Banana Republic 2010 Annual Report Download - page 5

Simon Kneen, head of design, Banana Republic: Our products are designed in New York
and provide customers with the versatile, modern styles they expect. This pool of products
has become more exciting as our American brand meets our global business needs.
At times, the adjustments for different markets often help to strengthen North America.
For example, Japan has a big appetite for our leather outerwear. To meet that need, we cre-
ated eight or nine different leather styles – from a trench to a bomber. This global approach
allows us the latitude to push creative boundaries. It produces innovative, brand-right
styles that bring additional dimension and character to our North America line.
How does the company differentiate itself?
Glenn: My responsibility is to challenge our teams to be creative and to stand out in
the eyes of our customers, whether they are shopping in a store or online. Leaders must
also balance the drive for innovation with discipline, especially around decision making.
We have many examples of how we’ve achieved this, such as our online “universality”
platform that allows customers to shop all of our brands at once. In today’s competitive
environment, success comes when hundreds and hundreds of fresh ideas – both large
and small – are executed well each month.
Andi Owen, head of Gap Outlet: The Outlet team is constantly brainstorming new ways
of working, and I’m proud of our ability to be creative, nimble and quick on our feet. Working
closely with vendors, our small product team has the freedom to move quickly when we see
something resonate with customers. In fact, we can go from concept to design to order
within a matter of days. While I was leading Banana Republic Outlet last year, one of our
many brainstorms led to an idea called the “Real Deal.” The product and value proposition
was compelling and clear, and the campaign became a huge hit. Customers shopped
much more than the year before, driving our strong performance.
Michelle Chan, senior director at Gap brand: I was given some white space to create new
concept stores to showcase our 1969 Premium Jeans, which led to the 1969 “pop up”
store in Los Angeles. This became our laboratory for countless ideas – covering everything
from visual merchandising to store design to the fixtures that worked best. What we
learned was incorporated into other Gap stores around the world. Most stores have a 1969
presence that has some of the ideas from the LA stand-alone store, and we’re excited to
continue pushing for more brand-enhancing, unique ideas.
Can you share what led to such a strong financial position?
Glenn: Gap Inc. has a solid financial framework. Maintaining cost discipline allowed us
to invest in growth vehicles while still delivering on the bottom line. Going forward, we’re
determined to achieve our goal of growing top line revenue. It’s a top priority for the
management team and paramount to our success.
Sabrina Simmons, CFO: Our economic model remains strong, and we were disciplined in
meeting our financial commitments. Earnings per share for 2010 improved by 19 percent,
and we grew net sales by 3 percent. This year, while we invested more in the infrastructure
for growth, we still achieved the highest operating margin in a decade: 13.4 percent.
In August, we launched our first site
exclusively for Canadian shoppers.
A sleek, modern design greets customers at
the 1969 concept store in SoHo, New York.
Old Navy’s remodels give customers fun,
easy shopping experiences.
Photo: Zack Seckler