January 29, 2015 / 11:49 PM / 3 years ago

Gap cuts design chief job as sales slowdown continues

2 Min Read

The sign outside a Gap store is seen in Broomfield, Colorado February 27, 2014.Rick Wilking

CHICAGO (Reuters) - Gap Inc (GPS.N) said on Thursday it has eliminated the role of creative director Rebekka Bay, the latest in a slew of changes in strategy as the apparel retailer attempts to revive sagging sales.

Last week, the company announced plans to shut down its Piperlime brand, which sold designer shoes and clothing, by the end of April. Piperlime generated less than $100 million in annual sales.

The company, whose namesake brand saw a 4 percent drop in store sales in November and a 5 percent drop in December, said Bay will leave the company immediately. Instead of a new creative director, Scott Key will become senior vice-president, customer experience, overseeing a newly combined e-commerce and marketing business. Key is currently a senior executive with Gap.

The changes were announced after the company's "Dress Normal" campaign failed to resonate with consumers last fall and analysts panned the company's designs as unexciting.

Despite being one of the more popular apparel brands in the United States, the retail chain's buyers have eluded its relatively expensive Gap and Banana Republic brands, for fast fashion brands like Zara, Hennes & Mauritz AB H&M (HMb.ST) and Forever 21.

Gap has nearly tripled its international store numbers in the last nine years while its U.S. core store count has declined around 7 percent, analysts say.

Analysts said the changes will bring a much needed fresh perspective to the brand and help re-engage customer demand.

"This announcement is further evidence of the management's commitment to right the fashion and marketing problems of the Gap brand and that they will exercise little patience in the process," Morningstar analyst Bridget Weishaar said.

In October last year, the company said it would replace chief executive Glenn Murphy, who ran the company for seven years. Gap's new Chief Executive Art Peck starts on Feb. 1.

Reporting by Nandita Bose; editing by Andrew Hay

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