In response to the announcement that Gap Inc. is splitting its brand portfolio and closing more Gap stores, Maureen Hinton, Global Retail Research Director for GlobalData, a leading data and analytics company, offers her view:

“While Gap started the fashion trend for the US preppy style casual brands, others, such as Abercrombie & Fitch, which reports next week, have since taken over as the latest must-have logo brand. But their popularity is short. Ubiquity kills them off and fickle fashion followers move on to a new brand.

“Like Gap, Abercrombie & Fitch fell out of favour and has suffered negative sales and profit growth as a result. But it is not alone. UK brands that have emulated this American style, such as Superdry and Jack Wills, face the same problem; they have a short spell in the fashion sun, around three years, generating strong growth, then they wilt and have to evolve into a brand that can offer more than just a logo to bring in customers.

“These brands are neither sports brands, such as Adidas and Nike, or fashion brands such as Zara or H&M, and their casual clothing ranges can be bought anywhere at a fraction of the price without the logo. So when the logo goes out of fashion customers no longer see the value, and shift their spend elsewhere – which is one reason Old Navy is performing well – it offers good value.

“When Abercrombie & Fitch came to the UK in 2007, there were queues to get into its store, today there are no longer queues – instead there are queues at Supreme, the latest fashion must-have logo, and one that should take care it has a long term plan for the brand as it is reaching peak recognition.”