môn học chuyển đổi số và trí tuệ nhân tạo gap inc

Summarize the objective of your proposal - Use predictive analysis to sell existing products - Use predictive analysis to sell new products - Predicting consumer interests - Looking forw

DAI HOC QUOC GIA THÀNH PHÓ HỎ CHÍ MINH TRƯỜNG ĐẠI HỌC KINH TẾ - LUẬT KHOA KINH TẾ ĐÓI NGOẠI

MÔN HỌC CHUYEN DOI SO VA TRi TUE NHAN TAO

Giang vién: Nguyén Thé Dai Nghia

Mã lớp hoc phần: 215MI5202

Ca học: Sáng thứ 3

Nhóm sinh viên thực hiện:

1 Duong Minh Khué K214021480

2 Doan Thu Hoai K214021478

4 Võ Thị Thương K214020164

5 Nguyên Phương Anh K214011421

TABLE OF CONTENTS

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A OBJECTIVE

1 Summarize the objective of your proposal

- Use predictive analysis to sell existing products

- Use predictive analysis to sell new products

- Predicting consumer interests

- Looking forward to the future

2 Replace the position of creative director for each of the firm's fashion brands with a more collective creative ecosystem

Peck was betting that market intelligence fueled by Big Data could outperform a creative director at predicting the future fashion tastes of consumers Could data-mining replace the artistic vision of a creative director? Was this the night approach to fashion development for all three of Gap’s brands? Selling Gap’s products on Amazon could open

up a whole new data stream to Peck and his managers, providing insight into the shopping habits of existing customers when they weren’t shopping on the company’s own digital platforms or in their stores, and providing access to new customers not currently attracted by the company’s distribution efforts Should he allow Amazon to sell his brands?

3 Address consumers' shift to omnichannel shopping, focusing on dissolving the wall between the physical and digital channels

3 Deliver a better customer experience

B KEY ISSUES TO TACKLE

I List of issues

1 Slow growth in core markets

Gap Inc competed in the $3 trillion global apparel industry, which accounted for 2%

of the world’s gross domestic product (GDP) The U.S and Canadian markets accounted for over $340 billion and were expected to grow annually by 2% through 2025 These two markets accounted for 84% of Gap’s sales

Millennials were spending less on apparel Speaking to investors at a retail conference, Peck claimed that “there are no compelling [fashion] trends driving the business” and lamented that there had been a change in consumers’ buying habits such that there was a lack of need to replenish their closets

2 Competition

The mid-tier apparel landscape was fragmented and overcrowded

3 Rise of e-commerce

Consumers were shifting their purchasing from brick-and-mortar stores to online channels In the U.S., 19% of apparel was sold through online channels in 2016, and in

2015 clothing became the best-selling online sales category, driven by Amazon’s increasing strength in apparel Amazon, the world’s largest multi-line, multi-brand Internet-based retailer, was on track to become the largest seller of apparel in the U.S by the end of 2017 As online sales grew, brands did not need the same number of storefronts Empty stores lined the American shopping malls, as both specialty retailers and department stores simultaneously faced pressure to close locations Gap had over 3,000 physical stores By 2017, Gap Inc.’s online sales exceeded $2.5 billion

4 Rise of Fast Fashion

New competitors, such as H&M and Zara, compressed supply chains, delivering low- priced looks knocked off from luxury fashion runways within weeks of their unveilings With an average product cycle time of 10 months, Gap lagged competitors such as Zara which could deliver products to stores within four weeks due to their consumer- responsive and decentralized buying process, which allowed individual stores to order small batches of product, wait to see how consumers responded to it, and then airlift additional products to backfill the store’s inventory within days The speed and pace of the fashion cycle was dizzying, with new styles appearing in stores on a weekly basis ina constantly renewing fashion cycle

5 Heavy and frequent discounting

Clothing was increasingly commoditized as consumers viewed the lower-quality fast fashion offerings as disposable, yielding a need for low prices and heavy discounting Retail analysts were concerned about an overabundance of price promotion at Gap, where 40% discounts were common

6 Gap’s size and ubiquity were transforming from asset to liability

Consumers looking to forge a unique identity were moving away from Gap’s classic offerings

II Some Solutions:

1 Replace creative directors with Big Data obtained from Google Analytics, Google Trends, social media, the company's own sales and customer databases to inform the

next season's assortment

2 Develop an augmented reality app

- Use data-driven decision making: personalize shopping experiences based on browsing and purchase history

- Develop email programs to provide relevant, personalized messages to consumers

3 Messaging based on consumer's searching, or deliver another landing page based on browsing history or IP address

4, Understand why consumers were not buying as much from Gap's physical stores

= develop Gap's digital and mobile e-commerce platforms to drive customer

engagement

Il

Option 1: Product strategy: Big Data in, creator directors out

C EVALUATE OPTIONS

Criterion

The solution provides the highest efficiency for the Gap

Options

Advantage:

Make the most of the resources and collaboration to form the most optimal idea

Using a collaborative model, decentralized, data - driven

Avoid conflicts in synchronization between employees and leaders

Control through hard data saves time, b6 and professionalism

Weakness:

The lack of creative director leads to a clear fashion orientation, as a ship without captain

There' s a lot of conflict in making synchronous decisions between a group of partners without a guide

The big problem is whether Big Data can replace the director's artistic vision Option 2: Big Data and analysis of marketing

Advantage:

Use the available data sources to analyze and anticipate the appropriate marketing needs

Analysis of the prediction to marketing existing products or create new products that meet tastes

Catching consumers’ tastes will have a business strategy consistent with market demand

In short term, new tastes are usually based on existing tastes, predictable

Weakness:

Customer tastes are difficult to predict because consumers are notoriously poor

to predict their future behaviors

Consumer interests are built rather than revealed, subject to marketer manipulation, unstable over time

The taste of each person is not the same

3 Option 3: Product 3.0

Advantages:

- Using Big Data as the original source of innovation for fashion trends, combine the’ clear brand vision with a common model!

- Based on google analytics can be defined soon

- Significantly improved the ability to meet the supply chain and inventory

management

Weakness:

4 Option 4: Change the distribution model

Advantages:

- Access to digital customers

- Amazon can provide a customer access gap even if they don' t shop on the company’ s platform

- The distribution of products through two alternatives is to use amazon as a transport channel or use amazon as a distributor

Weakness:

- Can't guarantee the situation around the customer

- The choice between giving up control to use the amazon giant

D RECOMMENDATIONS

I Our recommendations

1 Our recommendation solution

Replace creative directors with Big Data obtained from Google Analytics, Google Trends, social media, the company's own sales and customer databases to inform the next

season's assortment

2 Our recommendation solves the issues

Gap' s leadership needs to appreciate that customer' s fashion requirements are built in social ways by collective behavior and taste in tastes and interests As a result, designers

do not consider the impact of social effects on consumers’ tastes that have weakened the goal of changing gap products in conformity with the changing market demand Another notable issue involves the need for the company' s essential need for large data implementation to promote product mnovation Market - based market research strategies have previously backfired Accordingly, the company can apply new analytical methods to assess customer behavior on the garment market The use of large data to assess the trend in garment and customer change is important because it affects the success of gap in its operations Therefore, we believe that peck’ s decision to eliminate the creative director while using large data analysis to promote the development of the creative costume to match the customer’ s interests in different segments is appropriate

IL Five Forces

The threat ofBargaining power Bargaining power Threat of Competitive New Entrants of the buyer of supplier Substitute Rivalry

Low Moderate to high Moderate to high High High

Numerous Numerous Few suppliers and Low Dominating players dominating the quality of differentiation players

players material among the

Saturated products Products are market Identical products The manufacturer really identical

High rivalry Zero switching cost is wholly Readily Zero switching among the depended upon availability of cost of the

competitors Many substitutes the supplier for the substitute buyer

Strong brand image, "9W material ahi

Strong brand ?'TONS Fan oo hich is plastic 20 switching High

identity high quality, skin cost of the advertisement

fnendly, No substitute buyer and

environmentally promotional friendly Zero switching activities

cost

Tit SWOT Analysis

1 Strength

- Gap is one of the people who make special retail forms, in which a retailer focuses

on a more specific product category rather than carrying many of its own products and products It is still the biggest example of this category, with 135, 000 employees and 3, 659 locations owned by the company and franchise at 50 countries, accounting for 36 7 million square feet of goods, creating global revenue

- Enjoy a good reputation by advertising through mass media

- Gap Inc management of the brand year: gap, banana republic, old navy, athleta and intermix, and used to be the U.S style of simplicity All these brands are common in different demographic segments it's the way the retail fashion brand

is headed for multi - diversity customer segments

- Enough knowledge and experience to adapt to new fashion trends

- Providing quality products for many different customers, closely observed gaps in market trends are changing and customers’ demand The retail company provides products that match the trend of the needs It gives the company a unique competitive advantage compared to other brands

- Have strong financial figures

- Along - term multi - brand portfolio

2 Weakness

- Putting the burden on these brands over the season to another is an individual being inspired

Clothing and retail accessories are a very competitive industry The gap of the gap has not made a difference compared to other competitors It reduced the market share to a large level

There is a limited share with high - brand conversion

Revenue and declining profits are a major weakness that the company can’ t handle Still use their assets and not profit on assets and equity

Gap is lagging compared to the opponent on the effective usage of online sales Not to grasp the needs of customers

Opportunity

The core capacity of the organization could be a success in similar product The development of the market will reduce the advantage of competitors and facilitate the Gap Inc., to increase competition compared to other competitors New trends in consumers' behavior can open new markets for the gap, inc., which provides a great opportunity for organizations to build new revenue lines and diversify into new product categories

This investment has opened new sales channels for the gap, inc In the next few years, the company can take advantage of this opportunity by understanding its customers more and serving their needs using large data analysis

Expanding mternational markets focused on Asia

Use online retail trends and improve their site to mtroduce products to customers

4 Threatening

Digital brands are increasingly filling gaps in fashion retail areas and forms digital revolutions for rival brands such as gap and other competitors like zara or mango Bitter competition - stable profitability has increased the number of companies in the industry, which has caused pressure to decline not only for profits but for sales

New technologies are developed by competitors or market breakers may be a serious threat to the future and long - term industry

Provide products with high levels of competition

Risk associated with global supply and production

IV Financial analysis

1 Cost (fixed, variable)

10