stock price peaked in 1999, and all four of its brands — Gap, Old Navy, Banana Republic and Athleta — have struggled to maintain sales growth.
Dickson has a difficult task ahead.
“As history has shown, Gap’s major investors can be resistant to adaptation, and exert too much control over the direction of the company,” Neil Saunders, managing director at data analytics and consulting firm GlobalData, told Bloomberg. “In our view, there is no point bringing in good people if you don’t allow them the scope to shake things up.”
Gap Inc. ranks No. 20 in the Top 1000. The database is Digital Commerce 360’s ranking of the largest North American online retailers. Mattel Inc. ranks No. 200.
Bloomberg News contributed to this report.
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