The Steve Jobs of Gap? - Trapital | Wave AI Podcast Notes

Trapital Podcast Summary: "The Steve Jobs of Gap?"
Host: Dan Runcie
Date: July 3, 2020
Episode Focus: The risks and potential of Kanye West's landmark partnership between Yeezy and Gap Inc.

Episode Overview

In this insightful episode, Dan Runcie breaks down Kanye West's 10-year Yeezy partnership with Gap, analyzing its implications for both the Yeezy brand and the struggling retailer. Runcie explores Kanye's journey through the fashion industry, the dichotomy between hype-driven exclusivity and mainstream appeal, and the steep challenges of turning Gap into a cultural powerhouse. The analysis draws parallels between Kanye’s ambitions and Steve Jobs’ return to Apple, questioning whether history can repeat itself in retail fashion.

Key Discussion Points & Insights

1. Why the Yeezy-Gap Deal Matters

The deal marks a full-circle moment, as Kanye worked at Gap in high school and long expressed a desire to collaborate with the brand.
Fan reactions are split:
- Old-school fans recall his song “Spaceships,” referencing his Gap experience.
- Hypebeasts lament Yeezy's transition from scarce, exclusive products to mass-market availability.
- Runcie: "The sneaker lost its allure as it slowly became a mass consumer product… The Yeezy brand is a long way from the infamously limited Red Octobers." (02:04)
Core question: Can Yeezy maintain its cultural cachet while chasing mass market ambitions through Gap?

2. Kanye’s Fashion Industry Journey

Nike Era:
- Kanye initially collaborated with Nike, seeing it as a dream come true:
- Quoting Kanye (Nike Press Release, April 2009): “Growing up, we looked forward to the release of the new Nikes the same way we would an album by our favorite artist… a dream come true and a great experience.” (03:23)
- Desiring a Jordan-level royalty deal (5% royalties) but denied due to not being an athlete.
- Famous Hot 97 interview (2013): “I’m a performance athlete who goes to the garden and plays one on no. 1.” (04:16)
Louis Vuitton (LVMH) Rejection:
- Similar struggles for leverage and access; Bernard Arnault didn’t take Kanye’s calls.
- Runcie summarizes: "Hunger can't close deals… Replace LVMH with Nike and replace Arnault with Mark Parker. It's the same script, different company." (05:28)
Adidas Partnership:
- Adidas offered Kanye royalties and creative freedom.
- Adidas wanted relevance in North America; Kanye needed international distribution—mutually beneficial.
- Results:
  - Yeezy became the ninth highest-selling sneaker in 2018, outselling Nike’s Air Force 1, earning $1.3 billion in 2019.
  - Runcie: "Sneakers were no longer fast fashion. They were widely accessible… The increased supply puts sneakerheads… in a bind. They don't gush over readily available products. The chase is part of the allure." (07:45)

3. The Risky Shift to Mainstream with Gap

Kanye wants to design a “perfect hoodie” for the masses, inspired by Costco’s approach:
- Kanye to WSJ (March 2020): “I like Costco as an idea. I like Walmart too.” (09:08)
Gap is a logical channel for affordable, mass-produced Yeezys but faces major retail headwinds.
Gap’s struggles:
- Declining since the '90s.
- Reliance on Old Navy and Athleta for revenue.
- Discount culture threatens Yeezy's premium brand.
Runcie asks if Yeezy Gap can be like Martha Stewart's Kmart line, which hit $1B in sales but still couldn't save Kmart from bankruptcy.
- "At its best, Kanye extended the life of a department store that got trapped between Walmart, Target and its never ending Blue Light specials." (10:55)
Kanye’s vision likened to Steve Jobs’ return to Apple—but Runcie is skeptical:
- "In Kanye's mind, this is his Steve Jobs 1997 return to Apple moment… But the $60 hoodie can't match the impact of the iPod or the iPhone." (11:26)

4. Tension at the Heart of Yeezy

Yeezy thrives on hunger—from Kanye’s drive, customer desire for exclusivity, mass hopes.
With the Gap partnership, the roles are reversed:
- The brand and its founder have arrived.
- Gap is now the hungriest party, hoping Kanye can revive its fortunes.
Runcie closes: "Maybe the real dream was the journey it took to get to this point." (11:55)

Notable Quotes & Memorable Moments

Kanye on Nike collaboration: “Growing up, we looked forward to the release of the new Nikes the same way we would an album by our favorite artist. The opportunity to collaborate… has been a dream come true.” — Kanye West (03:23)
On sneaker culture: “The chase is part of the allure… On All Falls Down, Kanye rapped, ‘then I spent 400 bucks on this just to be like, nigga, you ain’t up on this.’ That’s the same mentality etched in the brain of every Yeezy loyalist.” — Dan Runcie (08:10)
On Gap’s retail strategy: “Gap is a perfect place for $60 hoodies stacked on tables like loafs of bread. But Gap is also a place where $60 hoodies get placed on 60% off clearance racks on President’s Day.” — Dan Runcie (09:40)
Paralleling Jobs/Apple: "In Kanye's mind, this partnership is his Steve Jobs 1997 return to Apple moment. … But the $60 hoodie can't match the impact of the iPod or the iPhone." — Dan Runcie (11:26)
Summary insight: “The only one hungry is the struggling retailer that hopes its former employee can turn the company around.” — Dan Runcie (11:45)

Timestamps for Key Segments

00:00–01:00 — Episode introduction; setting the stage.
01:00–02:40 — Context: Kanye’s history with Gap and fan reactions to the deal.
02:40–06:00 — Kanye’s fashion journey: Nike, Louis Vuitton, lack of leverage.
06:00–07:30 — The Adidas partnership: mutual growth, culture, and Yeezy’s evolution.
07:30–09:30 — Transition from hype culture to mass market, the dilemma of supply and demand.
09:30–11:20 — The risks of partnering with Gap; comparison to Martha Stewart/Kmart and Steve Jobs/Apple.
11:20–12:00 — The fundamental tension: hunger, exclusivity versus mass success.
12:00–12:10 — Closing thoughts.

Conclusion

Runcie’s analysis is a compelling look at the crossroads of culture, commerce, and ambition that defines the Yeezy-Gap deal. Can Kanye victimize Gap’s legacy woes or is he risking his brand’s allure by going mainstream? The existential questions of hype, accessibility, and reinvention anchor this episode—and leave the listener pondering if Kanye, or anyone, can truly be “the Steve Jobs of Gap.”

Transcript

A (0:00)

Foreign hey, welcome to the trapital Podcast. I'm your host Dan Runcy. Today's podcast is all about Kanye west yeezy and the 10 year deal that he just signed with Gap Inc. One of the great things about trapital having a passionate reader base and listener base is that people will say exactly what they they want to hear about. And I've gotten many inquiries about Kanye west in this deal since it first got signed. It's been on the top of my mind ever since it got signed as well. So let's get right into this. This is a audio version of this week's essay why Kanye West's Gap Deal Is a Risk to Yeezy Yeezy's new partnership with the struggling apparel company is a threat to the brand that Kanye west built Kanye West's Gap deal has drawn a wide range of reactions. The college dropout fans thought back to spaceships, the 2004 song where the Chicago native complained about how his high school employer treated their token blackie. In recent years, Kanye has shared his desires to partner with the apparel company time and time and time again. This announcement is a full circle moment, but the hypebeasts that drove Yeezy's popularity have less to be excited about. To them, the sneaker lost its allure as it slowly became a mass consumer product. The brand is a long way away from the infamously limited Yeezy red Octobers. The 43 year old billionaire is up for the challenge though. The Yeezy Gap partnership can fulfill his dream to bring fashion to the masses, but there's risk in shifting the the Yeezy brand down market with Gap. Even if the new product line makes money, its potential will be held back by a retailer whose best years are behind it. A brand with something to prove. Yeezy's first partner was Nike. It was a dream come true for Ye, who spent his childhood drawing Air Jordans because he couldn't afford them. Here's a quote from Kanye from the first Nike Yeezy Press release in April 2009 Growing up, we looked forward to the release of the new Nikes the same way we would an album by our favorite artist. So the opportunity to collaborate on a design with Mark Smith and Nike design has been a dream come true and a great experience. It's rare to see Kanye say something this glowing about Nike, but it was all good. Just a decade ago. The first Air Yeezys retailed for $200, but sneakerheads resold them for thousands. Kanye saw the potential and wanted More. He asked Nike for a Jordan brand type deal. Michael Jordan earns 5% royalties on sales from Jordan Brand which made $3.1 billion in 2019. Nike told Kanye that royalty deals were only for athletes. Unsurprisingly, Ye was not having it. In a 2013 interview with Hot 97, he said he told Nike that he was a quote performance athlete who goes to the garden and plays one on no. 1. It's a top 10 Kanye quote in the article. I included a clip of that quote. I'll also include it in the show notes as well. But regardless of Kanye's athlete non athlete status, he lacked the leverage to negotiate. Sure, Air Yeezys were popular, but Nike thought he was just another rapper selling sneakers. It wasn't an in house brand like Air Jordan. The basketball legend's royalty compensation was a trade off for ownership and the incentive to succeed was greater. Lack of leverage was an ongoing theme for Kanye back then. In 2013, he had similar struggles with Louis Vuitton LVMH CEO Bernard Arnault, who didn't take the artist's phone calls. Here's what I wrote in last year's why Rihanna broke Barriers that others couldn't. Kanye might have been correct as he's since proven his talents with the Yeezy brand. But he had no leverage at the time. Bernard Arnault was not scared of losing out on the late registration. Artist Eazy did not incite fear. Keep in mind, this was around the same time Kanye was riding in limos holding plates of food up for Paris fashion designers. He was hungry to get his foot in the door. But hunger can't close deals. Replace LVMH with Nike and replace Arnault with former Nike CEO Mark Parker. It's the same script, different company. Yeezy needed a partner it could grow with. Yeezy and Adidas both wanted the same thing. Adidas and Yeezy had a lengthy courting process in 2013, but it strengthened the bond. Kanye got the royalties, the freedom in the expression that that Nike never offered. It was an ideal match with two partners who wanted more. Adidas had international reach but lacked North American relevance. The company tried to buy American culture with the 2006 Reebok acquisition, but culture does not work that way. Meanwhile, Kanye west had a worldwide brand that needed distribution to match it. That mutual dependency made them both stronger. Kanye's signing rode a wave of cultural resurgence for Adidas. Kanye's signing came shortly after the introduction of the popular Ultraboost sneakers and the rise of Adidas athletes like James Harden, Aaron Rodgers and Von Miller. The Adidas Yeezy partnership had a foundation, but the execution still mattered. Yeezy relied on hype, but Kanye's end goal was to reach the masses. Here's what he said to the New York times in a 2015 interview upon the release of the first Adidas easy quote. But west wants to design what might be called fast high fashion clothes that are truly avant garde in their design, made from the finest materials and that would arrive in lightning quick speeds in stores where they could be bought by the public at affordable prices. He claims that he's not wearing luxury for luxury sake, but rather as a form of research. There is a transition, he says. I need to partake in what's of value and of quality and soul in order to understand it and in order to give back end quote. The limited sneaker releases worked to his advantage. Kanye had a testing ground for products with potential for bigger releases. The economics of fast fashion fit this creative process. It also grew tremendous demand with those who value scarcity. But it created an intriguing dynamic. Yeezy's supply steadily increased. It became the ninth highest selling sneaker in 2018, more than Nike's Air Force 1. It made $1.3 billion last year. These sneakers were no longer fast fashion. They were widely accessible. It's the type of item that a kid can put on his back to school list, and a parent has a real chance to get it. The increased supply puts sneakerheads, the same folks who drove Yeezy's popularity, in a bind. They don't gush over readily available products. The chase is part of the allure On All Falls Down, Kanye rapped, then I spent 400 bucks on this just to be like, nigga, you ain't up on this. That's the same mentality etched in the brain of every Yeezy loyalist. In fairness, most products have to evolve past the early adopters to reach bigger audiences. And those evolutions can frustrate early customers. But hype is different. The evolution is not a feature change. It's an increase of supply. Adidas Yeezy managed this well over the past five years. But Yeezy Gap is a whole new beast. The best case scenario is still Limited. In March 2020, Kanye was interviewed by the Wall Street Journal about his plan to make, quote, the perfect hoodie. It would be made for the masses, sold for $60 or so, and stacked on tables like a loaf of bread. West, who is 42, and his Yeezy label hoped to sell the Perfect hoodie somewhere like a Costco, which he admires for its broad reach and its democratic piles of merchandise. A quote from Ye I like Costco as an idea. I like Walmart too. End quote. Gap is a perfect place for $60 hoodies stacked on tables like loafs of bread. The store was originally called the Gap because it served the Gap between the fashion runways and department store apparel. But Gap is also a place where $60 hoodies get placed on 60% off clearance racks on President's Day weekend and then get an additional 10% off if you sign up for a store credit card that day. Those discount stacking tactics ain't cutting it for a modern brand like Yeezy. Gap has steadily declined since the 90s. Old Navy and Athleta have literally carried Gap Inc. On their backs. Last year, gap itself made 4.6 billion in sales. It hopes Kanye's Yeezy line can bring in 1 billion annually by year five. Similar to Kanye's success with Adidas. But Gap is not Adidas. The Three Stripes had a broader ecosystem that furthered Yeezy's potential. NFL players wore Yeezy cleats in games. Adidas made its budget friendly Yeezy lookalike tubular sneakers, which drove demand without cheapening Yeezys. Gap is not in the best position to do that. It recently sunset its Hill City athleisure company and pulled out of its move to spin off Old Navy. It's been a rough 2020 for Gap. Even without the pandemic. The best case scenario for Kanye. Gap is a partnership like Martha Stewart and Kmart. Martha Stewart Living hit 1 billion in sales in its third year. But despite the success, it wasn't enough for Kmart to avoid bankruptcy. At its best, Kanye extended the life of a department store that got trapped between Walmart, Target and its never ending Blue Light specials. Can Kanye's Yeezy line sell 1 billion by 2025? It's an uphill battle, but not impossible. But can Yeezy turn around the entire Gap Inc. Though in Kanye's mind, this partnership is His Steve Jobs 1997 return to Apple moment. He admired Jobs ability to turn the company around. And this is his chance to become the Steve Jobs of gap. But the $60 hoodie can't match the impact of the ipod or the iPhone. Challenging the status quo has its limits, even for the Louis Vuitton don. Yeezy is a brand that thrives on hunger. The hunger of its founder to prove he matters. The hunger of its customers to get products that others can't the hunger of the masses to hope they can one day get their hands on it. But Yeezy's partnership with Gap flips this on its head. The billionaire founder has proved Yeezy can succeed. Customers aren't as hungry as they once were. The only one hungry is the struggling retailer that hopes its former employee can turn the company around. In Kanye West's mind, he found a partner to make his ultimate dream come true. But maybe the real dream was the journey it took to get to this point. Hope you enjoyed this week's essay. Gotten a pretty strong response from it, which is great. Thanks again.