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At the end of his session, which Linda Bustos already covered very well, Gap.com CEO Toby Lenk had about 20 minutes left in his time slot and opened the floor up for questions. People were almost jumping out of their seats to get to the microphones first. Here were some of the most interesting components of the lively Q&A:
On an international plan: Lenk mentioned that Gap already has stores in many international markets and that the company was “actively evaluating when to support those markets with ecommerce,” he said. “Don’t be surprised if you start to see us do some things there.” He also mentioned that “the UK is a fantastic market and is growing like crazy.” Read: Gap hasn’t announced an international ecommerce plan yet, but you could hear about one soon.
On the phrase that the “web is a company’s biggest store:” Lenk seemed put-off by this common analogy because he said that thinking ”degrades the importance of the web.” In addition to using the internet as a sales channel, he said, it is also the best marketing program that a company has. And, unlike print and television advertising, it’s marketing that actually makes money, instead of costs money.
On cross-channel sales attribution: While the company does not reward store associates for online performance or online staff for store performance, the conversation is being had among executives.
On how to “break the rules” if you’re only in middle management: Lenk suggested that those in ecommerce who might not yet be the big decisionmakers “find an evangelist” within the company, like a CIO or CFO, that will help sell new ideas to company executives. However, he said, it’s nearly impossible to be innovative if upper management does not want to invest in new ideas. “If the top people don’t want to hear it, you may stall,” he said. “Start hoping for a new CEO.”
On the possibility of the website’s universitality (having all Gap’s websites under one roof) causing cannibalization among Gap brands: In today’s economy, Lenk acknowledged that some of Gap.com’s customers may want to “trade down” to Old Navy. However, he said, that’s no reason not to combine all brands into an easy format for customers to access. “Don’t get hung up on the idea of customers trading down within your brands,” he said. Besides, if the customer can’t find something at Gap.com, the company would much rather that customer visit another one of its brands than a competitor’s site.
Lenk also provided a more optimstic perspective on the “trading down” concept. “Customers are aspirational,” he said. “They really like to think about trading up.” In fact, Lenk said, since combining Gap.com, OldNavy.com, BananaRepublic.com and Piperlime.com, the biggest winners have been Banana Republic and Piper Lime: the brands with the highest price points.
On social media: Lenk acknowledged that the company has experimented in the social networking world. Saying that some in the company have “skepticism” while others have “hope,” Lenk admitted that he isn’t sure how powerful social media will be for Gap. But he did say that the company was learning and testing to understand the value of sites like Facebook.
On customer feedback: The company has not yet integrated customer feedback on its site. Unlike other companies that sell merchandise from many manufacturers, Gap’s merchandise is its own. Lenk said that selling executives on the idea of putting both positive and negative feedback on the site is “a harder sell because, emotionally, it’s a bit of a hurdle,” but he acknowledged that customer feedback is very important and that it could help the company “do what we do.”
On free shipping: Shop.org members have been talking about the value of free shipping for weeks, so it was no surprise when this question was raised by an audience member. When asked his perspective of free shipping, Lenk smiled, then remarked that talking about free shipping was “always a painful discussion.” He conceded that Gap falls in the middle of the pack on the free shipping debate, offering free shipping on occasion but relying primarily on its flat rate shipping, offering to ship any order from one or multiple Gap websites for a flat $7. He said that customer feedback on the flat shipping rate has been strong and that they’re willing to pay it.
On loyalty programs: An attendee asked if combining the brand’s websites also meant that loyalty programs were combined. In fact, Lenk said, the company integrated the Banana Republic credit card into all of its brands several years ago. Customers can use the card at any Gap website to pay for merchandise and earn and redeem points. he said that integrating the Banana Republic credit card into all of the brands was the company’s “first step in breaking the rules” and that the process was hard but worthwhile.
On technology: “If you’re going to be an ecommerce leader, you have to be willing to invest in technology,” Lenk said. “And you have to be willing to invest in it every year.”
