Gap Goes Outside Agency of Record for Creative Ideas

Incumbent Laird & Partners Invited to Participate in Pitch for Holiday Campaign

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NEW YORK ( -- Gap Inc. is talking to agencies about creative ideas for its flagship brand, reaching beyond incumbent Laird & Partners for the first time in seven years.

Independent Laird & Partners, New York, has been Gap's creative agency of record since 2002, when it was tapped to handle print and TV work amid a 21-month decline in same-store sales.

A Gap spokeswoman confirmed the search. "Gap is exploring new partners, specifically for our holiday 2009 campaign," she said. "We've narrowed the pool down to a handful of agencies and have not made any decisions yet."

Executives close to the matter said the retailer has made a cut to the three shops. The spokeswoman declined to identify agencies involved in the process but said Laird & Partners had been invited to take part. She stressed that the pitch is not an "agency-of-record review."

Falling sales
San Francisco-based Gap Inc. has seen sales tank at its stores in the past few years, and the recession -- which has battered the retail sector overall -- hasn't helped. In 2008, the company's sales fell to $14.5 billion from $15.8 billion in 2007 and have been steadily declining from a five-year high of $16.3 billion.

Gap North America and Gap Inc. online account for about a third of the company's overall sales, or $5.2 billion.

Gap Inc. slashed operating expenses last year, including $41 million in marketing expenses, primarily for the Old Navy and Gap brands, according to company filings. Still, its advertising outlay is no drop in the bucket. Gap Inc. -- which is the parent of Gap, Banana Republic, Old Navy, Piperlime and Athleta -- spent a total of $435 million on advertising in fiscal 2008, compared with $476 million in 2007 and $573 million in 2006.

If the holiday 2009 assignment were to shift to another agency, it would come as a blow to longtime shop Laird & Partners. Trey Laird, Laird & Partners' CEO and chief creative, declined to comment.

Gap Inc. has long favored small, fashion-oriented boutique shops for its marketing but recently has hired big-name ad shops to handle creative campaigns.

The move to get new marketing ideas on the Gap brand comes after the marketer shifted lead creative duties for Old Navy to Crispin Porter & Bogusky from indie shop Chandelier Creative, New York.

Signs of improvement
Gap Inc. CEO Glenn Murphy said during a company earnings call last month that Gap is beginning to see some signs of improvement, and accordingly, the company's investment behind the brand is picking up.

The brand is planning to relaunch denim in August with a new campaign. August also marks Gap's 40th anniversary. Still, Mr. Murphy was careful to temper expectations around the campaign, lest anyone expect a glitzy affair reminiscent of Gap's past. The campaign will not include TV, he said, adding people shouldn't expect an expensive campaign along the lines of Old Navy's recent 'Supermodelquins' push from Crispin that broke in February.

"There is going to be a campaign, but I would not say it's going to be breakthrough," he said. "It's not deep, it's not rich, but I think it's good enough for the brand right now, and then we'll take a look at the back half of the year beyond that and whether there is reason to make further investment in Gap brand."

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