This has been a disastrous quarter for Gap and one during which all of its main engines not only stalled, but went into reverse.

Even the usually reliable Old Navy brand struggled, with sales shrinking compared with the prior year.

Most worryingly, while the latest April numbers are likely impacted by the earlier Easter, they nevertheless show that all brands failed to gain any momentum as the quarter progressed. Indeed, in the case of Old Navy, the sales slip actually accelerated.

The troubles at Gap are well documented. The central issue is that it is creatively dull and does very little to change collections from season to season or year to year.

As a result, it has become increasingly reliant on customers buying on a replacement cycle rather than being inspired to buy new products.

This, in turn, leads to it stimulating sales by the use of extensive discounting, which then discourages consumers from buying at full price.

“Gap has become increasingly reliant on customers buying on a replacement cycle rather than being inspired to buy new products”

Neil Saunders, Conlumino

Gap shows no signs of getting out of this viscous cycle.

Banana Republic has gone into reverse since the departure of creative director Marissa Webb.

While Webb’s attempts to revitalise the chain did not bear immediate fruit, we believe that she was not given sufficient time in the job and, much like the departure of fellow creative director Rebekka Bay, her leaving signifies that Gap has both a problem with change and with giving competent people the scope to get on with the job in hand.

There is now a sense that Banana Republic has lost its way. Its lack of traction with shoppers is exacerbated by the relatively high price points, which mean that consumers are all too happy to leave product on the rail if it’s not quite right.

Old Navy’s decline is more recent. While the brand has been the star of the show for many quarters, the past few collections have been dull and uninspiring.

“While Old Navy has been the star of the show for many quarters, the past few collections have been dull and uninspiring”

Neil Saunders, Conlumino

Stores are also looking more fragmented with no clear merchandise or brand story to entice shoppers.

Coupled with excess inventory, this has made for a less than pleasant shopping experience – something that has diluted the impact of the various flash sales and offers Old Navy has traditionally relied on for growth.

As problematic as sales are, there is no doubt that margins are equally troubled.

All Gap brands have resorted to heavy discounting in order to boost sales and, even so, the company still has excess stock.

The final profit position for the quarter is very poor, with net income down by a sharp 47% over the prior year.

All of this bodes badly. Gap is now a retailer without any star brands and with seemingly little vision to move itself forward.

Unless it takes radical action to overhaul its businesses, the outlook will only darken still further.

  • Neil Saunders is chief executive of Conlumino