"Kan Ye" Drive To Save Gap

In June 26th, the fast fashion brand Gap and Kanye West announced a 10 year deep commercial cooperation project. Kanye West will be the creative person in the Gap brand to launch a new "YEEZY Gap product line". This is not a simple joint name. The product line will be developed by YEEZY design studio, which is under the control of Kanye West, and will be the design director of Mowalola Ogunlesi, a Nigeria based British designer who is now in a strong momentum. The product positioning is to present the modern high-end men's and women's wear and children's clothing basic price at the price of the people, and is expected to be listed on the Gap entity store and the official website in the first half of 2021. "We are very happy to welcome the creative and visionary Kanye return to the Gap family, and to define the new retail partnership with us on the basis of the success of Yeezy's brand aesthetics," Mark Breitbard, Gap brand's global head, issued a statement. The ideal is very plentiful. But in the depressed retail environment before and after the epidemic, will the Yeezy Gap join hands with the consumers to pay the bill?

"Kanye West" has been playing like a duck to water in all kinds of crossover. Figure Green

"Kan Ye": a dream of civilian design

Kanye West, which is known as "kan Ye" by fans, has been playing like a duck to water among all kinds of crossover. There is great momentum that "No Rap singer who is not a music producer is a good fashion designer and businessman". Before 2014, most of the audience's impression on him was only on the husband of a singer or a reality show star, Kim Kardashian. But in fact, though not a professional, Kanye has always had a unique view of fashion.

It is reported that when he first released his music in 2002, he once said he wanted to be the best rapper in the style. In 2005, Kanye West announced that it was the first to launch a clothing product series called Pastelle, but the product line was finally ignored, and it was not officially released to the public. In 2011, he first showed his design to the stage of Paris fashion week to show to the audience. In 2012, he began working with Nike, then moved to Adidas in 2014 and founded a fashion brand called Yeezy. In 2015, he brought the series to the fashion week of New York, and this led to a worldwide trend of "coconut shoes". Through celebrity effect and hunger marketing, the Yeezy team successfully created several myths of explosive money, and the series of sneakers launched were mostly sold out, and Kanye finally established its position in the fashion industry. According to Bloomberg quoted the Bank of America statistics, in 2019 the Yeezy brand valuation has reached 3 billion U.S. dollars.

But for Kanye West, making a net red sneaker brand can't satisfy all his fashion design ambitions. Christina Binkley wrote in an evaluation of Kanye West in the Wall Street journal, saying: "he didn't get much honor from fashion critics, but it had an impact on people's clothing and changed the way people dress more and more." Compared with Yeezy's footwear series, high-end clothing design has always been weak. Negative news has been produced in the first few seasons, and Season 8, which was just shown on fashion week in Paris in March, is also very limited. In his early years, he once said that Yeezy should be built as "the largest clothing company in the history of mankind". In addition, he has repeatedly mentioned publicly that he had worked in a Gap in Chicago when he was 15 years old, so he had a deep affection for Gap brand. When he was interviewed by Style.com in 2015, he even spoke frankly that he wanted to be the creative director of Gap and "Jobs of Gap company". Since 2018, Kanye has repeatedly expressed its desire for the popularity of Yeezy brand in its cooperation with Adidas, which is considered to be a strategic change from gaining attention to scale income. But in fact, Kanye does not want its products to be like luxury goods and win by "scarcity", "exclusiveness", "high price" and hunger marketing, he told the media. What I want to do is the mass production of high quality products like McDonald's or Apple Corp. And the fast fashion price is close to the people and the audience is wide. It seems that Kanye chose to enter Gap to "dream".

Gap: a move to save the nation from extinction

Compared with Kanye's "dream come true", Gap's bet on the ten year cooperative bet is much larger. The ten year agreement between Kanye and Gap will take effect immediately from this month, but it can be renewed after five years, according to New York Times. Kanye will have complete creative control and full ownership of Yeezy brand before the five year renewal period arrives, while Gap will manufacture and distribute garments worldwide, and will pay Kanye based on actual sales. In 2019, Gap's total revenue in the world was US $4 billion 600 million. In this partnership, Gap hopes that the new Yeezy Gap series can achieve annual sales target of US $1 billion per year. We also see Gap's high expectations for this cooperation. As an incentive, Gap also said it would provide royalties and potential shares for Yeezy in return based on actual sales.

Some analysts pointed out that the Gap's next heavy book is not only looking at the "kan Ye effect", but also hoping to cooperate with Yeezy to get creative support, inject vitality into the brand, and re promote the growth of Gap's performance. For a long time, Gap has often been criticized for its lack of creativity in design, and too many stores, which are hard to arouse consumer interest. The company's financial situation has not been ideal in recent years. In the early 2020 quarter of June, the first quarter of the year (February 1, 2020 to May 2nd) released by the gaopp group reported that sales fell by 43.1% to 2 billion 107 million US dollars this year. Sales of the three main brands, Old Navy, Banana Republic and Gap, respectively, fell by 42%, 47% and 50% respectively. Under the impact of the epidemic, the sales of all stores under the brand of GAPP were all down by more than 50%. Although online sales increased by a different proportion, it was still difficult to recover the overall decline.

It is gratifying to note that when the news of Yeezy Gap jointly broke out, Gap's share price rose 42% at a time. As of the 26 day closing, Gap recorded a 18.8% gain, the company's market value soared to $4 billion 500 million, an increase of $700 million. As far as market reaction is concerned, it is also enough to show that investors are more optimistic about this move under Gap.

Good chess? Dangerous chess?

Most of the fashion industry is also optimistic about this new series. "People haven't talked about Gap like this for a long time." Neil Saunders, managing director of global retail data consulting, told BBC: "Gap is like a hot topic from street to street." Mickey Alam Kahn, editor of the luxuries daily, agrees with him: "Yeezy is like the golden signboard that brings the street trend to Gap. The most exciting thing about Yeezy Gap is that it has finally rescued Gap from the design direction which is neither academic nor hip-hop, and even has no sense of movement. "Oliver needs young customers because they love street clothes and love fashion trends," said Oliver Chen, a senior stock analyst at Cowen retail and luxury goods business. Although Yeezy Gap is under the banner of "half luxury", it will become a popular product under the urge of strong market demand. In addition, Oliver also pointed out that considering the cooperation relationship between Yeezy and Adidas has developed into a huge business of $1 billion 500 million, Yeezy Gap series is expected to bring about $1 billion in annual revenue.

But the voice of doubt also exists. NDP group analyst Matt Powell issued a commentary shortly after the announcement of the news: "when everyone can get it, no one wants it." Yeezy Gap, which breaks away from hunger marketing, is bound to test the quality and creativity of products. Can Yeezy still retain its attractiveness? In addition, in the post epidemic era, Gap, which owns more than 1000 stores, is in urgent need of reintegration. However, most shopping centers of Gap entities may still face the possibility of a weaker passenger flow for a relatively long time. Can the new series continue the best-selling myth? Until the first batch of Yeezy Gap products first appeared in 2021, there are still many variables to be foreseen.