Gap Searches for a New Creative Shop -- Again

Still No Agency of Record Relationship Expected for Flagship Brand

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NEW YORK (AdAge.com) -- Gap Inc. is out talking to creative agencies again as it hunts for new ad ideas for its flagship chain of Gap brand stores, which the retailer is expanding globally.

While it has an agency-of-record relationship for other brands, when it comes to the flagship store, the company has avoided those pairings in favor of hiring shops to handle shorter, seasonally-based campaigns.

"Gap is exploring a creative partner for our holiday 2010 campaign to join our roster of global advertising agencies," a spokeswoman told Ad Age. "It's part of our focus on ways to best engage with our target customer to help support our overarching goal of improving sales."

There's good reason for the goal: Gap's most recent sales data shows net sales of $1.05 billion for April, flat compared to 2009. Meanwhile, sales for April for stores opened at least a year decreased 3%, compared to a 4% decline in April 2009.

On a quarterly basis there has been some improvement, but that's comparable to the recession, which whacked retailers badly. For the quarter ended May 1, Gap sales grew 6% to $3.33 billion compared with $3.13 billion for the first quarter last year.

The 2009 holiday campaign for Gap stores, dubbed "Holiday Cheer Factory," was done by MDC Partners' Crispin Porter & Bogusky, which is the agency of record for Gap Inc.'s Old Navy. But Crispin's contract for Gap brand ended weeks into the new year and recent ads have been handled by New York-based Laird & Partners, Gap's onetime creative agency of record.

While its unclear how many agencies Gap is out talking to now, it's a safe bet that among them are some large shops with a global footprint, given the company's stated strategic priorities: to lift sales and grow internationally.

The company has Gap brand and Banana Republic stores in the U.K. but is embarking on a major European expansion this fall into nine other countries, including the opening of its first store in Milan, Italy. It's also opening Gap in China at year-end.

The creative review for the Gap brand coincides with an ongoing global media agency review Gap is conducting. Omnicom Group's PHD is the incumbent for U.S. media-planning and -buying duties. In other ad agency changes, the company quietly brought aboard Sausalito, Calif.-based indie shop Butler Shine Stern & Partners last month as agency of record for the PiperLime shoe brand.

Gap Inc. last year spent nearly $350 million on U.S. measured media alone, though more than half of it -- $207 million -- was devoted to marketing Old Navy. It spent about $95 million on the Gap brand, and the remainder on Banana Republic, PiperLime and Athleta.

Other initiatives by the company of late include the opening of an Athleta test-store in California and the completion of some 100 remodels of Old Navy stores around the country.

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