The Gap’s plans to use analytics and machine learning to attract younger consumers

New York – Arthur
Peck, CEO of The Gap, said that his company will have to battle for a
younger customer and get the best yield out of a promotional retail
environment.

Earlier this week, The Gap held an analyst day for Wall Street. The
company’s CEO, summed up the corporate strategy based on the application of
advanced analytics and machine learning models. Digitalising their store
assortment process, improve their approach to personalisation and apply
data strategies to inventory optimisation and marketing effectiveness.

The Gap is applying advanced analytics to modernise their inventory
management

Regarding their bid for a modernised approach to brick & mortar stores,
Peck recalled for analysts that the multi-brand retail group is “in the
process of rolling out a proprietary assortment and buy planning tool,
which runs all the way down to store level allocation. That has the API for
machine learning and machine decisions as it relates to store allocation.
So right product, right place at the right time.”

He explained that their main goal is to identify any potential synergy
across stores, so if there is excess of inventory in a given store, another
one can take advantage of it. “Right there, there is a yield opportunity.
And that is material. That’s just the right allocation, the right
replenishment and then also making sure it’s the right size, curves.”

Gap’s CEO prioritises customer experience personalisation

The Gap’s CEO advanced their plans to leverage cookies and other
credentials to offer their customers enjoy personalised web experiences:
“you’re going to experience a personalised site opportunity where we’re
presenting your landing page differently, we’re presenting our product
recommendations differently through our (inaudible) product engine, a
number of different things we’re doing there.”

The end game is clear to Peck: “When you personalise the web experience,
every needle moves in the right direction. Our revenue per visit goes up.
Our conversion goes up, etcetera.”

Image:Gap denim, The Gap Inc.