Product Levels

In pretty much every product category there are various levels that are differentiated by quality, brand equity, service quality, promotional strategies, etc. This is incredibly evident in the apparel business. Gap Inc. is a good example of various "levels" of product within a company and product segment.

Gap, Inc. has had 3 main product lines for a long time. Old Navy, Gap and Banana Republic all cater to different pieces of the consumer apparel market. Old Navy is described as "great fashion, family value." This company has a very strong discount, high volume focus and often offers merchandise at steep loss-leading prices. The amount of people that flock to Old Navy stores early on a Saturday morning once per year to buy 10 pairs of $1 flip flops is amazing. What's even more impressive is how many other items they purchase as a result of their visit that they weren't planning on buying. Old Navy clothing and stores are characterized by a more casual and comfortable feel. Stores are minimalistic and don't offer a high level of customer attention.

The Gap is described as "Iconic, Inventive, American" and offers classic, simple, higher quality clothing at a moderate price point for consumers. The styles are often not as trendy and resonate with a young, but more traditional market segment, often younger mothers. Success in this segment has led to expansions in GapKids, BabyGap and GapMaternity lines. The Gap is targeted towards people who are willing to spend more money than Old Navy level products for a higher quality item but don't want to spend an ton of money on more elite clothing lines.

Banana Republic represents a higher level of apparel for Gap Inc. This company is described as "accessible luxury" and presents consumers with more expensive fabrics and sophisticated designs that resonate with those consumers who desire a more elite shopping and clothing experience. Banana Republic also offers more traditional business attire which often comes with a higher price point. Stores have a higher ratio of sales people per customers. They are also characterized by a more intimate feel in more upscale shopping areas, quite different from the industrial/warehouse look of Old Navy stores.

While athletic apparel can be found at The Gap and Old Navy stores, Gap Inc. recently acquired Athleta to expand its offerings in the women's athletic apparel market. It will be interesting to see how Gap Inc. positions this company in comparison to its other businesses as well as larger athletic apparel focused companies.

These different levels of apparel offerings mimic what is seen in the apparel industry as a whole. There are lower price point products such as clothing sold through Walmart and of course there are brands that are much more strongly rooted in the luxury apparel and accessory markets. The important point is that each clothing line and/or company specifically targets a distinct segment with appropriate products, service levels and promotional strategies to resonate with and meet the needs of customers. The entire marketing mix is important to reinforce the desired message at various product levels. Product, price, place and promotion are all key to realize the end goals of a company.