Gap sold a lot of similar styles to Old Navy for a much higher price. Business Insider/Jessica Tyler
Gap is struggling to keep up with its sister stores.
Gap Inc., the parent company of Gap, Banana Republic, Old Navy, and Athleta, saw flat sales this quarter. Prior to this quarter, the company saw seven consecutive quarters of positive comparable sales growth.
The Gap brand itself is struggling — comparable sales were down 7% in the third quarter.
Gap discounts nearly everything in the store, threatening margins and, ultimately, making shoppers less likely to pay full-price. It also offers a lot of the same styles and quality clothing as its sister store Old Navy, but the prices are much higher at Gap.
“We are clearly not satisfied with the performance of Gap brand. We know this iconic brand is important to customers, and we are committed to taking the bold and necessary steps to ensure that it delivers value to shareholders,” Gap Inc. CEO Art Peck said in the company’s earnings release on Tuesday.
This is what we found when we visited a Gap store in New York City: