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Gap CEO Weighing Brand Licensing, New Marketing

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Times Staff Writer

Three months after taking the helm, Gap Inc. Chief Executive Paul Pressler is considering licensing the brand internationally and starting new labels under which to sell apparel, according to an analyst’s report released Friday.

Pressler, who has declined media interviews, also told retail analysts that Gap is looking at ways to market its products better to customers, including by interacting more with shoppers in Gap stores.

Pressler believes that Gap’s customers have an “emotional connection” to the brand but that the stores need “more theater,” analyst Joseph Teklits of Wachovia Securities said in his report. Gap wants to understand its customers’ “emotional insights” and will communicate with them via exit surveys and other means. The company also believes that it can improve by profiling customers according to lifestyle and geography, the report said.

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Gap recently hired advertising agency Leo Burnett USA to evaluate the “emotional attributes” of Gap’s brands.

“In an increasingly dynamic marketplace, Mr. Pressler acknowledges the need to monitor and carefully listen to its customers,” analyst Jennifer Black, with Wells Fargo Securities, said in another report Friday.

Stores also need to improve selling strategies, such as getting customers to try on items, which quadruples the likelihood they will make the purchase, Teklits’ report said.

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The discussions with investors and analysts were informal and did not reflect any strategic shift for the San Francisco retailer, spokesman Alan Marks said.

“Our clear focus now is on our current businesses -- Gap, Banana Republic and Old Navy -- and continuing the turnaround of those businesses and restoring” comparable-store growth in those businesses, he said.

Still, the firm has been trying some new initiatives. After testing the sale of maternity clothes on Web sites and in a few stores, Gap and Banana Republic will sell maternity clothes in more stores next year, Marks said.

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Gap’s stock closed Friday down 15 cents at $15.70 on the New York Stock Exchange.

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