UK Retailer Next And Gap Form Joint Venture To Keep Gap’s Brand Alive In The UK

The UK business of the US struggling fashion giant Gap has been leased a new lease of life with a joint venture formation with UK retailer Next, according to which Gap’s UK website will be managed by Next while also placing concessions in some stores.

Under the JV, some of Gap’s physical presence on the High Street would also be preserved, even though Gap had announced in July of closure of all its stores in the UK. 

This partnership with Next is similar to the one that was signed earlier this year with clothing brand Reiss. The brands available on its online platform are also being expanded by Next.

Other fashion brands’ e-commerce operations can be run on its “Total” platform, and the operations include customer service, payment systems and logistics. The platform also hosts the Victoria’s Secret and Childsplay Clothing brands.

When using the platform, creative control of their websites is allowed to be retained by fashion brands as well as keeping their existing URLs, such as Gap.co.uk. But Next’s distribution centres and call centres will run all back-end operations.

51 per cent of the joint venture will be owned by Next while the rest 49 per cent will be owned by Gap. Customers of Gap will also be able to use the click-and-collect service at 500 stores of Next according to the deal.

“Gap is partnering with Next, one of the UK’s leading online clothing retailers, to amplify our omnichannel business and meet our customers in UK & Ireland where they are shopping now,” said Gap Global’s chief executive Mark Breitbard.

The deal is Gap’s “best shot” at reviving its brand, believes Natalie Berg, a retail analyst and founder of NBK Retail.

“The Gap brand might have lost its way but it’s still a brand with a lot of heritage,” she told the media. “The uncomfortable truth is that they had way too many stores.

“What Next is doing featuring it, as a shop within a shop, does generate excitement and make consumers want to go into the store,” she added.

Next and Gap are both middle-tier High Street brands and have been rivals for years targeting the same demographics of shoppers which makes the teaming up of the two companies somewhat ironic, she said.

“The pandemic has created strange bed fellows – who would have thought Next and Gap would have come together a few years ago?”

Analysts credit Gap with shifting cultural norms around clothes and the company has been instrumental in making laidback clothes such as hoodies, sweatshirts, T-shirts, khaki trousers, jeans and polo shirts socially acceptable for customers of all ages. After its beginning in 1969, Gap had expanded rapidly during its heyday period up until the late 1990s.

The company had opened its first store in London in 1987 and had 123 stores in the UK by 2013.

But with shoppers shifting to online sale channels in recent years, it has found it difficult to adjust while customers were also put off by the never-ending sales.

(Adapted from BBC.com)

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s