Gap Appoints H&M Veteran Rebekka Bay As Head Of Global Design For Gap Brand

Continuing its spate of hiring top-notch executives, Gap Inc. (NYSE:GPS) recently named Rebekka Bay as Creative Director and Executive Vice President for Gap Global Design, effective October 1. ^[1] Bay, who developed and launched the COS brand at the Swedish fast-fashion retailer H&M, will be responsible for products sold online and in the nearly 1,600 stores in 42 countries in which Gap operates.

While the appointment was long awaited after Patrick Robinson’s exit in May 2011, the choice of H&M veteran Rebekka Bay as the new global design head signifies the emphasis Gap is giving on capturing current fashion trends. Gap competes with other specialty retailers like Aeropostale (NYSE:ARO),  American Eagle (NYSE:AEO), Abercrombie & Fitch (NYSE:ANF) and Urban Outfitters (NYSE:URBN).

See our complete analysis for Gap

The inability to capture latest fashion trends in its merchandise was a major negative factor for Gap in 2011. However, in 2012, the company has focused the most on improving its product mix. The company hired Tracy Gardner and Jill Stanton as creative advisers for Gap and Old Navy earlier this year and recently appointed Narciso Rodriguez as an adviser for Banana Republic, which shows that Gap is determined to not lag behind in capturing the latest fashion trends. These efforts have also paid off during the past two quarters. While major competitors such as Aeropostale and Abercrombie continue to suffer from merchandise issues, Gap’s comps in all of its business channels have improved immensely, indicating a slow but steady turnaround for the San Francisco based apparel retailer in 2012.

Rebekka Bay comes to Gap with a significant leadership experience in H&M, an apparel retailer known for its fast fashion retailing i.e. bringing the designs from catwalks to the store shelves in the shortest possible time. With the success of COS brand of H&M behind her, we believe the appointment of Bay as design head can significantly improve Gap’s ability to remain in sync with the latest trends. Combine this with the expertise of current adviser Tracy Gardner, and the Gap brand easily has one of the strongest creative leads at its design helm.

Trefis maintains a $39.60 price for Gap’s stock, which is nearly 10% ahead of the current market price.

Understand How a Company’s Products Impact its Stock Price at Trefis

1. Gap appoints Rebekka Bay as Head of Global Design for Gap Brand, Source: Gap’s IR [↩]