The Gap's McCadden exits the Net

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The gap is the latest retailer to make shifts in its online arena weeks before the start of what promises to be an explosive holiday online selling season.

Michael McCadden, exec VP-Gap Inc. Direct, stepped down from the unit responsible for online operations for The Gap, Gap Kids and babyGap. The unit, headed by Jeanne Jackson, also handles Banana Republic's catalog as well as its e-commerce site planned for an October or November launch. Old Navy will start a marketing site late this year, with sales beginning next year.

A Gap spokeswoman said Mr. McCadden decided to relocate from San Francisco to New York. "We are looking at ways he can continue to play a major contributing role in the company," she said.

At the same time, Jayne Greenberg, VP-advertising in charge of media, moved to VP-business development for Gap Inc. Direct, focusing on strategic partnerships.

Mr. McCadden declined to comment on the move. He joined The Gap in 1996 as exec VP-marketing and shepherded its ad budget to $419 million last year before shifting to the Direct unit.

SPINOFFS POSSIBLE

On Wall Street, there's been talk The Gap may spin off its Direct, Old Navy or Banana Republic units. The Gap spokeswoman said she was unaware of any such move.

Other retailers shuffling their online decks before the holiday selling season kicks off include Toys "R" Us, which changed management and Web developers, and Sears, Roebuck & Co., which chose Viant Corp., Chicago, for a fourth-quarter relaunch of its site. USWeb/CKS, San Francisco, had done some work on Sears' site earlier.

Evie Black Dykema, an analyst at Forrester Research, said The Gap has delivered a functional, well-regarded Web site.

But it has lagged competitors in percentage of sales coming from the Web. Wall Street analysts put Gap '98 online sales at less than $25 million, less than 0.5% of sales.

Ms. Dykema said competition is increasing. "The retailer who is there to greet the customers online will benefit and those who do it poorly will pay the price."

Copyright September 1999, Crain Communications Inc.

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