Just two months ago, the first item in rapper Kanye West’s long-awaited YEEZY Gap line sold out hours before its launch, proving that cross-brand collaborations are something most consumers celebrate as the blue nylon padded jacket. brilliant with a cost of 200 dollars (3 thousand 953 Mexican pesos today) He flew Of the stores.
Since then, the brand has kept up the hype on her, launching the same Kanye padded coat in mid-July, but this time in black. However, no other item release dates have been shared.
It is important to say that the alliance between Gap and West was announced a year ago, and generating various questions and expectations of this movement. So far, Gap CEO Sonia Syngal has not offered exact information on exactly when the entire line would come out, how much it would cost and what the pieces would look like, which could be hoodies, basic garments, T-shirts and joggers.
Gap in crisis
Although the strategy can work for both brands, without a doubt the biggest beneficiary is the retail company, which suffered large losses in the face of the Covid-19 health crisis such as the loss of a billion dollars in early June 2020 thanks to at the closing of the stores to which it was forced, rethinking the reality of the market.
This partnership is a 10-year deal on a formula similar to West’s with Adidas, and Yeezy is expected to receive royalties and possibly stock based on how much it sells. Gap has not disclosed any other financial terms of the deal.
However, when the news broke on June 26, 2020, Gap shares rose 42 percent, as the collaboration could be the injection to boost the mall brand again.
Bad decision from West?
For retail expert Mickey Drexler, who was CEO of Gap in the late 1980s and early 1990s, the rapper’s decision would not have been the best and he even made it known before the deal was closed.
“I probably shouldn’t say this, but I told him he shouldn’t do the deal because, in my opinion, it doesn’t make any sense,” said Drexler, now CEO of the specialty clothing retailer. Alex Mill, to Yahoo Finance Live.
“I still have a lot of friends at Gap, but it doesn’t work for someone like Kanye. He is not a corporate person and Gap is a large corporation. So, I know the jacket is sold out. They made $ 7 million on the jacket overnight. He’s a smart guy, but he shouldn’t have. And I don’t think they should have done it either ”,
The numbers
Although we are not aware of the financial agreement, YEEZY is West’s footwear and apparel business in collaboration with Adidas, and now with Gap, which has been valued between 3.2 billion to 4.7 billion by UBS, according to internal documents compiled by the bank. By itself, the union with Gap could be worth up to 970 million of that total.
The collection is expected to be filled with modern designs that elevate the look of men’s, women’s and children’s staples at an affordable price in order to build momentum for the line and attract new or old customers to Gap stores.
The retailer is currently in the process of retiring all of its underperforming branches within shopping centers in order to drive more profitable growth going forward. In Gap’s fiscal first quarter alone, sales exceeded pre-pandemic levels, thanks to the strength of Old Navy and Athleta.
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