Mature Clients a Better Fit

Gap Inc., battling to win back customers, is among several apparel retailers that targeted younger shoppers only to incur the wrath of one of the world’s most powerful consuming groups: female baby boomers.

Other companies that also swerved to snag younger customers, losing some core boomer shoppers in the process, include AnnTaylor Stores Corp., Nordstrom Inc. and Talbots Inc., analysts say.

And it’s not always easy to win back these shoppers once they stray because other retailers--including discounters Target Corp. and Wal-Mart Stores Inc. and specialty chains such as J. Jill Group Inc. and Chico’s FAS Inc.--have moved quickly to lasso them.

Retailers’ inclination to target teens in recent years has baffled analysts because the nearly 40million women ages 38 to 55 have the most money to spend.

“It seems odd that there aren’t more retailers looking at that customer,” said Dorothy Lakner, an analyst with CIBC World Markets. “I can make a much longer list of teen concepts than I can of concepts for baby boomer women.”

That could be because the boomer concept just isn’t as “sexy” as the teen concept, she said.

But Chico’s, for example, is gaining market share by wooing boomers with comfy clothes, special promotions and personal service.

Most Chico’s dressing rooms omit mirrors to encourage shoppers to step out and have more contact with a salesperson to help “build a friendship,” spokeswoman Lexi Winkles said.

While boomers may be more interested in finding the right clothes than palling around with salespeople, catering to these consumers does require skill and delicacy because they are particularly sensitive about aging, retail experts say. And, while they demand comfort, they have no intention of parading through middle-age in dowdy clothes.

“Her body isn’t what it used to be,” said Elizabeth Pierce, an analyst with Wedbush Morgan Securities, describing the typical boomer shopper. “She wants to look trendy and sophisticated, but she doesn’t want to look juvenile.”

Kathie Young, an ad agency owner who shopped in Chico’s this week, said she wants comfortable clothes but doesn’t want it to look like that’s the reason she bought them.

“I’m into self-deception,” the Costa Mesa resident said.

Candace Corlett thinks it’s wrong-headed not to go after the well-heeled generation of boomer women.

The partner with WSL Strategic Retail, a consulting firm in New York, advises clients to nab boomers by using ads that feature “ageless” looking women, and never to use bold print that could remind boomers that they need reading glasses.

Corlett said she wrote a letter about baby boomers to Gap Chief Executive Millard S. Drexler in 1998 but was told that “the 50-plus target wasn’t right for Gap.”

Certainly, San Francisco-based Gap has never been geared to senior citizens. But it is a brand that baby boomers helped build, and some analysts say the “ageless” styles of much of its original clothing could easily have followed women into their middle years.

Instead, Gap weighed in heavily with hip huggers last year, not the kind of thing to draw Kathi McGraw, 55, a Cypress resident who said she’d buy more clothes at Gap if they fit her.

“My body doesn’t fit their pants anymore,” McGraw said.

Indeed, such mistakes can be costly to retailers.

Appealing to a younger, or trendier, customer forced Gap to compete more directly with a growing number of companies filling that niche, including Abercrombie & Fitch and Wet Seal Inc. But these younger shoppers didn’t have the emotional connection to Gap that earlier customers did, analysts say.

“Their parents know the Gap,” said analyst Kurt Barnard, president of Barnard’s Weekly Retail Marketing Report. “Their parents lived in the Gap.”

Gap’s shifting strategy also gave discounters, such as Target and Wal-Mart, a chance to develop what Barnard calls “Gap-type departments” with basic apparel at lower prices.

Gap lost nearly $8 million in 2001, which Drexler has said was the company’s most difficult year. Gap’s stock has lost more than half of its value over the last year.

It closed Friday at $14.06, up 21 cents, in New York Stock Exchange trading.

Drexler--who now admits that Gap did “move a little too young” in the last year or so--stunned analysts Tuesday by announcing that, after 19 years with the company, he will leave as soon as a replacement is found.

Drexler said he believes Gap now is moving in the right direction with products that helped define the brand, such as white shirts, boot-legged jeans and khakis.

Pants will have a more “democratic” fit, Gap executives said in a recent conference call. “In response to demand from our women customers, we’re bringing back stretch in a big way,” Drexler said.

When New York-based AnnTaylor got too trendy about a year ago, the results “couldn’t have been uglier if they tried,” said analyst Jennifer Black with Wells Fargo Securities.

“It was orange, it was hot pink, it was ruffled, it was stripes,” she said. “People hated it.” Based on the company’s more recent merchandise, Black said she wrote a report on the company entitled “Ugly No More.”

Hingham, Mass.-based Talbots--known for its classic apparel--also flirted briefly with younger customers a few years ago and then returned to more familiar territory, analysts say.

Seattle-based Nordstrom added younger-looking clothes in departments where the offerings had been geared to an older customer. The chain also experimented with brighter colors on walls and replaced piano players in some stores with jazzier music, analysts say.

Each of these companies has backtracked, analysts say, with varying degrees of success.

Meanwhile, Fort Myers, Fla.-based Chico’s sales rose almost 46% last year and earnings grew almost 49%. Its stock has gained 82% over the last year and is up 50% in 2002. The stock closed Friday at $38.51, down $1.08, on the NYSE.

The company’s new catalog features models of indefinable ages wearing crop pants, loose shirts, straight dresses and bold jewelry. Not a single blouse is tucked in.

J. Jill also has won followers with loose-fitting clothes that still look stylish.

Kim Martinez, 49, shopped at Chico’s for the first time Wednesday, trying on various tops with red-cropped pants.

The Laguna Beach homemaker said she knows precisely what she wants.

“I want to look like I did at 25, before we boomed,” she said.