Yesterday was a day for honesty in the fashion industry. Not only did Under Armour’s CFO Chip Molloy (great name) admit that the fast-growing brand only sponsored the US Olymics team for the social media buzz it generated rather than for a sales boost, but Gap’s CEO admitted that there are no compelling trends to help lift the gloom in tough times.So first, Under Armour. At the Goldman Sachs retail conference, the Wall Street Journal reported that Chip Molloy (can’t resist repeating the full name) said: ”You’re not really sure which part’s working, but the posts we saw, emails, things you saw all over the internet around UA helped create more brand heat.”
That was in response to a question over whether its sponsorship of the US team helped sell more products. Molloy said that the company doesn’t even sell some products with which the team sponsorship would have associated it (such as leotards).
So it’s brand heat that counts rather than expecting consumers to rush out and buy, say, a pair of sneakers just because a US athlete has just won a race. Which is lucky given that in 2014 at the Winter Olympics, the US speedskaters blamed Under Armour’s suits for them doing so badly. That was a big topic on social media at the time but it didn’t seem to hold the brand back. Maybe it’s just the buzz that counts, not the positive buzz.
Now to Gap. At the same conference, CEO Art Peck (another great name) made this statement: “There are no compelling trends driving the business.”
Yes, I know there are lots of trends around and Gap’s website at the moment currently opens with a mixed bag of the “10 most needed” items. But none of them are ‘compelling’ trends, those must-have items that it seems everyone wants. And while summer’s hot pick (the off-the-shoulder top) probably still has some mileage in it for the Christmas party season, I doubt whether it’s going to be big news for autumn.
Peck reminisced about 2012’s coloured skinny jeans trend that was a big sales driver but said there’s nothing at the moment. Zilch. Zero.
He also said we consumers are no longer feeling the need to replenish our closets (no surprise given how slow the underlying trend cycle has become) and when we do, we want low prices.
So, don’t expect sales surges from gap any time soon.