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Gap CEO Art Peck: Big Data has brought us significant advantages over competitors
As retailers shift their focus to costume manufacturer in the most effective way, Big Data is becoming a key tool for companies like The Gap, Inc., President and CEO Art Peck, telling CNBC.
Peck said in an interview with “Crazy Money” moderator Jim Cramer on Wednesday: “We are really building backend big data analytics for a few years now. Data is a huge asset for us.” “I was surprised The fact is that more people in our field are not talking about it.”
Peck said that the old navy, Gap of the banana Republic and parents of Athleta and other parent companies easily beat earnings expectations in March, thanks in part to the strength of their brand.
As of Wednesday’s close, the Gap stock price has fallen more than 10% so far this year, but it has risen more than 24% in the past 12 months.
The retail giant conducts 2 billion customer visits between its websites and stores each year, and also uses the data it collects to use it in the consumer market, which leads to improvements.
“We know a lot about our customers. We can see their lifetime value. We know who our most valuable customers are,” Parker told Cramer. “In terms of structure, because we have multiple brands and multiple channels, we have many things that other clothing companies do not have.”
Peck said using consumer data to pay dividends in a variety of ways. It helps Gap to get the best return directly in the most effective way; it gives the company insight into the needs of consumers in the company; it helps determine where the value is.
“If you look at the difference between an occasionally involved customer and a customer who is really deeply involved in the cross-channel channels of our brand, then the value of this customer is at least 10 times that of the customer,” said the CEO.
Peck continued: Today, Gap’s marketing spending is heavily skewed toward advertising on social media rather than traditional media.
In an interview with Cramer, he said that advertisements on platforms such as Facebook and Instagram can allow retailers to target customers more specifically, and provide Peck with “outstanding line of sight returns”.
“This is very effective for us,” said the chief executive. “If I get 6 times or 8 times the return on advertising spending, I might say that I want to spend 3 times the return, and I still get an incremental return on the dollar. It’s hard to do that for traditional media.”
However, Gap and its basic business did not lose more traditional retail business. The company’s sportswear brand Athletel has grown from online sales to 140.
“Most of the retail is from entities and costume manufacturer online, Athleta is from the web and directory, and it is being materialized, and we are very focused on making sure we are building tomorrow’s retailers,” Peck said.
Peck said that Athleta’s business is now only half of the online, semi-entity, and plans to expand physical storefronts at a “responsible pace.” But for Gap and Athletea, the focus remains on consumers who want to see from top brands.
Peck pointed out that Athleta has recently become a company B, which is a kind of certification similar to “fair trade”, which recognizes a set of strict social and environmental standards.
“This is a question of value. Our customers are very responsive and the participation of the brand is amazing. This is what consumers are looking for today,” Peck told Cramer. “I don’t care if this is a millennium or a 70-year-old woman. She thinks this is a brand. She can relate to the brand from a perspective of values. This is a very powerful equation.”