Since normcore was a swing and a miss, Gap is currently doing some frantic soul-searching. But meanwhile, low-cost corporate little sister Old Navy is having her moment in the sun.

The New York Times reports on the brand’s resurgence under the leadership of Stefan Larsson, formerly of H&M. Business had slumped over the course of the 2000s, thanks in part to players like H&M muscling in. “Old Navy’s approach used to be selling commodities,” one analyst told the Times—which became very hard to sustain once shoppers could go down the street and get something closer to a designer knockoff for the same amount. Or whatever deranged faux-leather tie-dye concoction Forever 21 is peddling on any given day.

Nowadays, Old Navy’s offerings are still inexpensive, but they’re putting more thought into the design. They recruited higher-flying talent. (Sample move made by new hires: “One of the first changes Mr. Wicksteed made was to liven up the company’s drab headquarters in San Francisco with pop photography and upbeat music.”) They threw in more runway-inspired looks, alongside the basics. Because—are you sitting down?—budget shoppers trying to stretch a dollar to cover an entire family actually like having some trendy pieces to pick from. Wild! For instance, something called “pixie pants” have been a big hit:

One of Old Navy’s biggest triumphs has been its pixie pants. Two years ago, just as Mr. Larsson’s team was getting the label’s new look off the ground, a designer on Old Navy’s women’s team noticed that blogs and runways were filling up with casual, slim-fitting pants. The design team “obsessed over every detail” — the fit, the cut just above the ankle — and quickly tested different prints and colors in stores. The pants were a hit.

All this is paying off:

Since his arrival, Mr. Larsson has led a striking turnaround at the low-cost label, transforming Old Navy from a butt of jokes to its parent company’s crown jewel. Last year, Old Navy took in almost $6 billion in sales in the United States — almost as much in sales as the Gap and Banana Republic brands put together — and made up 40 percent of the company’s global revenue. Earnings due this week are expected to underscore Old Navy as Gap’s biggest driver of growth as its other big labels are struggling.


Now if only we can get some more of that design savvy in their plus-size offerings...

Image via Old Navy.

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