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Behind the Numbers: an EMARKETER Podcast
Does Every Retailer Need a Chief Entertainment Officer (Like GAP)? | Reimagining Retail
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- [00:01]
A
Hi, everyone. Today is Wednesday, March 4th. Welcome to eMarketers weekly retail show, Reimagining Retail, an E marketer podcast. This is the show where we talk about how retail collides with every part of our lives. I'm your host, Susie Dava Kenyon. On today's episode, we're breaking down Gap's fashiontainment push to assess whether this is a headline grabbing moment or a meaningful evolution for retail. Joining me today are two podcast regulars. Joining from just a few blocks away is senior analyst Blake Drosch. Hey, Blake.
- [00:32]
B
Hey, Susie. Good to be back.
- [00:34]
A
Thanks for joining us. And principal analyst Sky Canavas joining us from Texas. Hey, Sky.
- [00:39]
C
Hey, Susie. Glad to be here.
- [00:41]
A
Thanks for joining us. So this week we're going to talk about how Gap is hired a chief entertainment officer. And if you've been listening to us and you've been reading our work, then this shouldn't feel completely out of left field. In our 2025 retail trends, we called out that retailers would take a bigger stake in media and entertainment and then we would start to see a blurring of the lines, content and commerce. So now we're seeing that idea play out in real time in a more structural way. Of course, Gap is leaning into what it calls fashionment, opening an office in Los Angeles and building partnerships across music, film, sports and gaming, all with the intended goal of creating fandom and driving long term relevance. So today we're going to unpack that a little bit. What does that mean for retail? And is this really a smart evolution or a risky distraction? So before we dig in, you guys, I want you to tell me if you have watched a piece of long form branded content, whether it was Barbie a couple years ago, one of the newer Lego movies, something from a luxury house, maybe the Hershey's story. Have you watched any, Sky?
- [01:47]
C
Well, yeah, I definitely watched the Barbie movie with my daughter and we both really enjoyed it and I think it was a great piece of brand content that told the story and really drove a lot of affinity for the brand and purchases. Possibly, possibly. We have Barbies in our home and all of their homes and accessories. And I can't, I can't say if they're incremental to the movie or if we would have purchased them anyways because I am a, I grew up with Barbies and so it's, it's part of my daughter's life too.
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A
Yeah, there is a nostalgia about Barbies. What about you, Blake? Did you see any? Have you watched any?
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C
Yeah.
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B
Also, big fan of the Barbie movie. I would be remiss as well if I didn't mention also the 2016 movie, the Founder with Michael Keaton about the founder of McDonald's, which I think is also a great movie about the birth of an iconic brand and definitely
- [02:51]
C
made
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B
me hungry for McDonald's.
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A
Oh, that's cool. Was it a documentary, though, or was it, like, meant to be entertainment?
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B
No, it's a. It was like a. It was a feature film.
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A
Oh, really?
- [03:01]
C
Yeah.
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A
I don't know that one. I recently saw the Lego movie. It was the Pharrell Pharrell story. We didn't realize that it was more like a documentary guised as Legos. And so we went with a not toddler, but not. Not adult who wanted to leave halfway through the movie because it did not hit home for him. So that was kind of an interesting move and it gets us to really. What is Gap doing? I know Richard Dixon came out of the company or came to Gap fresh off of the momentum from Barbie at Mattel, but is it possible for Gap to recreate the same thing? Is introducing a chief entertainment officer really going to help solve the problem of retailers maybe needing a little bit more community and people into their fold?
- [03:47]
B
I think the examples that we just gave of sort of like, feature films that really have, like, legitimate cultural relevance is something that is very difficult to do and also seems very difficult. Very different from what, like, the Gap is doing here, which is trying to basically establish a department that is going to facilitate partnerships across the entertainment space. And I think, you know, the biggest thing right now is that we don't really know what is that going to look like. Right. I mean, Gap and countless other retailers have worked with celebrities to, you know, create content, endorse product lines, you know, three times the world over. Right. I think I'm just wondering how exactly this is going to look different.
- [04:42]
C
Yeah, I think we've seen some hints, but I think this appointment really centralizes or puts the spotlight on the fact that Gap wants to put, like, Capital E Entertainment at the center of its brand. And I think that's necessary because it's a fashion brand and there are so many fashion options, there are so many new brands and dupe brands and then so many channels so that customer relationships are being dispersed. So it's hard to maintain loyalty across brand and channels. So it becomes ever more important for a brand like Gap that's kind of a mid market mass brand, it risks falling into the middle of not very special or casual brands that don't have a strong brand. Identity. So Dixon has been tasked with reinvigorating the Gap brand as well as the other brand, Old Navy, Banana Republic, Athleta. But I think the flagship Gap brand is still at the spotlight and it gets the most attention. I think he's done a pretty good job with that over the last couple of years. We've seen hints of it. I think the big one that really caught everyone's attention recently was the Cat's Eye milkshake video collaboration. And I think even maybe the Gap was surprised by how much it resonated and how viral it went. I, I feel like I could hear it in Dixon's voice on the earnings call when he talked about how excited he was about it. And we've seen some other efforts like the denim ball gown at the Met Gala. There was an Anne Hathaway dress that went viral from the Gap, a very simple dress. And they recently also had a White Lotus Banana Republic collaboration. So I think the role of the Chief Entertainment Officer will be to think more broadly and how to kind of link those viral moments to create a cohesive brand narrative or strategy that can capitalize on viral moments but isn't solely dependent on them.
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A
It's interesting. Obviously we don't have their job description, but it is two completely different takes, right? It sounds like on the one end we think it's an extension of marketing and then trying to figure out what that distinction is because technically that's what marketers are doing today.
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C
Right?
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A
What is the right brand partnerships? What are the right pop up moments to have? What are the cultural sort of getting ahead of? Even if you think about Wicked and having all that green merchandise everywhere. So that sits in marketing today. But the point you made sky, about the E with a capital for entertainment is one that maybe we can explore a little bit more because that's where it comes to be beyond marketing.
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C
Right.
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A
How do you stay relevant and insert yourself in a more seamless way across different touch points?
- [07:28]
B
It's maybe a little bit easier to understand what this role is going to look like when you understand what it's not going to include. And if you look at the last line of the press release announcing the role, it said that brand teams and presumably at, you know, the individual company. So Gap, Old Navy, Banana Republic will continue to lead creative vision, product direction and campaigns. So really I think this, this position is going to sit above that, which is, is pretty high level.
- [08:03]
A
So CMOs for each individual brands, they'll be doing like campaigns, more performance, brand communications. And this new CEO of Entertainment they're going to do more. The IPS and the partnerships that really help G think be in the sort
- [08:18]
B
of cultural moments, presumably. I think that's. It's hard to. It's hard to sort of comprehend what exactly that's going to look like if you're sort of sitting above all of the individual brands and you are necessarily going to have a direct purview into things like marketing campaigns and product direction.
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A
Right.
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B
Which presumably does include things like collaborations. So, yeah, big. A lot of question marks and maybe
- [08:46]
C
we will get a Gap movie of the Mickey Drexler era in the 1980s.
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A
I've met him. He's so iconic.
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C
Yeah.
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A
You never know.
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C
He would make a great movie character.
- [08:57]
A
He sure would. But for me there really is. I'm going to keep pressing on this because for me there is this tension sort of between what a marketer's role is and what the entertainment person's role will be. And do we think. I mean, we talked about this after nrf. Retailers are thinking about different ways of having ancillary revenue. Revenue. Is this just another way of trying to think about more ways to make money?
- [09:22]
B
That's a. I think that's a good thought. I mean if there's. There's probably potential for that. Right. So if you think about, you know, some sort of event creation or partnership with an already well established event, I think that could be something that would be, you know, pretty, pretty ripe for this role. But yeah, I think it's like something that also we've seen play out many times. Right. Is sort of. How is this different from a cmo? Is this, you know, basically just a CMO that has a different brand name around the title. Right. Or way of branding the title. And I think that, you know, as over the years we've seen Chief Brand Officers, Chief Digital Officers, chief Creative officers, like Chief Growth. Is this just still. Yeah, Chief Growth officers like Chief Customer Officer. Like it's almost like they're running out of, you know, new C suite names that are essentially just maybe a different flavor of cmo. But I think this, this move, you know, runs the risk of sort of being added to the long lineage of sort of CMO adjacent C suite jobs that aren't at the end of the day super entirely distinct?
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C
Yeah, I think the title was maybe partly designed to grab headlines and capture attention and create some short term buzz, but I think longer term, I think it signals an emphasis on the quality content, that it's not just going to be advertising campaigns or performance marketing and that what Sits at the top will be higher quality entertainment content that's linked to culture and that has broader relevance and making sure that you have the organizational structures to support that and that the CMOs understand that and that their campaigns also are relevant to the broader goals. And I think different brands might approach this differently. Like some could launch a production studio. We've seen some do that. Like Fanatics recently launched a production studio centered around sports content. LVMH has a studio that's really focused on luxury adjacent storytelling. Or it could be through a creator program that emphasizes storytelling. Like Dick's recently expanded its creator program beyond its employees or store associates to include more athletes and people who have compelling stories to tell. Because that in itself is also a form of entertainment.
- [11:52]
A
It's true.
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C
Right.
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A
And we are looking for different sort of signals in the noise. And how do you bring yourself and bridge yourself to things, people, partnerships that make sense for your brand. I think for me this became more than a buzz when they also said they're opening an LA office. Right. So it's like they're trying to figure out a whole ecosystem that's repeatable so that they can prod produce content, create this fandomness. But my question to you is in addition to how are they going to measure success? Because I definitely want to talk about that. What comes first? Is it the merch? Like if you don't have great product, then will people come to you and buy the things? Like will it really create that ecosystem that includes merchandise and sales or do we have to wait and see?
- [12:38]
B
Your point about the LA based office seems like kind of like almost an antiquated way of wanting to position yourself. The entertainment industry that has become so dispersed and it's not really centered in LA much at all at this point, but maybe they're just, you know, yearning for a time where Gap was more relevant and you know, the entire entertainment world revolved around Sunset Boulevard.
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C
And I think maybe it's a little telling when they named Kaufman as the chief entertainment officer. It. It says that she's going to split her time between LA San Francisco, where Gap is headquartered, and New York, which is also the other entertain capital of the U.S. yeah, it's interesting.
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A
I wonder what's going to happen with the merchandise and if she's going to work with the chief merchant, another C suite and a retailer to ensure that they really do have that full story. As you were saying before Sky, I think this elevation also means it's all the different touch points across everything from merchandising to TikTok, to, to everywhere. So how do you guys think they're going to measure her success in 12 months? How do we know if she's made a difference?
- [13:46]
B
That's a good question. I think there's probably gonna have to be leniency because it isn't sort of a new role, it's an ambiguous role and it's a role. I think the Sky's point really revolves around long term initiatives. I think this is a clearly a role that sits within the realm of brand building, which is already always hard to measure, even if it's fully operating at scale. But I think that, you know, in order to sort of justify the expense of this department, there's going to be one, you know, big piece of media that is going to have to emerge from this. Whether it's again, like a big partnership with an event like Coachella or a, you know, unique partnership with a celebrity that's going to, you know, bear the fruit of some sort of, of content that is generating buzz. But I don't necessarily be see this as something that could be measured by any type of really sort of traditional metric.
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C
Yeah, it can be tough. Like there are like media impact value measurements that look at campaigns and how much buzz they generate and how much that would be worth. And you could look at brand building measures like unaided brand awareness, brand affinity, new customers or new to brand customers and then. But I think over long term we'll be looking for some bigger impact on sales, particularly for the Gap brand. The company as a whole is doing well, but a lot of the growth of recent quarters has been coming from the old Nathie brand, which is very value focused. The Gap brand is not losing sales, but it's not really accelerating that quickly. And I think we'll hear more in the coming earnings calls and in the coming quarters over how the performance is shaping up and building on the campaigns that have already taken place and the ones that are to come.
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A
It's interesting because I don't know how many people realize that Gap Inc. Has all these brands. Right. And so if you think about having this chief entertainment officer, are they going to be able to really do work their magic across all the different brands or are they going to just worry about one brand? There is this elevation component, like you were saying, Skype. But they were already doing a lot of these things, right, like the Met Gala. It's almost like you said it before and it stuck with me that they were caught off by surprise with some of their moments that they created that went viral. And so maybe this is how they're going to measure if she's able to capture and continue keeping that viral, those viral moments in her ecosystem.
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C
Yeah, it seems like a next step in a gradual progression, and brand turnarounds can take a while to realize their full potential. I mean, it started with the appointment of Richard Dixon, and then he brought Zach Posen on board as, like, the creative force behind the brands and now a chief entertainment officer. And I think a lot of the emphasis will be on the Gap brand because it's a flagship. It's the brand that's being elevated. They've done a lot of collaborations or more upscale products than what we would typically associate with the Gap in recent years. Eventually, they'll have to turn to the other brands, Banana Republic and particularly Athleta, that have been dragging down on the growth of the overall company.
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A
I still think merch is at the base of this. I, for the first time in a very long time, was gifted Gap clothes, and apparently it's what all the cool kids are wearing right now. And people saw my sweater and were like, that's Gap. It was like some cable knit thing. So I think it starts with merch, but we'll see. So my question to you then is, is this a bold move? Is it really transform or. I think, you know, where I stand. Is this a distraction from retail fundamentals?
- [17:49]
B
I would say it's probably somewhere in between. Like, I don't think. I think it's smart. I mean, I don't think all the cool kids are wearing Gaps are to burst your bubble, Susie. Like, I think that they're. They've turned it around a little bit, but I think that they have a long way to go, honestly, before, like, they become. They can restore the cultural relevance that they once had. And I think that you have. Something like this has to, you know, happen in order for that to. For. For the momentum to continue. But I. I do think that, you know, the fundamentals are obviously still very important and they, you know, still do, like, have a lot of work to do, I think, in improving just the. The relevancy of the products that they offer and the. Not to mention the online shopping experience. I mean, looking at a category, is
- [18:38]
A
this the one where you try to return and you had so many issues? Is this the one from a couple years ago? It's probably better.
- [18:44]
B
No, I've always. I've been good with it. I am a. I am a Gap. Pretty loyal Gap customer. I will say.
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A
You're a cool kid.
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B
No, that's that's not those two things do not go hand in hand. But I will say that, you know, again my E commerce is a category. You know, apparel is a category. 38% of sales roughly come from online. And I wouldn't say that their E commerce experience is, you know, cutting edge.
- [19:16]
C
I mean I think it is a bold transformation move that is becoming more fundamental to brands in retail just because the environment is so much more competitive than it was 20, 30 years ago when GATT was at its heyday and had a central role in our culture. The it it faced a lot less competition. We didn't have all these online brands and dupes competing for attention and channels like social media and TikTok influencers where you can find the hot new product or the dupe of the Gap product that you're looking for. So they have to work that much harder to cement themselves in consumers wallets and hearts.
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A
It's true. So maybe it has to go together, right? The merch has to be solid but but the entertainment piece has to amplify the cool factor so that everybody agrees with me that it is the cool brand that's back. If you think about Gap is huge, right? And has a lot of brands. Can every retailer do this? Is it scalable?
- [20:19]
C
I think every brand should have a brand building content strategy that has a strong entertainment or cultural component. Whether it's capital E entertainment like a Hollywood film or just telling brand stories through micro and nano influence influencers. Entertainment nowadays takes so many forms. It's not just fictional or scripted content. It's reality program, it's watching sports. And there are brands that have taken off with selling on TikTok shop for example, because their founders are making content that audiences want to tune into. It can be both entertaining and informative. And then there are others that take a low budget approach, creating humorous content that will build more brand goodwill.
- [21:03]
A
I think that sums it up really nicely Sky. And you know what, it's all the time we have for today. So thank you Blake. Always a pleasure and thanks Sky.
- [21:11]
C
Thanks for having me Suzy.
- [21:12]
A
And thanks to our listeners and to our team that edits the podcast. Please leave a rating or review and remember to subscribe. I'll see you for more reimagining retail next Wednesday. And on Friday join Marcus for another episode of behind the Numbers, an E marketer podcast. Sam.