Gap Inc. is making its most ambitious move yet into beauty and accessories, enlisting two influential industry names — Reed Krakoff and John Demsey — to help steer the categories as new growth engines for its portfolio, which also includes Old Navy, Banana Republic and Athleta, the company announced Wednesday.
Krakoff, best known for his namesake label, which shuttered in 2015, will serve as executive director of accessories. Demsey, credited with building Estée Lauder Companies’ MAC Cosmetics into a global powerhouse, will take on the same role in beauty. The Business of Beauty first broke the news earlier this month. Krakoff’s hire builds on Old Navy’s recent expansion into handbags, while Demsey will advise on the group’s beauty roll outs. Both will function as consultants to the company, according to a company spokesperson.
To execute the strategy, Gap has also appointed Deb Redmond, a Nordstrom veteran, as general manager of beauty, and Michele Parsons, formerly of Kate Spade and Coach, as general manager of accessories. They will report to Eric Chan, Gap Inc.’s chief business and strategy officer.
The move comes as chief executive Richard Dickson, who took the helm in 2023, has restored momentum at the long ailing retailer. Dickson, formerly president of Mattel, brought in designer Zac Posen as creative director, part of a broader effort to sharpen brand relevance in popular culture and revive growth across Gap’s portfolio.
Gap Inc. plans to launch beauty at Old Navy this fall in 150 stores, many with shop-in-shop formats staffed by trained associates. A Gap-branded beauty line will follow in 2026. Accessories, meanwhile, will expand across handbags, jewellery and leather goods in phases.
Adding a more substantial beauty offering is a win — on paper. Old Navy’s proposed offering will include lower-priced goods like fragranced body mists and trendy brands like TonyMoly and E.l.f. Beauty, which it currently stocks. A wider, trendier offering should attract young customers and their (and their parents’) wallets. Gen Alpha and younger Gen-Z shoppers are voracious consumers of beauty, especially in the impulse category, and have made affordable brands like Starface, Touchland and even Aquaphor into viral hits. Still, it’ll be in competition with beauty retail juggernauts like Sephora and Ulta Beauty, many of which can be found in the same malls as Old Navy and Gap, as well as TikTok Shop’s ever-increasing offering.
The value of Gap Inc. stock has surged since Dickson joined the company in 2023 but topline growth has been slow, albeit consistent. In its last quarter, net sales across the company were flat, though comparable sales — a metric of in-store revenue — rose 1 percent. Every brand posted an increase except for Athleta, which has struggled to compete in the crowded activewear space in recent quarters.
Launching new product categories is a tried-and-true method to boost growth and acquire more of customers’ share of wallet, and in the case of beauty, boost margin, even with Gap Inc.’s promotional-heavy strategy. But it’s also a risk. For Gap, which has only recently begun to recover its reputation for reliable basics, suddenly selling beauty products (currently it carries some Mersea hand soap and candles) could be confusing to shoppers and distract from its brand rehabilitation. It has also tried to incorporate beauty and personal care into its stores many times since the 1990s with varying degrees of success.
“Handbags are a natural extension of apparel, but beauty is another story,” said Gabriella Santaniello, a retail consultant based in Los Angeles. “How is it going to be differentiated? What’s the value proposition? And do people really want to buy their clothes, their jewellery and their makeup at the same place?”
Even so, Old Navy’s recent foray into handbags has been a success. Designed by Posen, the line features a range of totes, shoulder bags and clutches all under $50. The launch made a splash with a slew of celebrity endorsements in the form of paparazzi shots featuring the Carrie tote collection, donned by Jenna Ortega, Brenda Song and Shailene Woodley.
Unlike in beauty, according to Santaniello, there is little competition in offering affordable handbags. “There’s Target and Amazon, but in terms of seeing it in person, Old Navy could have a nice edge in that regard,” she added.
