Name: Most Powerful Women Summit 2019: How Old Navy Is Preparing for Life on Its Own
Uploaded: 2019-10-22
Duration: 12 min 46 s
Description: CEO Sonia Syngal talks about the company's imminent spin-off from Gap Inc.

Welcome Sonya. Thank you. Hi everybody. So, as you just heard, Sonia is in the process of getting old navy ready to spin off from Gap Inc. Next year. And my colleague Phil Barba profiled you and I Most Powerful Women issue that's when you guys have seen around. And there was something from that story that jumped out at me which is you described your attitude and old navy's attitude as being like a teenager who like can't wait to leave the nest. So I want to just hold on to that metaphor for a second asked like what is the one thing you are most Looking forward to being able to do once you're out from the parental eye. [ LAUGH ] Some of us have to think I think far back of what it feels like to be 25, which is what Old Navy is. We're a 25 year old brand and it's been a great thing to be part of a company that has a portfolio of iconic brands. But at this moment, I am so excited about the opportunity to spin and take this moment in our history to be what I like to term an eight billion dollar startup. And so we have the scale and the Ubiquitous aspect of the brand that is big and powerful and connected to the American consumer. And yet there's this opportunity to really think about what we wanna be when we grow up, right? The startup side of it, the opportunity to invent, reinvent, change. So I'm excited about those possibilities that I think as a mono, company as a mono brand company, it will afford us the ability to sort of plot the next 25 years. Well, I mean, obviously you're excited about the possibilities, but there are advantages to being a big company are able to share resources like IT, and you also have this scale to negotiate, with your suppliers, with your partners. So as you stand up as your own company, what do you see as the biggest challenge on that front? Certainly, we've had advantages, with being part of the larger company. [ UNKNOWN ] on its own, though, is sizable. And for our industry, we sit as the Number two biggest brand in America now. And so that gives us a, I think a scale that allows us to get the leverage that we need. That being said, separating a company to two is no small feat. It's like doing brain surgery, if you will, and so we're in the middle of that. I'd like to say it feels a little bit like we're seven and a half months pregnant with a 10 pound baby and we're ready to deliver that baby and. Tired sounds. Yeah, so that is that's the here and now challenge you know, I think post spin it's gonna be about how do we keep a little bit of the the maverick attitude that the brand has how do we not become a Too complacent to competent, how do we stay paranoid, humble and all those things that I think will keep us relevant. I think it's very important in a competitive environment. I like that stay paranoid. So we hear a lot about the retail apocalypse whether or not that's an accurate phrase. And what we see from a lot of retailers is reducing the number of stores, shrinking stores. But Old Navy has announced that you're effectively planning to double your store account. From, I think, around 1, 100 to ultimately 2, 000. So, why when everybody else is going the other way, do you think that's a path forward for you? You know, we have been opening stores for several years now. So it's not really a new strategy per se. It's more sharing more broadly what our strategy has been. And ultimately it all stems from the North Star of our business strategy which is, like we we deeply believe in this notion of the democracy of style. And so what does that mean? So for us, it means a brand in a business that is fully inclusive. It solves for every age, every gender, every income level, every body shape, and every customer. And as we've explored where we show up and where we don't show up We had largely stayed out of towns that are below 200, 000 people as brand. And there are many, many towns across America where I feel like our customers are underserved. I hear from them all the time. In fact, there was a An article in, I think the Cape Cod Gazette or something like that. A few weeks ago, where a customer spoke about the fact that window may be opened in Cape Cod. It was like the cavalry came over the hill because he no longer had to drive 45 minutes to the mainland. So, to me it's taking advantage and, serving our customers more effectively. Well, you talked about underserved customers, and actually right before we came on, you mentioned to me that there is a pilot program that you are in the mixed of that you haven't really talked about much publicly, so can you tell us about that? Sure, I mean under the north style of the democracy of style, we are paying deep attention of our plus custimer, and We've always been in that space. We've had a strong online business, for our past customer we've done a 75 store pilot but we felt like we wanted to go deeper and understand more fully how to best service that population size. And so we went really deep, we lived with some of our plus customers, we shop with them, we We laughed and cried with them. And from that experience, from that human- centered experience our strategy evolved. And so we have a 30 store pilot happening right now where we have created a fully integrated experience in our women's business where you can shop double zero to four x. For every style at the same price, and the reaction that our women are seeing is, that we're seeing from our women, incredible. I mean, they're just so happy that they are being treated like every other woman wants to be treated, and so. And how big is, do you have a sense of how big the plus size Customers is for you? [ UNKNOWN ] the market is under reported. But if you look at the demographics of America, the average size woman is size 16. Right. And so we don't think it's a very well reported segment but a hugely underserved segment. Okay, I wanna pivot and actually talk just for a minute about your path. To Old Navy, and I understand that your interest in fashion and entrepreneur entrepreneurial fashion goes really far back. Yeah, you know, I have probably a classic immigrant experience. You know, I was an immigrant in the country and and from that. I think all the good about which is you get access to all the opportunity, all the education and the tough part of that which is you look different, you sound different, you feel different and so I remember being 12 ish and my full height and Very, very awkward that age is many 12 year olds are and, really nothing fit and that question that we've all asked ourselves, a million times, what am I gonna wear, was a really tough one at the time I, I couldn't afford much, my body was, not easy to dress and so from that, necessity. Was born this, desire to create clothing and, it went from, a need based thing to a passion and really my formative years in my teen years was spent doing that and designing making clothes and it became a passion. But again back to, I think an immigrant background, then when I think about. Really where my parents came from, which was not a lot, in fact, less than not a lot. Really the educational guidance was, you really pursue professional or education that is more secure, more established. So my sister became the doctor, I became the engineer. Yeah. And I think that's probably a familiar story to some in the room. It was a great path though. Because really, my love of making things. I did mechanical engineering. I worked in the auto industry for six years. And the product is really the red thread for my career. Whether it was clothing or cars or Or computers, sometimes, as well. From fashion to engineering. Yes. Back to fashion and, plus, engineering. Yes. Any questions for Sonia in the audience? Questions? We have one, over here. You know the drill. Please identify yourself Hi, Carla Blacker from Dutch Villa Germany's international broadcaster. Do you have plans to also spread out in Europe? You know we are I'd say we're pretty young in the arc of our brand life. You know, we're 25 years old many apparel brands. That we compete against our 50, 60, 70 years. And so, I think as we look at global expansion, it's a long journey for us. We're focused primarily in North America. We have some franchise businesses in about 15 countries. So more to come as the years unfold. I have a question. You mentioned working briefly in the auto industry? Yes. So Sonya worked in a Ford [ UNKNOWN ] plans in college, right. So you were in your twenties. You are supervising men who are probably twice, three times as old as you were. What are that experience teach you about managing? Yeah, it was a fun, fun time, I guess I'll use that word. [ LAUGH ] [ LAUGH ] To cover up some of the other feelings. [ LAUGH ] It was fascinating, it was a union shop, it was the midnight shift, it was I bought a boiler room job, if you will. Okay. You know, and it was but at the same time, you know what you really learn is people are people and connecting with people about what matters, what's important is the ultimate connector, so, got through it and I think enjoyed it in the end. And you know every opportunity like that is a learning opportunity and something you take with you. Now. I also have a question about your predictability. So that you've said that the big part of your job at Old Navy is looking a year I had, two years I had to figure out what is gonna be back? Has anything surprise you on your time? Well, some things are definitely interesting. A great brand is a brand that you can rely on and count on. And that's what we strive to do at the same time, fashion is forever changing. Mm hm. Right? And it is remarkable when you step back and you think about how people dress, and how that's changed over the years. I'll share an example of seven, eight years ago, we did not even have an active business, for example, right? And now our active lifestyle business is a billion dollars of our eight billion and the casualisation of how Americans dress Continues. You recently hired an executive from Athleta. That's right. That's right. My Chief Creative Officer has joined us as the old CEO of Athleta, and so we definitely see that trend continuing. And all I have to do is look at my 18 year old son because Don't know, street joggers also known as sweatpants has become, you know has become okay to wear to dinner to date to learn how to work, to sleep. And so that is you know, these are I think that is the fun of fashion is Yeah, things are constantly changing. And so staying relevant is important. And is there one thing, we have to wrap up, but is there one thing you would tell all of us, like we should go out and add to our closets now and will be thanking you in a year or two years? Well, I was. No sweat pants please. Right, right. Well, I have to advocate for our Rockstar jeans. I'm wearing the now and they are. I think the number one women's Jean in America, so please go try them, they will fit all of you > how many of those do you sell a day? > we sold forty thousand a day, so that's cool, so that, and then for a little fashion, the camera woman behind the stage was commenting on my jacket so please Let's go by that too. [ LAUGH ] Thank you so much Sonia.

Most Powerful Women Summit 2019: How Old Navy Is Preparing for Life on Its Own

How Old Navy Is Preparing for Life on Its Own

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CEO Sonia Syngal talks about the company's imminent spin-off from Gap Inc.