LiPo Ching - MCT
The Gap's push into Asia comes as it plans to reduce its number of stores in North America from 889 to 700.
SHANGHAI -- The jeans are stiletto-thin - you won't find baggy pants on these racks - and the customers squeezing into them look for denim that makes a bold statement.
"She looks like she has attitude," said Mike Dai, eyeing his girlfriend, Amy He, after she wiggled into a narrow pair of Levi's on a September afternoon in a high-end mall.
The brand is all-American, but the San Francisco-based jeans-maker offers clothes that are all-Asian - pants designed in Hong Kong with an edgy, worn-and-torn finish that can sell for as much as $149 a pair.
As the American market continues to sputter, and China's continues to boom, U.S. retailers have updated business plans to include the world's second-largest economy as well as the rest of growing Asia. Just as Louis Vuitton, Gucci and Apple have erected temples of capitalism in cities like Shanghai and Beijing, Western apparel makers have infused their clothing lines with Asian sensibilities in look, feel and size while embarking on aggressive store campaigns in this part of the world.
"You can see the power of scale and the power of the rapidly rising affluent," said Aaron Boey, Levi's head of Asia Pacific. "China is one of the top three markets for us. It's the fastest-growing market we have."
Last year, Levi Strauss launched an entirely new line - Denizen - in China before rolling it out in Target stores in the United States in August.
It's the first time a Western clothier has done that, signaling the new economic might of the East, experts say.
Asians are 'aspirational'
"China is a more important market now for all these companies," said James Roy, a retail expert with the China Market Research Group. "It's been a source for a lot of their global growth in the last two, three years. This is only going to happen more and more."
While Levi's has been in China for a decade, Gap, also based in San Francisco, is playing catch-up. Since November, it has opened seven stores on the mainland, including a 12,000-square-foot outlet in Shanghai's upscale Hong Kong Plaza, as part of a larger strategy to beef up its presence across Asia.
In Vietnam, the first Gap franchise opened in Ho Chi Minh City at the end of September - and two more will follow in the country's commercial hub before the year's end, while another is planned for Hanoi in 2012.
"Asians are very aspirational," said Danreb Cartagena Mejia, marketing director for Imex Pan Pacific, the Vietnamese conglomerate that has a franchise agreement with Gap. "They have always wanted to have this," he added, nodding at the Ho Chi Minh City store opening celebration, an event that resembled a movie premiere with trays of champagne and mint vodka being passed and famous Vietnamese actors, models and singers on hand. "Now they can buy it."
Gap's China campaign, in which 14 to 15 stores will be open by the end of 2011, features photographs taken by Annie Leibovitz and is part of a campaign to expand its international business.
Online and international sales accounted for 22 percent of the company's business last year and Gap wants to increase that to 30 percent by 2013.
China, on the verge of becoming the world's largest luxury market, is key to the company's global expansion, said Redmond Yeung, president of Gap China.
By 2020, Credit Suisse predicts China will overtake the United States as the world's largest consumer market, accounting for nearly a quarter of all global private spending.
