Gap Inc. taps Mattel's Richard Dickson as new president and CEO

By

Roxanne Robinson

Published
Jul 27, 2023

Talk about leaving on a high note. As the world is transfixed with Barbie-movie mania, the CEO responsible for the fashion doll's renewed popularity is stepping down to take on another U.S. institution, Gap Inc.

Richard Dickson, Mattel's president, and chief operating officer since 2014, has been appointed the Gap's president and chief executive officer, effective August 22. He has served Gap —whose portfolio includes Old Navy, Gap, Banana Republic, and Athleta—on its board of directors since November 2022.

"Richard has invaluable expertise in areas critical to the work Gap Inc. is doing to strengthen the company for the long term. And we are thrilled to have his visionary leadership as the company redefines the future potential of Gap Inc. and its renowned American fashion brands," said lead independent director Mayo Shattuck III, in a statement.

Dickson was the lead architect in the global corporate transformation that has breathed new life into Mattel's iconic brands, including Barbie, Hot Wheels, and Fisher-Price, leading to the company's growth and placing it back at the forefront of the toy industry. Under Dickson's leadership, the toy company launched the Mattel Playbook, a brand-building approach key to Mattel's growth of its power brands and transformation.

Dickson takes over for Bobby Martin, who filled in since Gap Inc.’s previous CEO Sonia Syngal’s departure in July 2022 and will remain its  chair of the board.

"Gap Inc. is a portfolio of iconic brands, known for having defined American style with bold thinking and making quality fashion accessible to millions. But it's the work ahead that excites me most - the chance to work hand-in-hand with the teams to evolve Gap Inc. for a new era," said Dickosn. He continued, "Under Bobby's [Martin] leadership, the team has begun to truly reset the company for long-term success, establishing a new foundation that I'm eager to build on."

Shattuck noted Martin's time resulted in simplifying the company's operating model, increasing the speed and quality of decision-making, and restoring its creative muscle.

What's ahead varies from brand to brand. One of the most recent transformations is the rebound of Banana Republic, whose sensible offerings were office wear staples in the mid-moderate priced range. The company has recently, at times to some eyebrow-raising, returned to its safari-themed roots and steered towards a classic continental travel look, bolstered by a more refined design and fit and using fabrics such as silk, cashmere, and linen, dubbed affordable luxury.

Potential Colonial-era missteps aside, the brand has renewed consumer interest under the leadership of President and CEO Sandra Stangl, whose background includes tenure at Pottery Barn and Restoration. Stangl's strategy, according to a source, is to reduce the number of SKUs, raise prices and reduce discount sales to elevate the brand. Affectionately nicknamed Banana, it has become the first Gap, Inc. brand to launch home goods.

Interestingly Banana Republic's recent ascent parallels one of its closest competitors J. Crew which has also regained some of its market share, presumably by returning it to its Jenna Lyons-led design glory days by tapping Olympia Gayot, who worked as the lead womenswear designer there from 2010 to 2017.

Old Navy was once so strong that Gap Inc. considered launching it as a standalone company during the Syngal tenure as Old Navy CEO before she took the top job at Gap, Inc. in 2020.

Old Navy launched in 1994, focusing on quality, on-trend, budget-friendly, casual family styles. It's mostly escaped the fast-fashion persecution of other competitor brands such as H&M or Shein and recently introduced a one-year durability guarantee on back-to-school clothing.

Old Navy's 2022 fourth-quarter sales fell 6%, in line with Gap Inc.'s total sales down 6% from the previous year.

Athleta, the moderately-priced workout, wellness, and casual lifestyle clothing line for women and girls—aimed at luring in the Lululemon customer looking for a better price-point—was notoriously the quiet fourth 'child' in the Gap Inc. stable until the pandemic when the waning athleisure trend got an unexpected boon thanks to the work-from-home look.

With net sales of $360 million, Athleta was up 4% in 2022 compared to last year's first-quarter fiscal reports.

Overall, from 2020 to 2022, Athleta's revenue grew from $1 billion to $1.48 billion in 2022.
The portfolio leader Gap has also succumbed to the decline in American shopping malls, once its retail stomping grounds. Beginning in 2020, both Gap and Banana Republic aimed to close 30% of its retail doors by 2024.

Like many retailers, the Gap suffered from inflation-related pressures on the lower-income customer and leftover supply chain woes that continued in 2022 and continued Covid-related lockdowns and slowed demands in China. Its 2022 first-quarter results were down 11% as compared to 2021. Its first-quarter 2023 net sales were down 13% compared to 2022, down from $791 million to $692 million.

The company recently embarked on a creative partnership it hoped would help regain some of its cool-factor glory days of the early 2000s, when its innovative ads featured duos such as Madonna and Missy Elliot, Lenny Kravitz and Sarah Jessica Parker and The Backstreet Boys, among others.

In 2021, Gap signed a 10-year deal with Kanye West for a Yeezy Gap line. Practically before the results were tallied of its oddly marketed roll-out, West blew up his lucrative deals with the San Francisco retailer and shoes partner Adidas in a tirade of racist and anti-semitic remarks.

Gap Inc. wrote off $53 million in impairment charges related to its Yeezy Gap brand.

For his part, among other things, Dickson brought Barbie to its highest earnings in 20 in Q3 2020, effectively helping the fashion doll regain ground lost to competitors such as Bratz and Monster High dolls popular among Gen Z.

He also led the charge on diversity initiatives by offering over 176 Barbie styles that varied according to skin tones, hairstyles, and body types as well encouraged parents and caregivers to promote diverse and non-gender conforming play with the #MixItUpToyBox challenge along with launching several designer fashion collaborations.