With its sights set on a sales turnaround in the second half of 2006,
plans to start an online footwear business in time for the holiday shopping season.
The specialty retailer announced Monday that its e-commerce division, Gap Inc. Direct, will sell shoes for women, men and children, with an assortment of brands ranging from designer to casual offerings. The company said that agreements with "dozens of leading footwear brands" have been signed, but didn't provide further details.
"Almost two-thirds of our online customers surveyed last year said that they would buy shoes online from Gap Inc.," Gap said in a statement. "Gap.com, OldNavy.com and BananaRepublic.com are all consistently among the top 10 specialty apparel sites in terms of traffic, so we believe we already have an active and loyal customer base for online footwear."
The retailer, citing data from Forrester Research, said the online footwear market is growing nearly 15% annually and will become a $5.5 billion market by 2010. Gap said its own sizeable online customer base already buys shoes online.
Meanwhile, Gap has been bleeding market share to competitors, and has not posted a gain in monthly same-store sales since November 2004. Its declines have been spread across all its brands, and last week it posted a 16%
decline in first-quarter earnings.
On its earnings conference call, Gap executives told analysts that it expects same-store sales to turn positive in the back half of this year.
"During the first quarter, we made progress in each of our brands to improve the product and store experience," said Gap in a statement. "We remain confident in the strategies underway to turn around our business performance and look forward to seeing the progress reflected in our financial results in the second half of the year."
Shares of Gap were recently up 18 cents, or 0.9%, to $18.66.